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Pros and Cons of Trading Used Goods

To improve the efficiency of resources and prolong their useful life, it is necessary to remove the existing barriers to trade in used and second-hand goods, highlighted the Economic Commission for Latin America and the Caribbean (ECLAC).

It is recognized that this would imply that importing countries are responsible for the treatment of these goods towards the end of their lives, which entails difficulties and associated costs.

In addition, some used goods, such as vehicles, can generate undesired impacts in import markets because they are more polluting and inefficient than new goods.

Used goods

Several companies import used goods for reconditioning and remanufacturing, these being generally classified as waste in trade statistics.

There are also some tariff glosses that identify, for example, used clothing or used and retreaded tires. According to ECLAC, these products are generally imported by developing countries, while many developed countries prohibit their importation.

Refurbished products

In general, remanufactured goods are marketed in the domestic market and frequently face barriers to being re-exported, for not meeting international market standards or requirements.

Caterpillar and Komatsu are examples of multinational companies that have remanufacturing centers specialized in reconditioning machinery and its parts and components.

Waste trade

ECLAC also stated that the international waste trade has a circular logic only if the waste can effectively be recovered in the receiving country under adequate environmental and social controls.

Regarding this, there is permanent concern in the trade and environment negotiations regarding the possible negative environmental and social impacts of this commercial flow, due to the risk of generating a waste crisis in a receiving country -especially developing countries- with insufficient capacity of management and regulations more lax than those of developed countries.

In Latin America and the Caribbean, an important part of waste classification and recycling still remains in the hands of informal sectors of the economy.

However, awareness regarding the opportunity to consider waste as a resource is growing, since it can generate employment and promote the national production of secondary raw material.

Although there are tariff glosses in the Harmonized System of Merchandise Trade (Harmonized System or SA) that allow waste and waste flows to be identified, there are still important gaps for their traceability under the logic of the circular economy.

Existing definitions do not clearly delimit between waste and secondary raw material, specifying that a waste can be considered a raw material for another production process.

 

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