China’s Discriminatory Policies on Recovered Paper Imports
On July 18, 2017, China’s government notified the World Trade Organization (WTO) that it was banning the importation of 24 categories of recyclable materials by the end of 2017, including unsorted waste and scrap paper - what the U.S. industry describes as “mixed paper”. Then, on November 15 China notified the WTO that it was changing the contaminants control level for all other recovered paper imports from 1.5 percent to a very restrictive 0.5 percent.
Chinese paper mills have long used recovered paper imported from the U.S. to manufacture new paper-based packaging materials and other paper. Altogether, U.S. recovered paper exports to China amounted to 10.9 million metric tons with a value of $1.7 billion in 2017, representing a decline of 17.5 percent and 10.3 percent from their 2016 levels, respectively.
China’s Ministry of Environmental Protection also began limiting import licenses for recovered paper for containerboard and other paper mills and local wastepaper brokers.
AF&PA Opposes Artificial Barriers to Trade
Recovered paper for recycling is a commodity that should retain its access to free markets that allow the flow of fiber to meet the needs of users who value it the most.
China’s restrictive recovered paper import policy mischaracterizes imports of mixed paper and the other grades of recovered paper as solid waste and garbage, which they are not. U.S. recovered paper exports are required to meet specific quality requirements as set by the grade and quality definitions established by the Institute of Scrap Recycling Industries, Inc.
Banning mixed paper imports regardless of quality and without supporting evidence of harm to the environment, health or safety and giving preference to domestically sourced recovered paper violates the WTO Agreement on Technical Barriers to Trade and other WTO rules.
AF&PA filed comments with the WTO and the Chinese government to both sets of China’s notifications stating that the restrictive measures on imports of all recovered paper do not comply with China’s obligations under WTO rules.
AF&PA voiced its opposition through communications with officials from the Office of the U.S. Trade Representative (USTR) and the U.S. Department of Commerce, who in turn have raised the issue with their Chinese counterparts. AF&PA also urged paper associations in other major recovered paper supplying countries, including Japan and the United Kingdom, to press their governments to engage with China on this issue.
AF&PA is encouraging USTR and other governments to seek engagement with China on this issue and to obtain a resolution that ensures imports of recyclable commodities from the U.S. are not treated less favorable than domestically sourced recyclable materials.