In 2018, China, the world’s largest importer of scrap paper and plastic, threw the international recycling industry into chaos after it suddenly imposed restrictions which effectively stopped the flow of scrap imports. Following China’s step back, many ASEAN nations welcomed scrap plastic imports, hoping to capitalize on growing global demand. Yet, after serious environmental and labour concerns, one after the other ASEAN countries have followed China’s suit in restricting or altogether stopping scrap imports. The message is clear: Southeast Asian nations are no longer willing to be dumping grounds for overseas waste.
The global trade in plastic scraps is an industry which generates around US$200 billion every year (Allan, 2019). It is generally understood that scrap materials have value and have the potential to be reused or reprocessed. On the other hand, waste has little to no value and likely has harmful environmental and health effects. Therefore, scrap can be capitalized on and can create a profit for importers, whereas, waste is viewed as a burden. Globally, around half the plastic intended for recycling is traded overseas (Hook, 2018). Many countries choose to export plastic and paper materials to Asia as it is easier than dealing with it locally and it is often far cheaper to process. For this reason, 75% of globally exported waste ends up in Asia. Australia, for example, sends 50-60% of plastics collected for recycling to Southeast Asian nations (Dominish, 2019).
The major problem with the global trade in scraps is that wealthier countries who are arguably better equipped to process waste and recycle scraps choose to pass on responsibility to countries with fewer resources. This leads to mismanaged waste: when plastics are disposed of in open landfills or dumps, burnt, or discarded in ways which can spill out to the surrounding environment. Mismanaged waste is significantly higher in low-to-middle-income countries.
Why has China stepped away from the industry?
After joining the World Trade Organization in 2001, China became a manufacturing powerhouse and the world’s largest importer of recyclables, importing over half of the world’s paper and plastic scrap exports during the height of its imports (O’Neill, 2019). Once materials were recycled and re-processed, they could be re-incorporated into the manufacturing supply chain (Minter, 2019). As China was ramping up global exports, it was cost-effective to return containers filled recyclable materials instead of returning them empty. Additionally, as the Chinese manufacturing sector was not producing enough virgin plastic there was demand for recycled plastic. Not only was China paid premiums for importing scraps, but it was also able to turn a profit and meet domestic manufacturing demands.
However, all this changed in 2018 when China introduced “Operation National Sword” and effectively shut its doors on recycling scrap materials through stringent import restrictions. It can be viewed as a ban as it has set the bar extremely high in terms of the cleanliness of materials allowed in. While no one is sure of the exact reason for the policy shift, some point to the large amounts of contaminated and hazardous materials imported, rising labour costs, and a drop in the prices of plastic and paper scraps (Hook, 2018).
The increased media scrutiny over environmental and health issues caused by informal recycling plants, as well as the exposure of corruption in the industry, made the issue one of national pride. Domestic waste systems were neglected and under-managed whereas the facilities that managed imported recyclable scraps thrived (Minter, 2019).
The government has since cracked down on informal recycling plants in an effort to build newer, safer, and more efficient recycling systems. The move shows that China is trying to clean up its environment and assert its position as a major power in the world. “Operation National Sword” has fundamentally altered the global waste market and how we perceive international recycling processes. The industry has finally been exposed for what it truly is; mired by smuggling, corruption, and detrimental environmental and health effects.
Why the Global North relies on Southeast Asia to deal with its waste
There has been a long historical pattern of wealthier countries sending scrap plastic to poorer countries to be recycled. The United States routinely shipped dead car batteries, mercury-laced concrete and other toxic materials to under-regulated Southeast Asian nations in the past (Bengali, 2019). Unfortunately, these practices continue today as contaminated and dangerous waste, such as electronic waste, find their way into the countries that are the least able to deal with them safely. The wealth disparities and lack of legal remedies have enabled these dangerous trades in the past, however, there appears to be a shift due to rising nationalism and changes in trade practices.
China’s decision has consequently shifted the flow of waste to Southeast Asia, diverting over 3 million tons annually to countries such as Malaysia, Indonesia, Thailand, Vietnam and the Philippines (Marks, 2019). Although, even when Southeast Asian countries are considered collectively, they cannot match the efficacy or scale of China’s recycling plants and industrial base, leading to a global plastic waste crisis (Bengali, 2019). As Southeast Asian countries do not have the same capacity as China to handle a large amount of foreign scrap material, it has led to a vicious cycle of waste mismanagement. The influx of falsely labelled non-recyclable scraps or contaminated waste has placed undue pressures on already weak systems and created resentment towards the countries who produced the waste.
ASEAN nations fight back: restrictions and returns
Southeast Asia’s shift the forefront of plastic imports, has seen the accumulation of containers of trash and the proliferation of informal and illegal recycling facilities. This has contributed to severe pollution on top of an already dire plastic litter problem in the region.
In Vietnam, more than half of the imported plastic is sent to “craft villages” and other informal sites. At a household level, there are even greater environmental impacts from waste processing as more energy and water are required. After plastic piled up at ports in Vietnam over 2018, the country found itself at its limit and declared it would not “become the landfill of the world” (Hook, 2018). The Vietnamese government has since stopped issuing licences for imports of paper, plastic, metal and other waste. There are similar scenarios throughout the region.
In Malaysia, a string of illegal factories set up by Chinese businesses, who previously relied on China’s imports, created significant pollution as a result of substandard practices. In addition, what was believed to be imported scrap was actually found to be household and electronic waste, imported under false declarations from several countries, including Australia. Following such discoveries and the deluge of hazardous and non-recyclable waste, Environment Minister Yeo Bee Yin, earlier this year called time on Malaysia’s role as “the plastic rubbish bin of developed countries” (Massola & Rosa, 2019). In June Malaysia sent 3,300 tons back to the source countries (Minter, 2019).
Countries including Thailand, Indonesia and Vietnam have now refused to take in certain materials for recycling. In addition, the Philippines, Indonesia and Malaysia have begun to send waste back to their shores of origin, including Australia, due to hazardous contents and a lack of informed prior consent. The move is a combination of unfair trade practices and the realisation of countries that the current system is no longer beneficial.
ASEAN member states are among the world’s biggest sources of plastic pollution. According to a 2017 Ocean Conservancy report, China, Indonesia, the Philippines, Vietnam and Thailand, contributing to more than half of the plastic waste in the ocean (Ocean Conservancy, 2017). Awareness of the scale of the issue has only grown, with ASEAN members recently vowing to tackle domestic pollution through the “Bangkok Declaration” at an ASEAN conference earlier this year. As Southeast Asian nations have momentous domestic waste challenges to contend with, foreign imports are losing their appeal. Why import scraps and waste to little economic benefit and at the cost of quality of air and water and the health of citizens.
A potential trash trade war?
As more and more countries pushback and shut their doors to scrap materials upon discoveries of toxic and hazardous imports, countries may no longer be able to depend on Southeast Asia to process its waste. This trend can, in part, be associated with rising nationalist sentiments and brewing trade wars in the Asia Pacific region. Countries conceptualize the waste issue as a matter of sovereignty and national pride. To accept hazardous waste on misleading claims is to submit to greater powers.
There are significant potential knock-on effects if the global trade in waste and scrap comes to a halt, which would require Australia, among other countries, to build up domestic facilities rapidly or incur major fallouts. If they fail to find alternatives in time, materials that are potentially recyclable will be left in stockpiles or sent to landfill.
The Philippines has perhaps seen the most bitter diplomatic dispute with Canada. Canada sent dozens of containers falsely labelled as plastic scrap which were revealed to contain household waste, plastic bags, bottles, newspapers, and even adult diapers (Bengali, 2019). The Philippines demanded the containers be sent back, though Canada maintained it could not intervene in private commercial transactions between Canadian and Filipino companies. President Rodrigo Duterte intervened and threatened to “declare war” over the issue, removing diplomats from Canada in the process. Eventually, the Canadian government agreed to return the containers. This example shows the potential for breakdowns in diplomatic and trade relations.
The evolution of the international waste regulatory framework
The Basel Convention was adopted in 1989 to prevent shipments of hazardous waste from wealthy to less-wealthy nations and to introduce a liability protocol which assigns financial penalties in such incidents. Though, until this year, these goals appeared to be a pipe dream. The Norway Amendment to the Convention was proposed in May 2019 at a UN conference to address gaps in the treaty and to gain better control over the flow of “problematic waste” (Hook, 2018). Over 180 countries agreed to expand hazardous material to include plastic waste and the requirement of “prior informed consent” of importing countries (Cossar & Sangaralingam, 2019). This allows countries in the Global South to send back waste on the basis of false or misleading declarations and prevents dumping.
While all Asian countries approved the move, not everyone was pleased with the outcome. The proposal has been opposed by the United States (the largest plastic exporter in the world), the petrochemical industry and scrap traders. They believe that the policy would stifle trade and could potentially worsen the world’s plastic problem (Cossar & Sangaralingam, 2019). Yet, this action will force exporting countries to take responsibility for their own plastic problem, rather than simply exporting pollution. Additionally, as the United States is not a party to the Basel Convention it has no voting rights and will still be banned from trading contaminated waste to most of the Global South – a significant victory for the environment.
How do we solve the plastic waste crisis?
Arguably the solution lies in creating a global circular economy and investing in green growth solutions. A circular economy extracts the maximum value from materials and finds innovative solutions so that they stay in the supply chain for the safest and longest period possible. This can be achieved through long-lasting design, maintenance, repair, reuse, remanufacturing, refurbishing, and recycling (Circular Economy Crucial for Paris Climate Goals, 2019). Circular principles could enable vast reductions in greenhouse gas emissions and contribute significantly to meeting Paris Agreement targets. At present, only 9% of the global economy is circular, yet global use of materials continues accelerating (Ibid).
Curbing plastic waste requires broad global action and building up relevant international law to safeguard and not stifle green growth. A circular economy requires strong national waste legislation and processes that elevate individual efforts to recycle. It encourages a culture of reuse and remanufacturing: creating industry opportunities and enabling consumers to make informed purchasing decisions. Scrap material can be either a resource or a burden, depending on how it is dealt with. In a circular economy, we all stand to gain from the waste trade. It should not be a matter of passing on the burden to the poorest countries with the least means to deal with the problems.
While ASEAN nations, in enforcing international regulations and refusing hazardous waste, are sending an important message to countries to take more responsibility for their waste, nationalism and protectionism are ultimately counter-productive in addressing global environmental issues. Without collective action and a circular economy, we will not be able to meet the targets of the Paris Agreement and solve the global plastic pollution problem. Furthermore, we cannot reduce pressures on global recycling systems unless the global production and consumption of plastic are dramatically reduced.
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