Rapport fra ICC: Globale handelsregler kan fremme overgangen til en sirkulær økonomi
The Circular Economy and International Trade: Options for the World Trade Organization (WTO)
Trade rules slowing transition to circular economy
Trade rules slowing transition to circular economy, says ICC report. A major independent report published in December by ICC spotlights the need for a significant overhaul of global trade rules if governments are to meet their stated aim of accelerating the adoption of circular business models.
The study – The Circular Economy and International Trade: Options for the World Trade Organization – highlights that while international trade has a vital role to play in promoting resource efficiency and decoupling economic outputs from material inputs, policy responses to date have largely been designed at the national level and in an uncoordinated manner. The net result of this patchwork of interventions – from unilateral import bans to varying domestic product standards – has been to stoke trade frictions that inhibit the ability of companies to implement circular solutions which often rely on cross-border trade to achieve vital economies of scale.
The report is built around several real-life case studies – developed by the University of Adelaide’s Institute of International Trade through a series of stakeholder consultations with ICC’s global business networks over the past year – which illustrate the complexities and delays that businesses face in implementing circular approaches throughout their value-chains. In this connection, the analysis shows how:
- The repurposing or recycling of electric vehicle batteries is significantly inhibited by divergences across jurisdictions in recycling regulations or definitions of what constitute waste.
- The lack of common interpretation of European rules leads to delays or barriers to “waste” movements across EU jurisdictions – with countries adopting different lists of what is considered hazardous waste.
- Companies struggle to navigate national laws that do not effectively differentiate between products or materials which can be reused, repaired, repurposed, or refurbished versus those that should be recycled or disposed.
- The reuse of “waste” materials is often limited by trade standards which only consider the origin of a product rather than its quality.
- The application of punitive tariffs on secondary materials can significantly drive up the cost of deploying circular approaches.
The report concludes with a review of potential initiatives that could be undertaken through the World Trade Organization (WTO) to address trade frictions that currently hinder the development of a global circular economy. These range from cutting tariffs on goods and services related to circular approaches through to defining common principles or best-practices to limit the unintended consequences of domestic environmental regulations. ICC stands ready to engage with WTO members on the implementation of the report’s recommendations.