Recent Trends in Export Restrictions

Prices for commodities such as minerals and metals have increased significantly over the pastfew years. At the same time, there has also been an increase in restrictions on the export of raw materialswhich has led policy makers and business people to address free trade of raw materials. This paperprovides information on the present situation regarding the use of export restrictions and internationaldisciplines on these measures. Export restrictions are maintained to achieve diverse policy objectives,including environmental protection or conservation of natural resources, promotion of downstreamprocessing industries, controlling inflationary pressures, and for fiscal receipts reasons. Export restrictionstake various forms such as export duties, quantitative restrictions, and licensing requirements. The numberof countries applying export duties over the period 2003-2009 was higher than in previous years and thatsuch duties were introduced primarily by developing and least developed countries. Under the currentWTO rules, unlike quantitative export restrictions which are in principle prohibited, there is no substantivediscipline on export duties, although there have been efforts to revise this at the multilateral and bilaterallevels. The WTO accession process imposes several disciplines. Export restrictions have also beendiscussed during the DDA negotiations in both NAMA (Non-Agricultural Market Access) and agriculturenegotiations. Several regional trade agreements (RTAs) went beyond the WTO by including prohibition ofexport duties. Export restrictions, by creating a differential between the price available to domesticprocessors and the price charged to foreign processors, provide domestic processing industries with anadvantage. Although several governments apply export restrictions to achieve diverse policy objectives,not all rely on such restrictions. Alternative policy options with different trade impacts are used. In view ofthe significant impacts of export restrictions on global supply chains, transparency on the use andimplementation of such measures should be substantially improved.