Plastic mismanagement costs Philippines $890 million yearly

MANILA, Philippines — The Philippine economy is losing as much as $890 million (P43.25 billion) annually amid the country’s failure to ramp up plastic recycling among various industries.

In its latest study, the World Bank Group said only 28 percent or 292,000 metric tons of the 1.1 million MT various plastics consumed in the Philippines is being recycled.

This means that 78 percent of the material value of plastics, equivalent to about $790 million to $890 million (P38.38 billion to P43.35 billion) per year is being lost in the economy.

World Bank country director Ndiame Diop said mismanaged plastic waste across the Philippines and other countries is threatening key economic sectors such as tourism and fisheries, and impacting livelihoods and infrastructure.

“There is an untapped opportunity to reap environmental and economic benefits with clear and complementary interventions from the private and public sector,” Diop said.

The Philippines remains heavily reliant on single-use plastics that are discarded rather than recovered and recycled, and such is still an untapped business opportunity if key market barriers can be addressed.

“But there is strong government momentum in the country to identify critical policies, and craft roadmaps to strengthen demand for all recycled plastic resins, level the playing field for global and domestic companies, and help drive a circular economy for plastics,” Diop said.

Globally, the World Bank said $80 billion to $120 billion worth of plastic packaging is lost from the economy due to lack of recycling and sub-optimal value creation where recycling exists.

Some 4.8 to 12.7 million MT of plastic leak into oceans each year, with Asia contributing to over 80 percent of the marine leakage.

Unfortunately, the Philippines is the third largest contributor with an estimated 750,000 MT of mismanaged plastic entering the ocean every year.

The study emphasized that the billions in pesos of losses is due to several challenges that the Philippine plastic recycling industry is facing.

Among these include high logistics cost that limits recyclers’ ability to source feedstock across the country and high electricity costs, especially as many recyclers operate with low-efficiency equipment.

There is also intense competition from the informal recycling industry that distorts the market for formal recyclers who bear the costs of taxation and compliance with environmental, health and safety regulations, which the informal recyclers do not.

Further, the World Bank said tipping fees in the country are among the lowest in Asia, which discourages local government units from investing in and supporting solutions on waste management.

As a solution, the World Bank has recommended interventions to increase recycling rates from the current 28 percent and unlock significant additional material value from recycling plastics.

These could unlock material value of $180 million to $640 million (P8.74 billion to P31.1 billion) per year.

Among the interventions include increasing waste collection and sorting efficiency of post-consumer plastics and setting recycled content targets to enable the growth of a strong domestic market for recycled products through increasing the demand for post-consumer resin.

The World Bank also suggested a national design for recycling standards for all major plastics products, especially packaging, and encouraged increase in recycling capacities.

The Philippines is also urged to create industry-specific requirements to increase plastic waste collection and recycling rates and restrict disposal of waste plastics and incentivize the phase-out of plastics.