Global Plastic-Waste Reallocation and Pollution after China’s Import Ban

Qiuxia Gao | Bingjing Li | Yu Qin

Feb 25, 2026

Key Takeaways

Research Question: This study examines how China’s 2017 ban on plastic-waste imports reshaped global waste trade networks and redistributed environmental and health burdens across countries.
Data and Method: Using monthly bilateral trade data from 2015–2023 and satellite-based PM₂.₅ measurements, the authors implement a difference-in-differences strategy to trace both trade reallocation and local pollution impacts.
Findings
- Roughly half of the plastic-waste displaced by China’s ban was redirected to other Asian economies, raising monthly net imports by approximately 1.09 million USD per country on average.
- The reallocation disproportionately favored countries with weaker environmental governance, limited recycling capacity, and higher baseline pollution exposure, consistent with a pollution-haven mechanism.
- Areas within 5 km of plastic-waste processing sites in high-import countries experienced a statistically significant 0.4% increase in PM₂.₅ concentrations.
Implications: The results indicate unilateral environmental regulations can export pollution and health risks abroad, underscoring the need for coordinated global waste governance.

Source Publication:

Gao, Q., Li, B., & Qin, Y. (2025). Global Plastic-waste Reallocation and Pollution: Evidence from China’s Import Ban. SSRN Working Paper

Background and Research Question

For decades, the global plastic-waste trade operated under a stark asymmetry: high-income countries exported large volumes of plastic-waste to developing economies, where lower processing costs and laxer environmental enforcement made recycling economically viable. China occupied the central node of this system, absorbing more than half of the world’s traded plastic-waste at its peak. Although this arrangement reduced disposal costs for exporters, it imposed severe local environmental costs, including open burning, contaminated recycling streams, and chronic air pollution.

This equilibrium abruptly collapsed in December 2017, when China implemented the “National Sword” policy, permanently banning imports of foreign plastic-waste classified under HS code 3915. China’s exit from the global waste market constituted a large, sudden, and plausibly exogenous trade shock. The central question of this study is not whether the ban reduced pollution within China—which it did—but how the displaced waste was reallocated globally and what environmental consequences followed in the new destination countries.

Data and Empirical Strategy

The authors assemble a comprehensive panel of 126 countries covering the period from January 2015 to December 2023. Trade flows are drawn from monthly bilateral data compiled by the International Trade Centre and complemented with CEPII’s BACI database. The empirical strategy exploits the policy shock using a difference-in-differences design that compares changes in trade volumes of banned plastic-waste with unbanned waste categories, such as recovered paper or cork waste.

To measure environmental impacts, the study combines high-resolution satellite-derived PM₂.₅ concentration data from the Atmospheric Composition Analysis Group with geocoded locations of plastic-waste processing facilities identified through the Google Maps API. Pollution exposure is evaluated by comparing PM₂.₅ levels within 5 km of processing sites to concentric control rings located 5–20 km away. The analysis focuses on countries experiencing large post-ban import surges, including Thailand, Indonesia, Malaysia, Turkey, South Korea, Japan, and Pakistan. All specifications include city-by-year fixed effects and time-varying climate controls—temperature, wind speed, and precipitation—spatially aggregated using inverse distance weighting.

Findings

China’s import ban triggered a pronounced and geographically concentrated reallocation of plastic waste. Asian countries excluding China absorbed nearly half of the displaced global flows, experiencing an average monthly increase in net imports of 1.09 million USD. No other region exhibited a comparable or statistically significant rise, highlighting Asia’s central role as the new destination for plastic waste.

Figure 1: Plastic-Waste Trade Networks before and after China’s Waste Import Ban

Notes: These figures depict bilateral plastic-waste trade flows between the top eight exporting countries and their main import partners. Figure a shows the average trade flows from January 2015 to November 2017, before China’s waste import ban; Figure b presents the averages from December 2017 to December 2023, after the ban. The nodes on the left denote exporting countries, and those on the right denote importing countries. The width of each band reflects the share of exports from a given exporter to a specific importer, relative to that exporter’s total plastic-waste exports.

Figure 2: Event Study of Plastic-Waste Net Import

Notes: This figure displays event-study estimates of the effects of the waste import ban on net plastic-waste imports in Asia (excluding China). Standard errors are clustered at the country and year level. *P < 0.10; **P < 0.05; ***P < 0.01; the dependent variable is the annual net import value of waste (thousand USD) from 2015–2023. The treatment group is defined as banned plastic waste, whereas the control group consists of other non-banned waste types. Country-by-year, country-by-HS code, and year fixed effects are included. Error bars indicate 95% confidence intervals.

The redistribution was highly uneven across countries. The largest inflows accrued to economies that were already integrated into global waste trade networks and that exhibited weaker environmental safeguards. Countries with high baseline PM₂.₅ exposure—used as a proxy for limited regulatory capacity—saw monthly net import increases exceeding 1.78 million USD. This pattern is reinforced by evidence on the exporting side: much of the redirected waste originated from non-OECD countries and major exporters, suggesting a cascading re-export mechanism in which contaminated or low-quality plastics move through intermediate hubs before reaching final processing sites in Asia.

Figure 3: Heterogeneous Effects on Plastic-Waste Net Import across Countries

Notes: This figure plots the heterogeneity in the spillover effects of the waste import ban on net plastic-waste imports across Asian countries. Standard errors are clustered at the country and year level. *P < 0.10; **P < 0.05; ***P < 0.01; the dependent variable is the monthly net import value of waste (thousand USD) from January 2015 to December 2023. The treatment group is defined as banned plastic waste, and the control group consists of other non-banned waste types. Country by-year month, country-by-HS code, and year-month fixed effects are included. Error bars indicate 95% confidence intervals.

These trade shifts had measurable environmental consequences. Following the ban, PM₂.₅ concentrations increased by 0.4% in areas located within 5 km of waste processing facilities in high-import countries, relative to nearby control areas. The magnitude is modest in percentage terms but economically and epidemiologically meaningful given the large populations exposed and the well-documented health risks associated with fine particulate matter. Back-of-the-envelope calculations based on established exposure-response relationships imply average annual health costs of approximately 82 million USD per affected country, with substantially higher burdens in populous economies and those hosting dense clusters of processing sites.

Figure 4: Event Study of Air Pollution

Policy and Governance Implications

The evidence highlights a fundamental limitation of unilateral environmental regulation in an interconnected global economy. China’s import ban succeeded in reducing domestic pollution but simultaneously displaced environmental and health externalities onto other countries, many of which are less equipped to manage them. Rather than eliminating plastic-waste pollution, the policy reshaped its geography.

This reallocation reflects a form of environmental arbitrage. When trade restrictions are imposed without parallel international coordination, waste flows gravitate toward jurisdictions with lower enforcement capacity and weaker environmental institutions, effectively creating pollution havens for waste rather than production. The findings suggest plastic-waste trade should be treated as a global governance problem rather than a series of bilateral transactions.

Effective policy responses therefore require strengthened international coordination, particularly within the framework of the Basel Convention. Beyond enforcement, meaningful progress will depend on multilateral investment in recycling infrastructure, monitoring capacity, and pollution-control technologies in recipient countries. Absent such coordination, future unilateral bans are likely to continue shifting environmental and health burdens toward vulnerable populations, reproducing global inequalities in exposure to pollution rather than resolving them.

HKU Jockey Club Enterprise Sustainability Global Research Institute