https://doi.org/10.20965/ijat.2020.
p0873
Review:
The Impact of Recyclable Waste Trade Restrictions on
Producer Recycling Activities
Michikazu Kojima†
Institute of Developing Economies, Japan External Trade Organization (IDE-JETRO)
3-2-2 Wakaba, Mihama-ku, Chiba-shi, Chiba 261-8545, Japan
† Corresponding author, E-mail: michikazu.kojima@eria.org
[Received March 28, 2020; accepted September 14, 2020]
From the mid-1990s to 2017, China was a major im-
porter of recyclable waste, including plastic waste,
e-waste, wastepaper, and copper scrap. However, af-
ter experiencing pollution from the recycling process
and improper disposal of imported waste, at the end
of 2017, China prohibited the import of certain types
of waste, including household plastic waste and waste
fiber. Consequently, some types of recyclable waste
were rerouted to Southeast Asia. However, after re-
ceiving contaminated recyclable waste imports, South-
east Asian countries also tightened import restrictions
on recyclable waste. These restrictions hindered the
international recycling initiatives of certain manufac-
turers, which were model cases of the voluntary ap-
plication of extended producer responsibility. When
producers initiate recycling programs, they must com-
pete with other recyclers to secure waste supplies and
compete with other producers of the same kind. To
compete in the waste and product markets, they must
minimize recycling cost. To do so, some producers
established international recycling systems; however,
trade restrictions in some countries are forcing them
to stop these programs. This paper reviews the im-
pact of recyclable waste trade restrictions on recycling
activities and producer-organized international recy-
cling systems and argues that there is a need for an
appropriate trade policy to facilitate environmentally
sound recycling.
Keywords: international recycling, trade restrictions,
producer-organized recycling activities
1. Introduction
In the 1990s, China became a major importer of vari-
ous kinds of recyclable waste, such as waste plastics and
e-waste. Although the recycling of imported waste has
been a source of materials such as plastic products, paper,
and metals for Chinese industries, the recycling process
has also generated air and water pollution, and residue
from the recycling process has been improperly disposed.
China has been experiencing the consequences of the re-
cycling of imported waste since the mid-1990s. For ex-
Int. J. of Automation Technology Vol.14 No.6, 2020
© Fuji Technology Press Ltd. Creative Commons CC BY-ND: This is an Open Access article distributed under the terms of
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The Impact of Recyclable Waste Trade Restrictions on
Producer Recycling Activities
ample, children living in Guiyu, Guangdong, an e-waste
recycling village, had significantly higher blood lead and
cadmium levels than those living in other areas [1].
The Government of China is attempting to intensively
enforce import restrictions, and in March 1996, issued a
regulation listing the types of recyclable waste that could
be imported. Plastic waste was not on the initial list but
was included in an amendment in December 1996 [2].
Similarly, e-waste was not on the list, but could be im-
ported under the category of steel or copper scrap for re-
covering metals. In 2002, regulators prohibited e-waste
imports, including printers and copy machines, but en-
forcement was initially low.
Customs and other relevant authorities have imple-
mented frequent inspections under the following joint
campaigns: Green Fence in 2013, National Sword
in 2017, and Blue Sky in 2018. To further mitigate pol-
lution problems, at the end of 2017, China tightened im-
port restrictions on recyclable waste, such as plastic and
e-waste.
Several papers that examine the impact of Chinese
trade restrictions and import bans have focused on the rea-
sons for these restrictions, changes in trade flows of recy-
clable waste (especially plastic waste), environmental pol-
lution in alternative destinations such as Southeast Asian
countries, and the impact of Chinese import bans on ex-
porting countries. With respect to the Chinese import ban,
Tan et al. [3] pointed out that the recycling of imported
waste has been polluting the environment since the 1990s.
In two and half years, from 2013 to mid-2015, Chinese
customs seized 1.49 million tons of nonrecyclable waste
from 343 shipments. In addition to restricting imports
of non-recyclable wastes, the Chinese government has re-
stricted the import of plastic waste to increase the use of
domestically generated recyclable waste [4].
Most studies analyzing changes in recyclable waste
flows due to the Chinese import ban focus on plastic
waste. Brooks et al. compiled trade data on plastic waste
from 1988–2016 and found that China imported 103 mil-
lion tons of plastic waste from 1992–2016 [5]. They also
estimated that plastic waste displaced by the import ban
would reach 111 million tons by 2030. Some of the dis-
placed plastic was routed to Southeast Asian countries.
Marrs, Rucevska, and Villarubia-Gomez [6] and Wang
et al. [7] pointed out that Southeast Asian countries in-
873
Kojima, M.
creased plastic waste imports in 2018. Using monthly
import data, Kojima [8] indicated that the surge in plas-
tic waste imports by Southeast Asia peaked in March–
June 2018, after which the volume of imports by South-
east Asian countries declined to the level recorded at the
end of 2017, when China banned the import of plastic
household waste. This decline occurred because new des-
tinations such as Indonesia, Malaysia, Thailand, and Viet-
nam tightened import restrictions and strengthened pollu-
tion control enforcement. Exports from developed coun-
ties also dropped by approximately 50% in the third quar-
ter of 2018, compared with the fourth quarter of 2017 [8].
In Southeast Asian countries, pollution from plastic re-
cycling and improper disposal of imported waste has been
reported. Greenpeace Malaysia [9] reported the illegal
burning and dumping of imported plastic waste and indi-
cated that the existing monitoring and enforcement poli-
cies and practices in Malaysia were inadequate to curb
such operations. The Global Alliance for Incinerator Al-
ternatives [10] shows pollution from recycling and open
dumping of imported plastic waste in Malaysia, Thailand,
and Indonesia.
The impact of Chinese import restrictions on ex-
porting countries has also been analyzed. Morita and
Hayashi [11] reviewed the destinations of plastic waste
generated in Japan and identified the types of plastic waste
exported to China prior to the introduction of restrictions
and subsequently disposed in Japan after the Chinese re-
striction. Such plastic wastes began to be disposed in
Japan after the Chinese restriction was extended to “low
grade” plastic wastes, which contain contaminants due to
insufficient sorting and mixed plastics composed of mul-
tiple types of plastics and other materials.
In the United Kingdom (UK), the National Audit Of-
fice [12] found a packaging recycling system flaw. In the
system, once waste is sent abroad, a Packaging Export Re-
covery Note is issued without considering the actual recy-
cling rate in the importing country. If a UK recycler sorts
and exports recyclable waste without any other waste, the
recycler earns revenue only from selling the Packaging
Recycling Note to producers for the exported amount. If
the UK recycler does not sort the waste and instead ex-
ports all the collected waste, the recycler earns revenue
from the full amount of the collected waste. Such prac-
tices incentivize UK recyclers to send collected waste to
China or other countries without proper sorting.
Although many studies have examined the impact of
Chinese import restrictions on plastic waste flows and on
recycling in exporting countries and alternative destina-
tions, few have looked at the impact of these restrictions
on recyclable wastes other than plastic or the impact of
trade restrictions by China and other countries on prop-
erly managed international recycling.
By comparing various scenarios of global resource cir-
culation in terms of economic benefits and costs and envi-
ronmental impact, Kishita et al. [13] identified two strate-
gies to reduce environmental risks: (i) establishing a hy-
brid domestic global circulation system and (ii) strength-
ening traceability in global circulation. Import restrictions
874
also prevent manufacturers from recycling their products
internationally.
This paper suggests an appropriate trade policy to facil-
itate environmentally sound recycling, based on two case
studies and the improper recycling of imported waste in
China and Southeast Asia. Section 2 examines the Fuji
Xerox recycling program for Asia and the Pacific region
that focuses on recycling or refurbishing copy machines,
printers, and expendable supplies. The Fuji Xerox recy-
cling factory was closed in 2019 due to the introduction of
stricter import restrictions by Thailand. Section 3 exam-
ines the Teijin recycling program for waste clothing made
from polyester that began in Japan and expanded its col-
lection area to other countries, such as the United States
(US), France, and Sweden. The recycling factory was ini-
tially located in Japan but later moved to China. How-
ever, the collection program for waste polyester clothing
in Japan ended in 2018 when China imposed import re-
strictions. Section 4 discusses the relationship between
the responsibility of producers and trade restrictions on
recyclable waste, considering producer-organized recy-
cling programs.
2. An International Recycling Program for
Copy Machines and Printers in Southeast
Asia
Fuji Xerox Eco-Manufacturing, a subsidiary of Fuji
Xerox, began operations in Thailand in December 2004.
Before opening its recycling factory in Thailand, Fuji Xe-
rox invested in recycling their products. In 1995, Fuji
Xerox adopted “Promoting Reuse of Resources for In-
finite ‘Zero Landfill”’ as the company-wide product re-
cycling policy. Although the 1991 Act for the Promo-
tion of Utilization of Recyclable Resources in Japan did
not place any obligations on copy machine manufactur-
ers, the concept of EPR began to gain popularity in the
mid-1990s [14] (Table 1).
In December 1995, Fuji Xerox began selling products
using reused parts in the market, and in 1997, produc-
tion lines for products incorporating new and reused parts
were integrated. Thus, the appearance, quality, function,
reliability, and lifetime of products made using new and
used parts became indistinguishable.
In 2000, the act was revised and renamed the Act on the
Promotion of Effective Use of Resources. This revised act
named manufacturers of copy machines “designated re-
sources reutilizing business operators,” who should make
efforts to reuse parts. Copy machines were also desig-
nated as “specified reuse-promoted products.”
Based on the achievements of the company in Japan,
Fuji Xerox expanded its recycle and reuse efforts in Asia
and the Pacific region, and established a new recycling
factory in Chonburi, Thailand in 2004. The company
collected waste copy machines, printers, and expendable
supplies from countries in Asia and the Pacific region, in-
cluding Australia, New Zealand, the Republic of Korea
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 The Impact of Recyclable Waste Trade Restrictions on
Producer Recycling Activities

Table 1. History of Fuji Xerox’s recycling plant in Thailand.

Dates Activity
Adopted “Promoting Reuse of Resources for Infinite ‘Zero Landfill”’ as company-wide product recycle pol-
1995
icy.
December 1995 Introducing products that incorporate re-used parts in the market.
In Japan, production lines using new and re-used parts were integrated into one line. The appearance, quality
October 1997 and function, reliability, and lifetime of products made using new parts and re-used parts became indistin-
guishable.
2000 Achieved zero waste in Japan.
In Japan, the Act on the Promotion of Effective Utilization of Resources was revised. Copy machine pro-
2000 (promulgated)
ducers were listed “designated resources reutilizing business operators,” and copy machines were designated
2001 (enforced)
“specified reuse-promoted products.”
The Fuji Xerox Eco-Manufacturing, the regional recycling plant, began operating in Thailand. Waste
copy machines were collected from nine countries and region in Asia and the Pacific∗a) . Materials derived
December 2004 through dismantling were classified into 64 categories and recycled. In fiscal year 2004, the material recycling
rate was 84.0%, the thermal recycling rate was 15.0%∗b) , and the landfill and incineration rates were 0.6% in
total.
September 26, 2005 Eco-Manufacturing Company Ltd. received an ISO14001 certification.
2007 Fuji Xerox received ‘Honda Awards for Resources Recirculation Technologies and Systems.’
About 131,000 units of waste have been collected and 21,200 tons have been recycled. The recycling rate
By March 2010
reached 99.8%∗b) .
Fuji Xerox (Hong Kong Ltd.) won the gold award of the 2011 Hong Kong Awards for Environmental Excel-
lence, organized by the Hong Kong Special Administrative Region’s Environmental Campaign Committee,
June 2012
the Environmental Protection Department, and nine other organizations. One of the reasons for this award
was the company’s international recycling program.
2012 Recycling systems were developed in the Republic of Korea, Australia, and New Zealand.
Fuji Xerox received ‘Sustainable Business Award Singapore’ for waste management and materials produc-
2015
tivity.
June 2019 The recycling factory was closed.
*a): The nine countries are Australia, New Zealand, the Republic of Korea, Indonesia, Malaysia, Singapore, Hong Kong, and Thailand.
*b): The recycling rate means ratio of ‘volume of recycled materials’ in volume of dismantled copy machines, printers, and expendable
supplies.
Source: [14, 15, 18–21].

(henceforth Korea), Indonesia, Malaysia, the Philippines,
Singapore, Hong Kong, and Thailand [15].
This initiative was partly inspired by increasing con-
cern about the e-waste problem in developing countries.
In 2002, the Basel Action Network, a nongovernment
organization in the United States, issued a report titled
Exporting Harm: The High-Tech Trashing of Asia [16],
which shed light on the problem of pollution from the re-
cycling of e-waste imported from the US and other de-
veloped countries to Asian countries, primarily China.
The report insisted that exporting countries and producers
should be responsible for preventing the improper recy-
cling of e-waste in developing countries. Most research
on the transboundary movement of e-waste stressed that
e-waste generated by developed countries was being ex-
ported to developing countries, where pollution control is
less stringent and/or poorly enforced [17]. The EU issued
the Waste Electrical and Electronic Equipment Directive
in 2003, and some developing countries in Asia also be-
gan considering introducing similar regulations.
In these circumstances, Fuji Xerox decided to invest in
a recycling factory for Asia and the Pacific region. This
factory was located in Thailand because of (i) the pres-
ence of outstanding recycling companies in the country,
with technology on par with that in Japan; (ii) strong sup-
port from the Government of Thailand; and (iii) logistical
convenience and efficiency, as Thailand is at the center of
Asia and the Pacific region [18].
Thai policy on hazardous waste imports may have been
another reason why Fuji Xerox chose to establish their re-
gional recycling facility there. Indonesia and Malaysia
ratified the Basel Convention Ban Amendment, which
prohibits developed countries (such as those of the Or-
ganization for Economic Co-operation and Development
(OECD)) from exporting hazardous waste to developing
countries that have ratified the amendment. If the regional
recycling factory was in one of these developing coun-
tries, it would have been difficult to send waste copy ma-
chines and printers from Australia, New Zealand, and Ko-
rea, which are OECD members. Indonesia prohibits the
import of hazardous waste from developed and develop-
ing countries alike. However, Thailand has not ratified the
Ban Amendment; thus, partly for this reason, Fuji Xerox
decided to develop its recycling factory there.
The Fuji Xerox principles of the integrated recycling
system in Asia and the Pacific region are (i) preventing il-

Int. J. of Automation Technology Vol.14 No.6, 2020 875

Kojima, M.
legal disposal by collecting used equipment as the respon-
sibility of the manufacturer, (ii) avoiding the incurrence of
environmental impacts in importing countries, (iii) avoid-
ing waste generation in importing countries, and (iv) pro-
viding benefits to importing countries as follows [19]. To
fulfill the principles, Fuji Xerox policies are to: (i) di-
rectly manage and operate the plant and guarantee no risks
to customers and import countries, (ii) ensure continuous
and uniform quality by collecting used equipment gener-
ated in nine countries in Asia and the Pacific region, and
(iii) reduce environmental impacts in each country and re-
gion [19].
In line with these principles and policies, some recy-
clables and waste generated by the recycling factory, such
as waste photoconductor drums and fluorescent tubes,
could not be recycled in Thailand and were sent to Japan
for proper recycling and disposal.
In developing countries, the informal sector collects
and recycles e-waste. Chi et al. [20] indicated that the
informal sector often prevails over the formal sector be-
cause of lower levels of protection for workers and the
environment. The informal collection system is simpler
and processing costs are lower. In the case of copy ma-
chines, most users have service contracts, such as main-
tenance and supply of expendables, and the manufacturer
or companies have agency contracts with manufacturers.
Fuji Xerox uses this service contract channel to collect
waste copy machines and other items.
To compete with the informal sector, Fuji Xerox must
reduce the cost of recycling through economies of scale.
It is also important to prevent pollution generated by their
own recycling process and by downstream recyclers, such
as those that extract copper, gold, and silver from printed
circuit boards and integrated circuit tips. Such facilities
may exist in other countries. The cost of logistics to col-
lect end-of-life copy machines should also be considered
when considering a suitable recycling facility location.
Initially, the factory was capable of dismantling
20,000–30,000 machines and 500,000 expendable sup-
plies per year. The copy machines, printers, and expend-
able supplies were manually disassembled into 64 cat-
egories of scraps; this number is higher than in Japan,
where there are 44 scrap categories. The separated scraps
were sent to 16 recycling processors (12 in Thailand and
4 in Japan). The transportation and processing of sepa-
rated scraps were monitored by a traceability system, in-
cluding a consignment note1 [19]. In fiscal year 2009, the
number of categories increased to 74, and the recycling
rate reached 99.8% [21]. Residual wastes were sent to
Japan to be treated and disposed, while various types of
materials, such as metal, glass, and plastic, were sent to
recycling companies in Thailand and other countries.
The Fuji Xerox achievement is well recognized in Thai-
land, Japan, and elsewhere. In 2005, the factory earned an
ISO 14001 certification [22] and received the gold medal
of Industrial Waste Management Award from the Depart-
ment of Industrial Works in Thailand several times [23].
1. “Consignment note” is called “manifest” in Japan.
876
In 2007, the Honda Awards for Resources Recirculation
Technologies and Systems was also given to Fuji Xe-
rox to achieve zero landfill in the international recycling
system in Asia and the Pacific [24]. The Government
of Hong Kong gave Fuji Xerox Hong Kong an environ-
mental award for activities, including its Fuji Xerox Eco-
Manufacturing recycling system [25].
In 2012, Fuji Xerox stopped exporting waste copy ma-
chines and printers from Australia, New Zealand, and Ko-
rea to its recycling factory in Thailand [22], primarily be-
cause of the possible entry-into force of the Basel Con-
vention Ban Amendment. In 2011, the 10th Conference
of Parties of the Basel Convention clarified the conditions
under which the Ban Amendment would be enforced, thus
increasing the likelihood that it would do so. Although
it took more time than expected to satisfy this condition,
Fuji Xerox decided to establish national recycling systems
in Australia, New Zealand, and Korea. Since 2012, the re-
cycling factory in Thailand has only received waste from
the following Southeast Asian countries: Hong Kong, In-
donesia, Malaysia, the Philippines, Singapore, and Thai-
land. Although Thailand, Australia, New Zealand, and
Korea have not ratified the Ban Amendment, the company
set up recycling systems in Australia, New Zealand, and
Korea, which are OECD countries, to account for the pos-
sibility of the amendment entering into force (Table 2).
In July 2017, the Chinese government announced that
it would prohibit imports of 24 additional types of recy-
clable waste by the end of the year. In 2002, it banned the
import of e-waste including televisions, air conditioners,
monitors, printers, and copy machines. In 2015, e-waste
without hazardous substances, such as lead, mercury,
cadmium, and polybrominated diphenyl ethers (PBDE),
was excluded from the list of prohibited items. Despite
no significant changes in Chinese import restrictions on
e-waste, the Government of Thailand began investigating
e-waste recycling factories in May 2018 and detected im-
proper e-waste imports and recycling.
For example, the police and other Thai ministries in-
vestigated a factory in Chachoengsao, which was oper-
ated by a Chinese owner with workers from the Lao Peo-
ple’s Democratic Republic and Myanmar. In the factory,
imported e-waste was dismantled, and metals were ex-
tracted. The factory also heated printed circuit boards to
remove integrated circuit tips and other parts [26]. At the
end of May 2018, the Department of Industrial Works and
Police in Thailand inspected 148 e-waste recycling facto-
ries nationwide, including seven factories licensed to im-
port e-waste from abroad. They found illegal imports and
processing of e-waste and revoked the import license of
five companies [27] but found no violations by the Fuji
Xerox recycling company.
Although China prohibited the import of various forms
of e-waste in 2002, enforcement was not very strict in the
past. However, recently, Chinese customs and relevant
authorities have jointly implemented three campaigns to
enforce related regulations more strictly: Green Fence
in 2013, National Sword in 2017, and Blue Sky in 2018.
Tighter enforcement at the border and within China may
Int. J. of Automation Technology Vol.14 No.6, 2020

Table 2. Status of ratification of the Basel Convention and import restrictions on hazardous waste.
Ratification of the Ratification of the
Basel Convention Ban Amendment
Australia 1992
Hong Kong 1997∗a) 2001 (China)
Indonesia 2005
Republic of Korea 1994
Malaysia 2001
New Zealand 1994
Philippines 1993
Singapore 1996
Thailand 1997
*a): The Ban Amendment entered into force in December 2019.
Note: Regarding Hong Kong, in June 1997, the Secretary-General received communications concerning the status of Hong Kong from
the Governments of the United Kingdom and China. Upon resuming the exercise of sovereignty over Hong Kong, China notified the
Secretary-General that the Convention will also apply to the Hong Kong Special Administrative Region.
Source: Author, based on Basel Convention, ‘Status of Ratification’; ‘National Reporting’ [38].
cause e-waste recyclers to shift their location from China
to Thailand. The volume of e-waste imported by Thai-
land increased from 9,402 tons in 2016 to 41,945 tons
in 2017. Following concerns about a surge in plastic im-
ports in 2018, the government strengthened inspections
of plastic waste recycling factories and found massive
amounts of illegally imported e-waste. In August 2018,
a meeting of all related agencies held to address envi-
ronmental problems caused by e-waste concluded with
a resolution to ban import hazardous waste, including
e-waste [28]. Consequently, although Fuji Xerox did not
violate any regulation, the company closed its facility in
June 2019.
3. Program to Collect and Recycle Clothing
Made from Polyester
In 2000, Teijin, a manufacturer of fiber and textile prod-
ucts, developed technology to recycle fiber from waste
polyester and waste polyethylene terephthalate (PET) bot-
tles. Before establishing its fiber-to-fiber recycling pro-
gram, Teijin developed technology to produce fibers from
PET bottles in 1995. This recycled fiber has been used to
produce uniforms, shirts for men, sports socks and shoes,
curtains, and other items [29] (Table 3).
After successful recycling PET bottles, Teijin looked
for an opportunity to begin a program recycling polyester
textiles. In 1999, before the fiber-to-fiber technology
was developed, Teijin began preparing a collection pro-
gram called EcoCircle, with customers such as producers
of uniforms, including school and school gym uniforms.
In 2002, the new ‘fiber-to-fiber’ production line was set
up at the company factory in Tokuyama, Japan.
Sandin and Peters [30] classified textile recycling
systems into four categories: reuse, closed-loop re-
Int. J. of Automation Technology Vol.14 No.6, 2020
The Impact of Recyclable Waste Trade Restrictions on
Producer Recycling Activities
National policy on import of hazardous waste
All hazardous waste imports banned.
Imports of hazardous waste from non-OECD countries require
special permission, while imports from OECD countries are to-
tally prohibited.
In 2018, Thailand prohibited imports of e-waste.
cycling, open-loop recycling, and energy recovery.
Closed-loop recycling includes the recycling of fabric,
fiber, monomers, and oligomers. The Teijin fiber-to-
fiber recycling program is monomer recycling. The
Ellen MacArthur Foundation [31] states that chemical
monomer recycling could be the method of choice for ma-
terials of such low quality that there are no other viable
recycling alternatives. Anders et al. [32] signaled that the
technology used in the Teijin EcoCircle is the only com-
mercially available chemical recycling process.
In 2002, EcoCircle had approximately 30 member
companies. In 2004, the production line was moved
to Matsuyama Factory in Ehime, Japan, and the num-
ber of companies gradually increased, reaching approx-
imately 70 in 2005 [33]. One of these companies was
Patagonia Inc., an internationally well-known outdoor
wear company based in the US. This company was the
first to join outside Japan.
In 2008, Teijin began a new initiative to expand its part-
ners to include garment accessory designers and produc-
ers and established the EcoCircle Garment Accessories
Association. This association created a new opportunity
for the company to expand its clothing collection pro-
gram. EcoCircle first focused on uniforms, the produc-
ers of which can easily control the materials used for but-
tons, linings, and other elements. However, it is more
difficult to control apparel products other than uniforms
without the cooperation of various designers and produc-
ers of garment accessories. Therefore, a new association
was established.
By 2009, the EcoCircle had grown to include 120 com-
panies. Li Ning Company, a leading Chinese sports ap-
parel company, became the first Chinese company to join
EcoCircle. In 2010, EcoCircle received the Innovation
Award from Independent Commodity Intelligence Ser-
vices, a petrochemicals market intelligence provider, in
the field of environment [33]. The number of collaborat-
877
Kojima, M.

Table 3. History of EcoCircle.

Dates Activity
1995 Short fiber produced from waste PET bottles.
1999 EcoCircle started as a partnership with manufacturers of uniforms, such as school uniforms.
2000 New technology to recycle waste PET bottles and waste polyester fiber developed.
2001 Act on the Promotion of Effective Utilization of Resources entered into force.
2002 New facility for ‘fiber-to-fiber’ began operating at the Tokuyama Factory.
2003 ‘PET bottle to PET bottle’ recycling process begun.
2004 Facility for fiber-to-fiber recycling moved to Matsuyama Factory.
2005 Patagonia joined EcoCircle, the first company outside Japan to do so.
2007 Partnership initiated with manufactures of other items, such as fashion apparel.
The number of companies joining EcoCircle reached 84, and the annual sales volume of recycled polyester
End of March 2008
fiber reached 5,000 tons.
2009 Li Ning, a Chinese apparel manufacturer, joins EcoCircle, the first Chinese company to do so.
EcoCircle won the Independent Commodity Intelligence Services Innovation Award 2010 in the category of
October 2010
Innovation with Best Environment Benefit.
Teijin and Jinggong Group, a Chinese company, jointly established Zhejian Jiaren New Materials Company
2012
Ltd. for recycling polyester fiber.
2013 EcoCircle won the business award ‘Eco Japan Cup 2012.’
The collection of used polyester products stopped in Japan, because of difficulties sending the collected items
June 2018
to recycling facilities in China.
PET = Polyethylene terephthalate.
Sources: [29, 33–35].

Table 4. Result of LCA conducted by Patagonia (per metric ton of DMT).

DMT made by Teijin
DMT made by Teijin
DMT made by Teijin from Capilene collected
Category from waste clothing col-
without recycling by Patagonia in the
lected locally
United States
Distance (miles) 0 0 7,000
Fuel for transport (gallons) 0 0 38
Total energy (MJ) 72,422 11,962 17,773
Energy use in production (MJ) 72,422 11,962 11.962
Energy in transportation (MJ) 0 0 5,771
Total CO2 emissions (metric tons) 4.18 0.98 1.20
CO2 emissions in production 2.08 0.98 0.98
CO2 emissions in incinerating old and used garments 2.10
CO2 emissions in transportation 0 0 0.226
CO2 = Carbon dioxide, DMT = Dimethyl terephthalate, MJ = Megajoule.
Note: ‘Capilene’ is a Patagonia trademark for clothing, footwear, and headgear.
Source: Made by the author, based on [35].

ing companies increased rapidly, reaching 136 in 2010,
and approximately 150 in 2012, from seven countries:
Japan, China, the US, Canada, Norway, Finland, and
France.
Fiber recycling is good for the environment. Com-
pared to the production of dimethyl terephthalate (DMT)
from oil with incinerating waste polyester products, the
production of DMT from waste fiber consumes approxi-
mately 84% less energy and emits 77% less carbon diox-
ide (CO2 ) [34] (Table 4). Patagonia, an EcoCircle mem-
ber, found that, even considering the environmental bur-
den of transporting waste textiles from the US to Japan,
recycling fiber emits less CO2 than making fiber from oil
with waste textile incineration [35].
Teijin has also developed fiber recycling plants in
China, with the Zhejiang Jiabao New Fiber Group, which
produces items such as polyester filaments and chips. The
recycling company receives the waste fibers from the pro-
duction process and waste textile products made from
polyester. Waste fiber products collected in Japan were
also sent to the factory in China until 2017. This project
was mentioned in the document exchanged at the Seventh
Japan-China Energy Conservation and Environment Fo-
rum in 2012.

878 Int. J. of Automation Technology Vol.14 No.6, 2020


However, Teijin stopped its collection program in Japan
at the end of June 2018 because of Chinese restrictions on
recyclable waste imports. It is unclear what harmonized
system (HS) code was used for exporting waste fiber from
Japan and other countries to China. There are three pos-
sibilities: HS Code 3915 for plastic waste, HS Code 5505
for waste synthetic and artificial fibers, and HS Code 6309
for worn clothing. Imports of worn clothing were prohib-
ited in 2002. HS Code 5505 for waste fiber was included
on the list of importable waste in 2005 and 2015 but pro-
hibited at the end of 2017, together with imports of plastic
household waste (HS3915). Although the collection pro-
gram stopped, waste fiber from production processes in
China is still recycled in the factory.
4. Producer Responsibility and Trade
Restrictions on Recyclable Waste
Since the 1990s, many governments have been trying
to require producers to shoulder some responsibilities for
end-of-life products through initiatives, such as minimum
recycled content, take-back requirements, and advance
disposal fees [36]. Even when governments do not en-
force regulations applying EPR, some producers volun-
tarily implement EPR, including recovering and recycling
end-of-life products. The Fuji Xerox recycling program
in Southeast Asia and the Teijin EcoCircle program are
voluntary EPR initiatives.
Nonetheless, the potential impact of EPR regulations is
different for Fuji Xerox and Teijin. In the case of Fuji
Xerox, the EU and Japan have applied EPR to waste elec-
tric and electronic equipment. Some developing coun-
tries, including Thailand, have also begun to consider
adopting an EPR recycling system for e-waste. In con-
trast, the recycling of waste textiles is essentially market-
driven.
When EPR is enforced as a legal requirement, all man-
ufacturers must assume the cost of recycling. The recy-
cling programs organized by Fuji Xerox and Teijin are
voluntary initiatives, and these companies must pass on
the recycling costs to their product prices. To compete
with others, including informal recyclers and competitors,
producers seeking to implement EPR voluntarily should
minimize their recycling costs. Otherwise, producers who
want to recycle their products may not be able to collect
end-of-life products, because informal recyclers can col-
lect recyclable waste at a higher price; moreover, produc-
ing products may become more expensive than for other
producers who recycle the products with less effort.
Implementing EPR leaves a better impression on con-
sumers, but recovering and recycling end-of-life products
may be costly. Utilizing economies of scale is one of sev-
eral ways to reduce recycling costs. For example, when
more waste is collected from a wider area, the unit cost of
recycling can be reduced, while transportation costs may
increase. To utilize economies of scale, Fuji Xerox col-
lects waste copy machines, printers, and expendable sup-
plies from various countries, whereas the Teijin program
Int. J. of Automation Technology Vol.14 No.6, 2020
The Impact of Recyclable Waste Trade Restrictions on
Producer Recycling Activities
employs economies of scale by processing waste textiles
and waste generated by production processes in China.
Another way to reduce costs (lowering labor costs) is
not mentioned in the document prepared by Fuji Xerox
and Teijin. As parts of the recycling process are labor in-
tensive, locating a recycling facility where labor is cheap
may be preferable. In certain countries, the cost of labor is
lower than in Thailand or China; however, in this context,
the cost of logistics is also important because collected
waste is sent to the recycling facility and recycled materi-
als are sent to factories for use.
Additionally, the destination of collected or recycled
materials when choosing the location of the recycling fa-
cility is an important consideration. In the case of Fuji
Xerox, although there are various recycling companies in
Thailand, some of the waste was also sent to Japan for
recycling and disposal. Thus, the location of the factory
should be chosen considering the logistical cost of trans-
porting waste from the collection area.
Producers intending to establish an international recy-
cling system should also consider import restrictions. If
the country in which the recycling factory is located pro-
hibits imports of the type of waste that the producer wants
to recycle, an international recycling system will not be
feasible. When Fuji Xerox and Teijin first established
their international recycling systems, Thailand permitted
e-waste imports and China permitted waste fiber imports.
Although both programs are highly appreciated, and have
received awards, and were innovation initiatives, import
restrictions in the host counties prevented these effective
recycling programs from continuing.
In economics, free trade maximizes social welfare if no
market failure occurs. Although the international recy-
cling system causes environmental pollution from recy-
cling in importing countries (a market failure), trade re-
strictions in both countries were too strict and resulted in
the breaking of effective resource circulation systems.
One of the challenges in establishing a resource circu-
lation system is competition with products made from vir-
gin resources. Cost increase resulting from trade restric-
tions may cause voluntary recycling initiatives to shrink
in terms of collection or recycling rates.
There are ways to maintain good international recy-
cling programs while controlling improper imports of re-
cyclable waste. For example, importing countries can
require exporters and importers to participate in a prior
notice and consent scheme. The Basel Convention on
the Control of Transboundary Movements of Hazardous
Wastes and their Disposal covers such control measures.
Under the prior notice and consent scheme, after the ex-
porter and importer agree on the trade of hazardous waste,
the exporter must submit a letter to the competent author-
ity in the exporting country expressing its intention to ex-
port hazardous waste to a specific destination. The gov-
ernment of the exporting country must then send the no-
tice of export intention to the government of the importing
country. The government of the importing country must
check the facility treating the waste with respect to pol-
lution control, balance of the received volume of waste
879
Kojima, M.
)LJXUH3ULRU1RWLFH&RQVHQW3URFHGXUHXQGHUWKH%DVHO&RQYHQWLRQ
Source: Author.
Fig. 1. Prior notice consent procedure under the Basel Con-
vention.
to be recycled, the capacity of the facility for treatment,
and waste flow management. If the facility and its man-
agement are satisfactory, the government issues consent
to the exporting country. Based on this consent, the gov-
ernment of the exporting country issues the export permit.
Through such measures involving thorough inspection of
the factory receiving the waste, proper international recy-
cling can be assured (Fig. 1). The Fuji Xerox recycling
program in Southeast Asia followed such control mea-
sures.
The second policy option is strengthening the enforce-
ment of regulations in border control and recycling facto-
ries. The Deputy National Police Chief of Thailand told
the Bangkok Post in an interview that some politicians
were involved in illegal imports and e-waste recycling.
They have helped Chinese businessmen procure land for
e-waste recycling plants and warned local authorities not
to perform inspections [37].
In mid-2017, the Chinese government strengthened en-
forcement of regulations through intensive inspections of
companies importing recyclable waste. According to the
China Ministry of Environmental Protection on July 29,
2017, of the 1,792 recyclable waste-importing companies
that have been inspected, 1,074 were found to have vio-
lated regulations, such as those prohibiting imports of un-
washed waste plastics, or mandating proper air pollution
control. Such inspections can create a level playing field
of competition and encourage the proper development of
the recycling industry.
If the government enforces pollution control regula-
tions, prohibiting imports of recyclable waste will be un-
necessary, as these will be properly managed by recyclers
or producers. This can help reduce improper recycling.
5. Conclusion
This paper reviews two recycling initiatives by produc-
ers in Asia that have been affected by trade restrictions
and discusses the appropriate form of control of the inter-
national trade of recyclable waste. Some producers have
tried to establish a recycling system for their products.
The two cases described in this paper exhibited the best
880
initiative. The Fuji Xerox recycling system in Southeast
Asia achieved a high rate of recycling (more than 99.5%)
and refurbishment. The technology used by Teijin for its
polyester recycling program is regarded as the only com-
mercially available technology.
An international recycling system is desirable for uti-
lizing economies of scale in recycling processes and pol-
lution control and in the location of industries using re-
cycled materials. Securing a sufficient volume of waste
is a precondition for investing in recycling factories with
appropriate production processes and pollution control.
Economies of scale work in the recycling process and
the appropriate control of pollution. To conduct recycling
properly at a lower cost, the international trade of recy-
clable waste is inevitable because of economies of scale
in some recycling processes.
These case studies show that overly strict import re-
strictions hinder the development of voluntary producer
initiatives to achieve a circular economy. Such initiatives
help reduce improper waste management. Additionally,
both systems described here worked well because they
utilized economies of scale to reduce the cost of recycling.
Some recyclers smuggle recyclable waste, including
plastic waste and e-waste, and do not invest in pollu-
tion control. To prevent such activities, regulations, such
as pollution control and imported recyclable waste stan-
dards, should be enforced.
However, overly strict regulations, such as bans on the
import of recyclable waste, may prevent the development
of a proper recycling system such as the Fuji Xerox and
Teijin programs. Appropriate policies to develop proper
recycling systems can set the standard for imported recy-
clable waste by implementing an import license system,
preventing smuggling at the border, and adequately en-
forcing pollution control, without totally prohibiting the
import of recyclable waste.
Such policies may allow the creation of environmen-
tally friendly recycling facilities in developing countries.
Regarding e-waste, due to weak law enforcement in most
developing countries, informal recyclers who extract met-
als and other parts from waste are competitive because
they need not assume the cost of abating pollution. For-
mal recyclers who properly manage pollution often can-
not compete with informal recyclers.
Waste generators that provide waste to formal recyclers
assume more costs than informal recyclers. Waste import
permits may provide an incentive to invest in proper recy-
cling facilities, as opposed to informal recyclers that dom-
inate the collection of domestically generated recyclable
waste. One risk of a producer-organized international re-
cycling system is trade restrictions on recyclable waste.
Governments should consider implementing appropriate
policies and enforce relevant regulations to facilitate in-
vestment in proper facilities.
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Name:
Michikazu Kojima
Affiliation:
Chief Senior Researcher, Institute of Developing
Economies, Japan External Trade Organization
(IDE-JETRO)
Address:
3-2-2 Wakaba, Mihama-ku, Chiba-shi, Chiba 261-8545, Japan
Brief Biographical History:
1990- Institute of Developing Economies
2018-2020 Economic Research Institute for ASEAN and East Asia
(seconded from IDE-JETRO)
2020- IDE-JETRO
Main Works:
• M. Kojima, A. Yoshida, and S. Sasaki, “Difficulties in Applying
Extended Producer, Responsibility Policies in Developing Countries: Case
Studies in E-waste Recycling in China and Thailand,” J. of Material Cycles
and Waste Management, Vol.11, No.3, pp. 263-269, 2009.
Membership in Academic Societies:
• Japan Society of Material Cycles and Waste Management (JSMCWM)
• Society for Environmental Economics and Policy Studies (SEEPS)
• Japan Society for International Development (JASID)
881