OECD: multilateral action advised to reduce export restrictions

South Africa – The BIR world recycling organisation has welcomed calls from OECD experts for multilateral action to counter the harmful impact of export restrictions on steelmaking. The advice was given at an OECD workshop in Cape Town last week which highlighted the detrimental effects of such restrictions and the efficiency gains to be made from their simultaneous removal both upstream and downstream of steelmakers.

Compared to other sectors, the steel industry is particularly susceptible to protectionist measures owing to its history of subsidies and excess capacity.

It was strongly argued in Cape Town that export restrictions introduced to protect a national metals industry′s primary and secondary raw material supply could actually jeopardise the viability of the scrap supply sector.

The access to cheap domestic scrap created by such restrictions could lead to uncompetitive plants remaining in operation and could serve as a deterrent to investment for the future. Making the use of export restrictions more transparent was the first step proposed towards their removal because only then could alternative policies to achieve the same objective be determined. Indeed, the best way forward was the simultaneous multilateral removal of export restrictions.

The time was ripe for such action, it was said, in order to seize the opportunity created by the oversupply of steelmaking raw materials in the next few years. ′While the trend towards more export restrictions is currently the case, this OECD workshop has now made the case for multilateral action to reduce such restrictions in order to benefit the steel industry worldwide,′ comments BIR environmental & technical director Ross Bartley, who attended the workshop organised jointly by governments participating in the OECD Steel Committee and by South Africa′s Department of Trade and Industry.

′The slower alternative is for countries to remove export restrictions though bilateral trade agreements. The difficulty is that almost all steelmakers and their governments would need to be convinced of the benefits to take multilateral action, and to take that multilateral action in order to get those increased benefits to more steelmakers more quickly,′ he adds. 

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