While many urban areas in India, Indonesia, Thailand and Vietnam have a municipally managed waste system, the informal waste sector plays an important role in the collection, sorting and recycling of materials such as plastics. These plastic recycling chains are local and unique, because they are reliant on local conditions, traditions and cultures as well as local and regional infrastructures and markets. The Circulate Initiative, in partnership with the Anthesis Group, has therefore taken a closer look at plastic recycling in the countries mentioned above, taking these aspects into account. They analysed capital cities, mega or large cities with existing and functioning plastic recycling systems as well as regions with emerging plastic recycling systems that generate a large amount of plastic waste. The report focuses on municipal waste, which is the main cause of local environmental problems and appears to have the greatest potential for expanding waste collection and recycling. In India, about 60 per cent of plastic waste is collected in the informal sector. However, more than 30 per cent of the waste is still improperly disposed of. In the cities and regions included in the study, i.e. Delhi, Mumbai and Chennai, informal plastic recycling systems are well established, but also fraught with environmental and social issues. In the early 2000s, the Indian government introduced legislation to improve plastic recycling and prevent plastic pollution. These laws are among the main driving forces behind developing infrastructure and potentially diverting plastic waste to the formal sector, which could result in a significant expansion of the plastics value chain.
A major challenge identified by the study was the insufficient level of household waste separation. Even at transfer stations and material recovery facilities, only a few materials are sorted for recycling. Therefore, introducing a coordinated waste sorting system, extended producer responsibility and quality standards for sorting are recommended. MRFs should be given tax breaks, funding opportunities and subsidies to improve sorting technologies. Recyclers are struggling to secure a supply of materials with the appropriate quality, quantity and price, which threatens the economic viability of recycling facilities. Extended producer responsibility in combination with possible minimum recycling levels for certain products could enable the development of new supply chains. VAT reductions could also increase the demand for recyclates. In Indonesia, 60 per cent of the population is believed to have access to waste collection facilities. However, only about 10 per cent of plastic waste is sent to recycling plants, mainly by the informal sector. The rest is dumped, disposed of illegally or burned. The three cities and regions that were analysed, which were Greater Jakarta, Macassar and Surabaya, have a dynamic and comprehensive collection and sorting network. Yet, the overall proportion of domestic plastic waste collected is still low. It is currently competing with imports that provide more reliable quantities and qualities, making life easier for recyclers. Indonesia has several laws on waste management and there are more in the pipeline. But above all, an extensive infrastructure needs to be planned and developed.
Although almost all areas have access to household waste collections, the amount of recycled plastic is still very low and mainly consists of material collected by the informal sector. Therefore, introducing a formal collection for household recyclables is recommended. Extended producer responsibility should be established to generate sufficient financial resources to develop infrastructure. In addition, there should be a review of waste fees and how they are distributed. The study points out that the mismatch between existing recycling capacities and domestic waste generation makes it difficult to collect sufficient quantities and qualities of recyclable material with the existing system. The lack of formalisation limits the development of recycling. Indonesia has a good regulatory framework in place for recycling. Boosting extended producer responsibility and recycling quotas could increase both separate waste collection and recycling. Thailand generates an estimated 428,000 tonnes of improperly disposed plastic waste every year. However, the country is well on its way to creating local supply chains for plastic waste. This is largely due to an established and growing national recycling infrastructure operated by local and international players. An analysis of Bangkok, Chon Buri and Rayong shows that many companies have established formal recycling capacities. However, the collection of recyclables still mostly takes place in the informal sector. Plastics are not being separated at the point of generation, so collection rates are still low.
Without the formal and widespread separation of plastic waste, the growth rate of waste would be far higher. There are plans for extended producer responsibility and other initiatives, but concrete measures and implementation timeframes are still to be determined. The plastics recycling market is still very limited. Investment in infrastructure is therefore urgently needed. Tax incentives for the purchase of sorting and separation technology could be considered, as well as making it easier to obtain operating licences. Although Thailand has a large recycling infrastructure, many of the facilities are not economical to operate due to the low market prices. Moreover, there are not enough policy measures in place within the country to promote recycling. As a short-term solution, the study suggests paying subsidies to collectors. In the long term, however, a national market needs to be created to increase supply chain security. The supply chains in Hanoi, Ho Chi Minh City and Da Nang are very similar due to the strong involvement of state and local governments. The private sector only plays a minor role here. The study sees great potential for Vietnam when it comes to reducing its dependence on imported plastics and increasing recycling by strengthening domestic supply chains.
There is an urgent need to improve the separation of recyclables at source. At present, quantities and qualities are limited to material collected informally. It will take guidance, funding and monitoring to ensure effective implementation of the existing national legal framework, which should be supported by public awareness campaigns on separate waste collection. It is difficult for recyclers to obtain permits under the legislation because the procedures are not clearly defined. A consistent supply is not guaranteed due to reliance on the informal sector, which causes potential investors to be hesitant. Clear administrative channels for obtaining operation and construction permits for recycling facilities need to be established and responsibilities within the authorities need to be defined and communicated more clearly.
