After 9 Years, China Is Reopening Its Borders To Recycled Plastic

In November 2026, the European Union will prohibit exports of potentially recyclable plastic to non-OECD countries. The EU labeled these exports “waste” and described the cross-border flows as “environmental exploitation.” At the same time that the EU is shutting down the trade, China has reversed course and committed to expanding the movement of recyclable plastic across its border. For most of the past decade, China was closed to imports of plastic waste entirely. The EU and China seem to be moving in different directions. Europe’s efforts concentrate on boosting demand for recycled plastic at home while taking a hardline position on exports abroad. China’s new approach is centered on supply and weaker on the demand for recycled plastic. Each holds lessons for the other, because a scalable framework for tackling global plastic pollution requires action on both the demand and supply sides. And yet the recent developments in China have drawn almost no analysis outside China. That’s a mistake, because no country in recent history has shaped the global recycling trade more than China. China’s Plastic Ban China’s “National Sword” policy, launched in 2017, abruptly closed the country to imports of plastic waste – a seachange for China, which had absorbed much of the world’s recovered plastic for two decades. There were good reasons for the change. Much of the plastic waste wealthier countries shipped to China was contaminated or unrecyclable, local importers often lacked the capacity to handle it, and China’s monitoring system was underdeveloped at the time. The result was increased plastic pollution inside China. The National Sword program curbed the air and land pollution that earlier shipments had caused and forced a reckoning in countries that had outsourced their waste sorting problem for a generation. However, National Sword, on its own, could not build a circular economy for plastic. With imported feedstock of plastic waste unavailable and no demand-side policy pulling recycled material through the system, the market simply started making more virgin plastic. China’s imports of primary plastic rose from 29.7 million tonnes in 2017 to 40.9 million tonnes in 2020, an average annual increase of 12.6 percent, nearly tripling the rate of the preceding five years. China then developed the capacity to make at home what it had been buying abroad, and self-sufficiency in synthetic resins climbed to 90 percent in 2024. China was still using mountains of plastic; the biggest change was that plastic shifted to virgin material sourced within China. Recycled plastic inside China competes against a domestic petrochemical sector that accounts for roughly 40 percent of global capacity, exports more than 17 million tonnes a year, is structurally oversupplied, and runs on margins thin enough that producers are incentivized to move volume at whatever price they can get. Recycled resin is not only more expensive without economies of scale; it also faces a well-organized petrochemical industry with close ties to political power. As crude prices spiked this year, the price gap against recycled materials closed. But when the cost of oil slipped back this summer, the cost of virgin plastic followed it down, and some Chinese buyers moved orders back to virgin material. The central lesson of the National Sword policy has implications reaching well beyond China: supply-side restriction of recycled plastic without demand-side policies encouraging a circular economy can simply entrench the role of virgin plastic. Today, much of China’s waste is currently incinerated for energy, consuming large volumes of plastic that could instead be reprocessed. Beijing Changes Course – But Work Remains It has taken time, but China’s circular economy architecture is now taking shape. The Circular Economy Development 15th Five-Year Plan, published in July 2026, commits China to taking in good-quality recycled feedstock from abroad. It calls for reworking the entry mechanism, simplifying the procedures that govern it, and widening the range of categories that can be brought in, so that imported material supplements domestic supply. The Five-Year Plan targets an internationally advanced recycling sector by 2035, with a separate seven-agency action plan setting an annual benchmark of more than 19.5 million tonnes of recycled plastics by 2030. In 2017, China’s government closed the world’s largest market for recovered materials. Now Beijing is preparing to reopen it, selectively. That is a significant change of direction, but it’s also a work in progress. The ambitious vision for a circular economy as yet exists only on paper. Increasing imports of recyclable plastic alone will not create a market: imported material with no mandated offtake produces warehouses of pellets that cannot compete. In China’s case, the glut of virgin plastic from the domestic petrochemical industry makes a compelling case for the government to mandate demand for recycled content. Mandated demand would drive more domestic collection and recovery, and strengthen the case for imported feedstock to reach efficient scale. When governments require a minimum share of recycled resin in packaging or consumer goods, brands and companies redesign their supply chains to comply, pulling investment into collection, sorting technology, and materials innovation. Mandates also shift the burden away from consumers and sidestep the obstacles that have blocked more drastic steps, notably production caps in the U.N. Plastic Treaty negotiations, which have proved too contentious to command consensus. Mandates of recycled content are the most important tool missing on China’s side. Chinese national standards for recycled plastic are almost all recommended rather than mandatory. That is changing in principle: the Ecological Environment Code, which took effect this month, establishes for the first time in Chinese law that the state can create a mandatory system for the use of recycled materials in key product categories. National and local authorities should now act on this policy signal. For China, this is not only about environmental stewardship. It is industrial upgrading. China is the world’s largest producer and exporter of plastic goods, and its export markets are moving. The EU’s Packaging and Packaging Waste Regulation requires single-use plastic beverage bottles sold in the EU to contain at least 30 percent recycled content by 2030, rising to 65 percent by 2040. In South Korea, a comparable rule has been in force since January: makers of bottled water and soft drinks running more than 5,000 tonnes a year must meet a 10 percent recycled floor, rising to 30 percent by 2030. So far, China has no comparable law. These mandates will impact Chinese manufacturers operating in the export sector – but China’s plastics demand is overwhelmingly domestic. Setting its own local and national requirements would accelerate innovation at home. One constraint deserves particular attention: China has not yet approved recycled plastic for food-contact use. This is where the highest-value demand sits, meaning whichever jurisdiction solves scalable food-grade recycling will command a premium position. China is well equipped to compete in food-grade applications, but on its current trajectory it also risks being left behind. Reframing the Plastic Trade The indiscriminate character of China’s National Sword policy created a second problem: a lasting fear of trading plastic at all. Recycling capacity worldwide now sits underused due to the lack of access to qualified feedstock, as well as weak domestic collection. The language of plastic “waste” evokes the unchecked, poorly sorted shipments of the past, but that is a concern modern certification and traceability can address. Trade bans relocate plastic waste; they do not improve how it is handled across the global economy. The alternative is trade conducted on published, enforceable standards. Countries that treat recovered plastic as waste to be disposed of will keep writing rules designed to stop it moving. This is EU’s position: processing, it believes, should stay in Europe. By contrast, countries that treat plastic waste as feedstock for an advanced manufacturing sector – one built on robotics, AI-enabled sorting, materials science, and chemical engineering – will write rules designed to verify it instead. China’s circular economy strategy now reflects the view that recovered plastic holds significant economic value. The National Development and Reform Commission framed the plan in terms of resource security under geopolitical pressure – effectively treating recycled plastic as strategic feedstock. Beijing could have used the same argument to justify self-sufficiency; instead, it gave a seal of approval to increased trade. China is correctly moving beyond blanket restrictions on plastic flows. The question going forward is whether China’s plastic policy can shape regional and global practices, especially in the area of standards. Standards settle the question of what counts as waste. Europe is restricting the movement of all plastic by-products while China is opening to verified material. China is well positioned to curtail disguised waste by helping to define high global standards for recyclable materials. Inside its borders it has already redrawn the boundary between waste and secondary raw material: in August 2025 the State Administration for Market Regulation and the Standardization Administration of China issued nine national standards for recycled plastics. By extending and internationalizing that work, China has a chance to write the rules for the global plastic trade, with a focus on environmental permits and verified marketplaces. China’s recent policy announcements made scant reference to the regional landscape, which is a missed opportunity. As different parts of Asia act on plastic pollution, there is considerable scope for governments to learn from each other and harmonize their standards. The building blocks already exist: recycled-content mandates in India and South Korea, the possibility of an ASEAN feedstock benchmark, Japanese and Korean processing technology, and Australian certified exports. There is an instructive parallel in the Multi-Jurisdiction Common Ground Taxonomy, the green finance classification agreed jointly by China, the EU, and Singapore. That already serves as a key reference point for practitioners in sustainable finance. Conclusion The EU is restrictive on the movement of recovered plastic but has progressive recycled content mandates; China has it the other way around. The best outcome is not for one model to prevail over the other, but for both to keep evolving toward a mix of tools directed at both the supply of and the demand for recycled plastic. For China, a pragmatic pathway to a circular economy at national, regional, and international levels rests on four measures: introducing recycled-content mandates, innovating on food-grade packaging, leading on certification and traceability standards, and making the case that recycling and open trade in recovered material belong to advanced manufacturing. Global plastic governance remains fragmented and multilateral negotiations have exposed deep political divisions. In that vacuum, policy in the major economies can shape the global circular economy, most powerfully by reconfiguring regional and international supply chains. The rules for the next phase of this trade are being written now, in Brussels, in Beijing, and elsewhere. China has the industrial base and now the stated policy. China should match its domestic architecture with new programs to generate domestic demand for recycled plastic, and carry the standards it has built within its territory into regional and international arenas.