Export Restrictions: A Negative-Sum Policy Response to the COVID-19 Crisis

Abstract

Many countries, including China, European member states, the European Union, India and the United States have put in place measures to restrict exports of medical products as part of their response to the COVID-19 pandemic. The objective is to allocate domestic supplies to national healthcare systems and citizens. These policies break supply chains that rely on sourcing of inputs from different countries, reduce access to critically needed supplies and foster excessive price spikes and volatility, and generate foreign policy tensions. Experience with widespread use of export restrictions by food exporting countries in times of market disruption and supply shortages suggests a priority for the G20 should be to work with industry to put in place systems to enhance access to information on production capacity, investments to boost supplies and address supply chain bottlenecks affecting production and trade in essential medical supplies.

Keywords: Coronavirus; COVID-19 pandemic; export restrictions; trade policy; G20