THE imposition of higher export taxes has increased prices and reduced the global supply of critical raw materials—a situation which the Organisation for Economic Co-operation and Development (OECD) said was caused by the decision of governments, including the Philippines, to raise state revenues.
In the Inventory of Export Restrictions on Industrial Raw Materials 2025, OECD said export restrictions on industrial raw materials increased by more than five-fold between 2009 and 2023.
The bulk or 94 percent of these restrictions in 2023 were imposed by The People’s Republic of China, Viet Nam, Burundi, the Russian Federation, Democratic Republic of the Congo, Zimbabwe and Laos.
“The incidence of export prohibitions, the most restrictive form of export restriction, has increased significantly since 2019. In fact, they were the most frequently introduced type of restriction in 2022 and the second most frequently introduced in 2023,” the OECD report stated.
“For measures where information on the officially stated purpose of export restrictions is available, revenue generation was the most frequently cited purpose in 2023—and it has been the fastest-growing stated purpose since the early 2010s,” it added.
The inventory done by OECD included all countries accounting for at least 3 percent of global production of any raw material. This included 82 countries such as the Philippines which are producing industrial raw material commodities.
“These countries accounted for 97 percent of the world production of minerals and metals, and 81 percent of world production of wood in 2022. This coverage essentially allows for the monitoring of export restrictions by all significant raw materials producers worldwide,” the report said.
Other measures
The report added that apart from higher export taxes, countries decided to impose export prohibitions on certain materials; licensing requirements; the imposition of export quotas; export surtaxes; and other export measures in 2022 and 2023.
OECD noted that export prohibitions have increased significantly since 2019 and became the most frequent type of restriction in 2022 and second most frequently introduced in 2023.
The data showed China and Indonesia both accounted for 18 percent each of these restrictions while Vietnam accounted for 6 percent. Other countries taken together—including the Philippines—accounted for 23 percent of these restrictions between 2009 and 2023.
“The effectiveness of such restrictions in achieving sustainable development goals is contested. Moreover, restrictions by one country often trigger similar actions by others—creating a cycle of rising prices and reduced global supply,” OECD said.
OECD stated that these materials are critical to renewable energy, digitalization, and defense. Electric vehicles would often require six times more mineral inputs than cars while onshore wind plants need nine times more minerals than gas-fired plants.
These minerals, the agency stressed, are vital for semiconductors, fiber optics, superalloys, permanent magnets, and advanced electronics.
It may be noted that the Philippines’s top exports and imports are electronic products, specifically, semiconductors.
Image credits: Nonie Reyes