No Time to Waste: Diving into Plastics Circularity

The United Nations Environment Programme warns that 11 million metric tons of plastics are dumped into the oceans annually and without urgent action, this amount could triple in the next 20 years. The heavy burden of plastic waste has prompted government leaders, businesses, and citizens alike to weigh in on the need for a system-wide change to abate the crisis, which international nongovernment organization Environmental Investigation Agency deems to be almost equivalent to the threat of climate change. There is widespread recognition that reversing the rising tide of plastic waste requires a comprehensive life cycle-approach encompassing design, production, collection, consumption, disposal, and recycling of plastics—in short, solutions from source to sea.

As the epicenter of the plastic pandemic, Southeast Asia faces the imperative to break the plastic wave by not only tackling the symptoms of the unsustainable consumption pattern of "take, make, use, and dispose" but also focusing on its root causes. One study reveals that in 2015, a staggering amount of plastic waste leaked into the world’s oceans came from the region. According to the World Wildlife Fund, the economic impact of plastic pollution on Southeast Asia’s industries could reach $1.3 billion annually.

Despite the alarming statistics, there are reasons for optimism. At the Asian Development Bank (ADB) Healthy Oceans Tech and Finance Forum, promising examples from the region were showcased, demonstrating their success and potential to scale. The virtual event discussed practical pathways and solutions to enabling a transition to a circular economy.

Unwrapping circular plastic packaging

A circular economy is premised on the idea of keeping products and packaging in use for as long as possible and preventing them from ever becoming waste. It aims to address the source of the plastic pollution problem in the long term by changing the way plastic is produced and used.

One of the solutions tackling plastic products upstream at their origins is Indonesia-based Koinpack, a tech-enabled reusable packaging system for personal care products. It uses a deposit and reward model to replace sachets, a commonly used packaging designed for low-income consumers in Southeast Asia.

Koinpack’s solution comes in the form of reusable bottles that are available at its partner warungs or local convenience shops, allowing them to offer a refill and reuse option for customers who purchase shampoos, soaps, and other daily needs. This prevents single-use packaging from being created altogether and provides brands with a simple zero-waste opportunity to sell their products while maintaining affordability for Indonesian consumers. Customers also get a bonus for returning the empty bottles through cashback.

Koinpack’s initial success shows its scalability potential in Indonesia and other parts of Southeast Asia. “We grew 7 times in 2021 just in the Greater Jakarta area,” said Bintang Enkananda, director and co-founder of Koinpack. “In the next 5 years, our aim is to avoid 700 million sachets, and reach more than 25,000 customers, and 5,000 microentrepreneurs.”

Similarly, barePack in Singapore offers waste-free packaging based on a return model, enabling the delivery of meals in reusable containers. barePack has over 150 participating partners for takeaway orders, including GrabFood, Deliveroo, and Foodpanda. Containers are washed by the partner restaurants to ensure compliance with safety and hygiene standards.

ADB is also promoting plastics circularity in the region through its first certified blue loan to Indorama Ventures Public Company Limited (IVL), a global manufacturer and recycler of polyethylene terephthalate (PET) resin. ADB’s investment aims to boost the capacity of IVL’s plastic recycling plants in Indonesia, the Philippines, Thailand, and India, and support its goal of recycling a minimum of 750,000 metric tons of post-consumer PET bottles by 2025.

Neutralizing plastic footprint through community engagement and credit system

While it is encouraging to see the momentum building for the reuse-driven approach to eliminate waste, there is the persistent challenge of orphan plastics, which are ubiquitous in Southeast Asia. Orphan plastics are single-use plastics and packaging made of low-value material that are uncollected, mismanaged, and non-recyclable. 

In Viet Nam and Cambodia, TONTOTON is helping to address this issue by mobilizing local communities to rescue orphan plastics before they reach the oceans while also providing them with extra income for their waste collection. TONTOTON has set up collection centers in coastal villages that suffer from severe plastic pollution. It conducts educational campaigns and offers fair compensation to those who collect plastics for a living.

“The average daily income in these communities is around $3 a day, so this initiative has been life-changing for waste pickers who can now earn $15-$20 a day,” said Barak Ekshtein, founder and CEO of TONTOTON.

In addition to engaging communities, TONTOTON gets companies involved through its plastic credit system. Spun off from the carbon credit concept, this system allows companies to offset their plastic footprint by purchasing plastic credits based on the weight or tons of plastics they produce. The money spent on the plastic credits go toward environmental projects that seek to eliminate an equal amount of orphan plastics they generate, thereby helping companies to become "plastic neutral" one ton at a time.

The collected material is used as alternative energy to coal and raw material via co-processing in cement factories, reducing carbon emissions. Zero waste is another benefit from TONTOTON’s practice because ashes from burned trash are used in cement manufacturing. This creates a new market for orphan plastics and incentivizes waste pickers to collect them.

Enabling factors to build back bluer

To realize a fully circular economy, governments need to design policies that are necessary to eliminate single-use or non-recyclable materials, which end up in the landfill, get incinerated, or find their way into the oceans. The public sector should consider designing incentives to encourage circular economy innovations as well as investing in infrastructure for emerging packaging products such as compostable plastics to be able to manage such waste stream. 

In Thailand, for instance, the ban on single-use plastic bags is the first step in the country's long-term plastic waste management plan, which entails promoting eco-friendly innovations in packaging, offering incentives across the recycling ecosystem, developing recycled plastic content standards, and facilitating "waste symbiosis"—that is, taking waste from one sector that could be used as valuable input to another sector.

Equally important are knowledge and capacity-building initiatives to enhance the quality of recycling in the region, which mainly relies on the informal sector for waste management. Ill-informed practices in sorting and segregation by informal waste pickers often result in collected materials that are of insignificant value for companies to recover. This accentuates the need for education as well as technological solutions to build a well-functioning recycling ecosystem. Not only can technologies be leveraged to scale up high-quality recycling, but they can also create safe working conditions for informal recyclers.

Finally, building back bluer by striving for plastic-free oceans is not possible without financing. Against a fiscally constrained backdrop, public sector funding alone is not enough. Mobilizing private capital is key to meeting Southeast Asia’s climate and ocean financing needs, estimated at $210 billion annually. ADB’s Blue SEA Hub aims to accelerate the development of a pipeline of blue projects in the region and catalyze a large flow of public and private capital into these projects.

Given the inextricable link of ocean health deterioration to climate change and the region’s vulnerability to these threats, ADB Vice-President Ahmed Saeed struck an urgent note at the Healthy Oceans Tech and Finance Forum, stressing the need for comprehensive and rapid action at scale. “We need to move quickly to accomplish what is possible under current conditions while we work to improve the ocean finance framework. There is no time to waste.”

On 16–17 March, SEADS 2022 will look at solutions to build back bluer in the wake of COVID-19. Be part of the discussion. Learn, share, collaborate. Learn more about #SEADS2022.

This article was first published on the ADB SEADS website.