China Power | Environment | East Asia

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

Now Beijing needs to build domestic demand for recycled materials – and global rules for the trade.

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 “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........

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