https://crsreports.congress.gov
Updated August 25, 2020
Export Restrictions in Response to the COVID-19 Pandemic
Overview of Export Restrictions
In response to the Coronavirus Disease 2019 (COVID-19)
pandemic, countries all over the world, including the United
States, have imposed temporary restrictions on exports of
certain medical goods and some foodstuffs in order to
mitigate potential shortages of key supplies. According to
the World Trade Organization (WTO), for G-20 countries,
export bans accounted for more than 90% of trade
restrictions related to the pandemic. Many measures are not
explicit bans, but vary from licensing requirements to
mandates for sales to the state. These restrictions have
raised debate about the consistency of such actions with
WTO rules and the potential impact on the global trading
system. Some markets depend heavily on countries that
have implemented restrictions. Most leading exporters are
also major importers of critical supplies, with integrated
supply chains at risk. The proliferation of such measures
has prompted some countries to commit to limit restrictions
or to abide by certain principles in their temporary
application. Some Members of Congress have weighed in
on the issue, both in terms of the immediate disruption from
COVID-19, but also on the future of supply chains.
WTO Rules
In general, WTO agreements are flexible in allowing the
use of emergency trade restrictions related to national
security or health that might otherwise contravene WTO
obligations; the agreements require, however, that such
restrictions be targeted, temporary, and transparent. Article
XI of the 1994 General Agreement on Tariffs and Trade
(GATT) broadly prohibits export bans and restrictions,
other than duties, taxes, or other charges. However, it
allows members to apply restrictions temporarily “to
prevent or relieve critical shortages of foodstuffs or other
products essential” to the exporting country. In the case of
foodstuffs, the WTO Agreement on Agriculture requires
members to give “due consideration to the effects on food
security” of importing countries. In addition, general
exceptions (e.g., GATT Article XX) within WTO rules
provide for policy flexibility, including to protect health,
provided restrictions do not “constitute a means of arbitrary
or unjustifiable discrimination,” or a “disguised restriction
on international trade,” among other conditions.
WTO leadership has emphasized the downside risks of
curbs on exports and urged members to restrain their use
and minimize disruptions to supply chains. The WTO has
also called on members to abide by notification obligations
and improve transparency on any trade-related measures
taken in response to COVID-19.
Recent U.S. Actions
In recent decades, restrictions on U.S. exports typically
have been applied to defense articles, dual-use goods and
technologies, crude oil, or sanctioned entities. On April 7,
2020, the Federal Emergency Management Agency
(FEMA), pursuant to the Defense Production Act (DPA)
and other authorities, issued a temporary final rule banning
the export of certain personal protective equipment (PPE),
including certain respirators, certain surgical masks, and
certain medical gloves, without explicit approval from
FEMA. The rule included various exemptions, including
exports of subject goods that are destined for either Canada
or Mexico. The rule also required FEMA to consider the
need to minimize disruption to supply chains, the
humanitarian impact of a restriction, as well as other
diplomatic considerations. The restriction applies to an
estimated $1.1 billion of U.S. exports (Figure 1). On
August 10, 2020, FEMA extended this temporary rule to
December 31, 2020.
Figure 1. U.S. Imports and Exports of Goods now
subject to FEMA’s Temporary Export Restrictions
Source: U.S. Census Bureau, U.S. imports for consumption and U.S.
exports for 2019. Based on HTS codes subject to FEMA restrictions.
Advocates of the policy argue that the measure is necessary
to prevent evasion of U.S. domestic anti-hoarding actions
by exporting goods to markets where they can command
higher prices. Furthermore, advocates contend the measure
was not an outright ban, but rather prioritized American
demand and granted FEMA the discretion to allow the
export of excess goods. Critics note that the United States
imports many more of the goods subject to the restriction
than it exports, thus imperiling U.S. supplies of those goods
should more of its major trading partners take similar
actions (Figure 1). Moreover, the United States is a net
importer of other kinds of PPE and critics worry that
counter export restrictions by U.S. trading partners might
quickly encompass other goods. Still others are concerned
about the impact of such restrictions on countries in Latin
America and the Caribbean, many of which rely on U.S.
exports of the restricted goods. As one trade economist
noted, “Jamaica … gets more than half of its total imports
of respirators, masks, and gloves from the United States.”
Export Restrictions Globally
By the end of July, nearly 90 countries had introduced
export restrictions as a result of the COVID-19 pandemic,
according to the WTO. Since January 2020, countries have
taken more than 197 actions banning or limiting the export
of certain products, according to Global Trade Alert
