A rules-based trading system is the cornerstone of well-functioning global markets. And well-functioning markets are the foundation for more resilient global supply chains – and therefore a stronger recovery.
However, the number of trade barriers in the form of export restrictions on commodities has trended upwards in recent years, according to the OECD’s Inventory of Export Restrictions on Industrial Raw Materials, which aims to improve transparency and understanding of the use of such restrictions. The growth in restrictions on waste and scrap – a vital part of the circular economy, including reducing the carbon intensity of industrial processes such as steelmaking – is especially notable.
Governments, especially in countries whose commodity resources are abundant, may impose export restrictions to hold on to a scarce, and therefore valuable, raw material. It is a way of supporting the creation of higher-value downstream processing industry, or of supporting other economic policy objectives.
An efficient circular economy nonetheless works better if markets are open and transparent. Eliminating trade barriers would therefore support the circular economy.