Most lanes remain closed at the Peace Arch border crossing into the U.S. from Canada, where the shared border has been closed for nonessential travel in an effort to prevent the spread of the coronavirus, Thursday, May 7, 2020, in Blaine, Wash. The restrictions at the border took effect March 21, while allowing trade and other travel deemed essential to continue. (AP Photo/Elaine Thompson)

OPINION: Why trade restrictions must be eliminated during 2nd wave of COVID-19

Nearly 100 countries enacted temporary restrictions or bans on the export of medical products this year

During the COVID-19 pandemic, countries around the world have faced acute shortages of personal protective equipment (PPE), medicines and other essential medical supplies, severely compounding the health crisis. Such shortages remain an acute and pressing problem, and are expected to worsen during a second wave.

Many countries have responded to shortages by imposing export restrictions in an effort to bolster their own domestic supplies. But even though governments should seek to protect their populations, the use of export restrictions is damaging to global health systems — and ultimately undermines efforts to combat the coronavirus.

At the onset of the pandemic, nearly 100 countries enacted temporary restrictions or bans on the export of medical products.

Germany and France, for example, placed export restrictions on medical equipment and drugs, which were followed by an European Union-wide ban on medical equipment exports to non-EU countries.

India — the world’s largest pharmaceutical manufacturer — restricted the export of dozens of drugs, including acetaminophen and various antibiotics.

The United States halted the sale of masks and other medical gear to foreign buyers. A range of other countries followed suit, imposing various forms of restrictions, ranging from outright export prohibitions to cumbersome licensing requirements to discourage exports.

Restrictions could escalate in second wave

While some export restrictions have since been removed, many remain in place. And with a second wave looming, there is a risk that the use of such restrictions will escalate once again.

Export restrictions hurt the countries that implement them, as well as their trading partners, by preventing deliveries of medical supplies and medicines, which can seriously disrupt health planning.

Export restrictions can temporarily lower domestic prices and raise availability, giving the illusion of efficacy, but they discourage investments to increase production capacity, so any benefit is short-lived.

Countries that impose export restrictions are also likely to fuel retaliation or emulation by other nations, cutting off their own access to medical products and components.

Export restrictions therefore reduce the domestic availability of medical supplies, while also promoting panic-buying, hoarding and speculation.

The World Trade Organization (WTO) is supposed to prevent governments from arbitrarily imposing barriers to the flow of goods across borders. But during the COVID-19 crisis, its rules have failed to stop countries from imposing export restrictions.

Existing WTO rules give considerable scope to governments to respond to emergencies, including permitting trade measures to protect human health, and allowing temporary export restrictions to prevent or relieve shortages of essential products.

Full self-sufficiency impossible

Some have suggested that the answer to supply shortages is to reshore production, so that each country produces its own medical supplies.

But that’s neither realistic nor desirable. Medical supply chains are global in nature and, given the complexity of the products involved, it would be impossible for any one country to be fully self-sufficient.

To take just one example, ventilators require as many as 1,000 parts, coming from dozens of countries and nine layers of suppliers. Trade in medical supplies and the components required to produce them is, therefore, essential.

Four recommendations

We propose four policy directions to address the trade-related aspects of the crisis:

1. Governments must strengthen their commitment to prevent export restrictions in critical medical supplies. A group of nine countries, led by New Zealand and Singapore, has launched a multi-country pact to keep supply chains open and remove trade restrictions on essential goods. This initiative should be expanded through a WTO agreement to refrain from introducing measures that restrict trade in medical supplies.

2. Governments should pursue diversification, rather than domestication, of medical supply chains. Countries are most vulnerable to serious shortages when they rely heavily on just a handful of suppliers for critical goods, regardless of whether those suppliers are domestic or foreign. Diversification is therefore the best way to reduce the risk of supply chain disruptions.

3. Rather than competing with one another for scarce medical goods, states should be collaborating to address the underlying problem. Amid a global pandemic, beggar-thy-neighbour (or sicken-thy-neighbour) trade policies intended to bolster a country’s own medical supplies at the expense of others are counter-productive. Instead, the most effective means to address the supply shortage is through international co-operation to boost production, diversify medical supply chains and ensure supplies can move to where they are needed the most.

4. Governments must significantly increase their investment in stockpiling reserves of essential medical supplies. Many countries maintain such stockpiles — containing everything from masks and gowns to ventilators — but chronic under-funding left them dangerously unprepared for the current crisis. When the pandemic hit, countries rapidly depleted their limited stocks. The resulting supply shortage was caused not by dependence on trade, but a failure in planning.

Export restrictions are damaging both to the countries that implement them as well as their trading partners. As we stare down a second wave of COVID-19, there are far better alternatives to prevent shortages and ensure adequate supply of medical goods.

Kristen Hopewell receives funding from the Social Sciences and Humanities Research Council of Canada (SSHRC). Joshua Tafel does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.

Like us on Facebook and follow us on Twitter.

Want to support local journalism? Make a donation here.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Police investigating multiple stabbing at a Newton townhouse on Tuesday night. (Photo: Shane MacKichan)
Man charged with murder, aggravated assault in Newton townhouse stabbings

Harpreet Singh is to appear in Surrey provincial court on Oct. 29

Do you have someone you would like to thank? Or maybe something to get off your chest? Email your rose or rotten tomato to edit@surreynowleader.com.
Roses and Rotten Tomatoes (Oct. 22, 2020)

Our weekly collection of compliments and complaints sent in by readers

The Surrey Eagles are currently seeking billet families for its players in advance of the 2020-‘21 BC Hockey League season. (Garrett James photo)
Surrey Eagles in ‘desperate’ need of billet families for BCHL season

COVID-19 pandemic has made finding homes for players difficult: billet co-ordinator

Mail-in ballot from Elections BC (Katya Slepian/Black Press Media)
In Surrey and White Rock, 64,000 people vote ahead of election day

Meantime, Elections BC has issued 68,396 mail-in ballots within the nine ridings

A reminder to students at Surrey’s Strawberry Hill Elementary to physically distance during the COVID-19 pandemic. (Photo: Lauren Collins)
Surrey’s Senator Reid reporting first COVID-19 exposure

INTERACTIVE TABLE: Search for schools, organize by exposure dates

Provincial health officer Dr. Bonnie Henry presents modelling of COVID-19 spread in B.C., March 25, 2020. (B.C. government photo)
B.C. sets another COVID-19 record with 203 new cases

up to 1,766 active cases in B.C., two more deaths

The Vancouver Canucks and Abbotsford’s Jake Virtanen have agreed to a two-year deal with an average annual salary of $2.55 million. (@Canucks Twitter photo)
Abbotsford’s Jake Virtanen, Vancouver Canucks agree to two-year deal

Two sides avoid arbitration, Virtanen will receive average annual salary of $2.55 million

Jordan Naterer, an electrical engineer from Vancouver, was last seen Saturday Oct. 10. (Facebook photo)
Search efforts to resume for missing Manning Park hiker; Trudeau speaks on case

PM says he’ll do what he can to ‘nudge’ efforts to find Jordan Naterer, yet has little leverage locally

Smartphone showing various applications to social media services and Google. (Pixabay photo)
National media calling for level playing field with Google, Facebook

In Canada, Google and Facebook control 80 per cent of all online advertising revenues

Join Black Press Media and Do Some Good

Pay it Forward program supports local businesses in their community giving

Swimco announced recently it is shutting all of its stores in Canada, including in Langley. (Swimco website)
Canadian-owned swimsuit chain bankrupt

Swimco had been in creditor protection for several months

École de L’Anse-au-sable. (Google Maps)
B.C. records first COVID-19 outbreak at school, six weeks after students return to class

Three cases of the virus have been identified at École de L’Anse-au-sable

Green Party leader Sonia Furstenau is seen as she leaves media event during a campaign stop in West Vancouver, B.C., Tuesday, October 20, 2020. THE CANADIAN PRESS/Jonathan Hayward
B.C. Green leader hopes voters see value in minority government

The Greens received nearly 17 per cent of the popular vote in 2017 yet received just three seats

Most Read