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Model agreement on trade controls revised

Model agreement on trade controls revised

To help distributor companies with their chemical security, ICTA has long offered the model agreement on voluntary measures on substances subject to trade controls. This document helps companies to adopt a voluntary, risk-based approach to identifying and addressing vulnerabilities, and to improving vigilance and preventing incidents. It also supports companies to enhance their training and response capabilities, and to maintain reporting relationships with key stakeholders. The document has been updated with a reference to the new EU Explosive Precursor Regulation. See here.

China sets out its chemical industry policy direction for the next five years

China sets out its chemical industry policy direction for the next five years

China’s new five-year plan (FYP) for 2021-25 has been ratified by the National People’s Congress. It prioritizes key industries and technologies for accelerated innovation and development and emphasizes environmentally sustainable development. 

While international trade and investment were central to China’s growth the past decades, the focus in the  
FYP now shifts to building domestic markets. Quality is emphasized over quantity. Domestic demand for major chemicals is expected to maintain 3-5% growth over the coming five years. Analysis with thanks to ICTA partner CPFIC.

Central elements of the FYP are:

  • Innovation is central, with a focus on high-end materials in priority sectors including aerospace, electronics, energy, environmental protection, medical and national defense. The goal is to invest 1.5% of revenue in scientific research by 2050. Several national innovation centers and dozens industry innovation centers are to be established. 
  • By 2025, domestic supply sufficiency is expected to be significantly improved with reduced dependence on imported key raw materials and high value-added products representing 40% of exports.
  • Green sustainable development will be accelerated as a cornerstone of the chemical industry’s development. It entails improvement of green standards, promotion of green technology (including CCS) and products to reach the Chinese ambition to peak carbon emissions before 2030 and reach carbon neutrality by 2060. This will be supported by implementation of Responsible Care. By 2025, value-added energy consumption, water consumption and CO2 emissions must be reduced by 10% vs. the 13th FYP.
  • Digitalization is expected to improve production and operational efficiency throughout the chemical industry. A hundred pilot smart factories will be established and at least 30% of provincial and national chemical parks will be ‘smart’.
  • Industry will be upgraded to eliminate over-supply and inefficient production. At the same time production of new chemicals and materials will be promoted, focusing on materials for 3D printing, specialty fibers, functional pigments, UV-cured coatings and other high-value offerings.

ICTA offers list of substances subject to controls

ICTA offers list of substances subject to controls

It can be daunting to get an overview of all the trade limitations that may apply to a particular substance. As a starting point for this analysis, the ICTA Transport & Security Committee has produced a list of substances and the trade and voluntary controls that may apply to them. The list is only indicative and focused on EU/UK regulations. Nonetheless, the list provides a useful starting point for cross-reference for companies in countries with less developed chemical security legislation. See here

ICTA stresses importance of preventing diversion in chemical supply chains

ICTA stresses importance of preventing diversion in chemical supply chains

The G7 Global Partnership has revised its strategic vision to focus more on chemical weapons, a global culture of chemical security, capacity building and working with industry to raise awareness. In his role as chair of the Chemical Security Working Group, the representative of the Department of Homeland Security stressed the need to engage industry effectively. At that moment, however, ICTA was the only chemical industry representative in the room. It was noted that evidence shows Syria exploited weak links in international supply chains to source substances for their chemical Weapons of Mass Destruction program.

During the meetings the OPCW advised that their program and budget for 2019 had been approved. OPCW is recruiting for ten new posts to support the new work plan. There is broad support for OPCW’s work on verification, national implementation and terrorism, but some political divisions remain as key questions. There was for instance a perception that some members of OPCW sought to block effective OPCW action in response to the use of chemical weapons in Syria and UK (Salisbury). Verification planning in Syria is ongoing, but the planned work budget currently has a €800k shortfall. OPCW is also looking to fund cyber security, business continuity and physical infrastructure.

The EU gave a presentation stating that CBRN (chemical, biological, radiological and nuclear) threats are real. Internet terrorist propaganda and handbooks are spreading quickly, despite counter efforts. The attack in Salisbury was an eye opener at EU level. It has triggered actions to strengthen resilience to attacks with chemical weapons. The EU has therefore launched a CBRN Centre of Excellence initiative with €156m funding to build capacity. The EU is also developing a common list of threat chemicals, which it has almost finalized and is based primarily on the USA CBRN list. The EU’s next steps is to intensify dialogue with private actors in the precursor supply chain. The EU also wants to improve detection technology and first response capabilities.

On behalf of ICTA, Peter Newport welcomed the redevelopment of an EU list of threat chemicals. He pointed out that the existing list is based on risk perception, not science. He expressed the importance of taking a scientific approach when composing the new list and the importance of sharing the new list with industry. Without information sharing, there can be no effective control of listed substances. It became clear that the EU still concentrates on post supply chain diversion detection technologies, instead of on preventing the diversion in the first place. Meetings have been held with detector technology and equipment vendors, but not yet with chemical vendors. ICTA has expressed its firm belief that the focus should be on preventing diversion.

ICTA will continue to be involved with chemical security in 2019. Chemical security events in Bangladesh and Brussels (for EU & Turkey) took place and are expected to take place in March respectively.

The official report can be found here.

     
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