14 October 2015: The International Resource Panel (IRP) has published a report on the role of international trade in increasing resource efficiency, reducing environmental impact and promoting equitable and inclusive growth. Revealing that the value of international trade has increased over six-fold and its volume more than doubled between 1980 and 2010, ‘International Trade in Resources: A biophysical assessment’ examines upstream resource requirements – the materials, energy, land and water used in the country of origin for producing traded goods, but left behind as wastes and emissions.

The IRP, which aims to steer the world away from overconsumption, waste and ecological harm, was launched by the UN Environment Programme (UNEP), and is made up of scientists and governments from developed and developing regions, civil society, and industrial and international organizations.

The IRP report on trade in resources focuses on environmental efficiency more than on economic efficiency, and explains how trade could be resource efficient by allowing commodities to be obtained from countries/locations where their production requires fewer resources and generates fewer environmental impacts than in others. However, the publication underlines, higher trade levels, declining ore grades and decreasing energy returns upon energy investment (EROEI), higher food demand and diminishing land productivity further increase the upstream resource requirements of trade, which could negate the benefits of a potentially more resource efficient allocation of extraction and production activities via world trade.

Achim Steiner, UNEP Executive Director, explained that the benefits of international trade can include better access to resources and even more efficient production techniques from economies of scale, but the associated increase in global consumption and production results in overall environmental impact, from pollution to resource depletion. “That these impacts are being transferred to poorer nations is further cause for concern,” Steiner said, stressing the need for policies that protect the environment from trade’s detrimental effects.

The report shows that dependency on world markets is highest for fossil fuels and metals, with around half of the volume of extracted fossil fuels and metals being reallocated through trade.

The publication concludes that: the amount of global resource extraction has increased at a slower rate than trade, showing the rising dependency of countries on trade; 15% of the resources extracted and used worldwide are directly traded, with the proportion rising to 40% when including resources used in the production process, but not physically included in the traded goods; there is a shift in resource-intensive processes from high-income countries to developing and emerging economies, with a corresponding shift in associated environmental burdens; high-income countries continue to be main recipients of resources via trade, while emerging economies such as China have switched to becoming major importers; and the world trading system relies on fewer net exporters, making it increasingly vulnerable to disruptions in supplies. [UNEP Press Release] [Publication: International Trade in Resources: A biophysical assessment] [International Resource Panel Website] [UNEP Knowledge Repository]