Will you take my (s)crap? Waste havens in the global plastic waste trade

Abstract For two decades until 2017, China imported more than half of the world’s traded plastic waste. Starting in 2018, however, China banned further imports of post-consumer plastic waste. The ban forced many countries to seek new ways to deal with plastic waste, including new destinations for exports. These changes may have significant impact on global social welfare and the environment. In this study we first ask whether trade in plastic waste follows a waste haven pattern, shifting environmental burden from richer countries and those with better environmental regulations to poorer countries and those with with weaker regulations. Second, we evaluate how China’s import ban altered the plastic waste trade. Empirical analysis using a gravity model reveals that the plastic waste trade follows a waste haven pattern, and the ban exacerbated this relationship. Differences in per capita GDP drove bilateral trade both before and after the ban, and disparities in stringency of environmental regulations became influential following the ban. Given that post-ban import volumes far exceeded pre-ban volumes in many countries, these results raise two concerns. First, post-ban trade increases were seemingly driven by exporters’ demand for disposal services rather than importers’ demand for plastic waste, thereby increasing environmental burden in poorer countries. Second, because countries with weak environmental regulations likely have poor waste management systems, this pattern of plastic waste redistribution may worsen the existing global plastic waste pollution crisis.| JEL codes: F14, F18, F64, O19