The Global Plastic Predicament.

The responsible recycling of plastic remains a significant and escalating problem worldwide. One single-use plastic bag, for example, takes 450 years to degrade and since the 1950s, 8.3 billion tonnes of plastic has been produced with c.76% of those tonnes remaining as waste and destroying ecosystems, wildlife and hygiene. Temporary measures, such as bans and quotas, aren’t proving sufficiently effective on a global level, despite their best intentions, and therefore many argue a longer-term, more pragmatic solution is required.

As discussed in our recent blog post, China has heavily restricted the import of plastics. Previously acting as the ‘go-to’ option for a number of countries, such as the UK, this has led to a bleed of surplus material into neighbouring countries as the massive unrelenting flow of material is reallocated. As observed in the publication by, the data initially indicates that a significant level of growth in plastic imports has been observed in countries such as Malaysia, Vietnam, Thailand, India, Taiwan. The percentage shift between 2016 and 2017 for these countries is massive and this relative growth is expected to continue throughout 2018. Despite the broad indication of growth in these markets as a close correlation to China’s adjustment, it is important to acknowledge other factors (such as wider global growth and international trade) are likely to have had some impact, but probably minimal compared to the main issue – to accurately conclude, further data investigated would be required. The sheer size of China simply means that the level of material dispersion to neighbouring countries is almost consistently guaranteed and thus an effective solution is required. The result of an approximate 50% reduction in feedstock has meant that many Chinese companies have shifted much of their operations over to these neighbouring countries as they are unable to produce the required level of output (i.e. rubber granules) to make their domestic operations commercially viable and sustainable. Reuters reported on the Jinhiui factory as an example. This was a decent sized factory in mainland China, employing 400 workers, and since the central decision to reduce imports, Jinhiui has decided to lay-off 250 workers in China and hire over 600 in Malaysia. Furthermore, the Malaysian factory has been set up entirely with Chinese equipment. This suggests a broad appetite almost total replacement and replication. Across China estimates range around 1,000 recycling companies (roughly 33%) have relocated their facilities, expertise and operations outside of the country. On the other side of the argument, the UK has tripled its exports of plastic materials to Malaysia in Q1 of 2018, as published by HMRC, in what appears to be a direct response to the Chinese ban. The majority of UK suppliers are now actively searching for alternative locations to place their plastics across Thailand, Malaysia, Taiwan and Vietnam. The UK has seen a 97% reduction in exports to China and similarly a 71% reduction to Hong Kong. Subsequently this has meant that a number of these countries are now reviewing their own recycling policies. Many consider the most concerning aspect to be that these 4 countries lie within the top 10 countries letting plastic enter the oceans. This comes down to, often, less effective waste management infrastructure

“UK Government to increase overseas spending on waste management projects after releasing a report with the Chartered Institute of Wastes Management (CIWM), which found that plastic in the world’s oceans is inextricably linked to poor waste management in developing countries.

It’s a similar story for Japan. As a result of the Chinese growing awareness that plastics contain toxins and its desire try to contain its already vast recycling problem, Japan too has been dealing with an overload of surplus material. As SCMP reports, before the ban 510,000T of plastic was shipped from Japan to China per year. In comparison, just 30,000T were shipped in Jan to May of 2018. To compound the issue further on the domestic front, Japan, perhaps surprisingly given its strong proficiency on technology, doesn’t have sufficiently productive waste management companies to deal successfully with the material. The Japanese government has therefore since outlined its commitment to increase investment in its recycling via a subsidy explicitly focused on improving facilities; ““we will now cover half the cost of introducing equipment to recycle plastics,” said Hiroaki Kaneko, deputy director of the ministry’s Recycling Promotion Division.” In 2018, the investment stands at 1.5bn Yen, USD 13.5m. Furthermore, there has been a drive to improve public awareness and engagement on local and national levels with, for example, the importance in reducing the number of single use plastic bags. Much of the public have a strong appetite for these bags as they are viewed to be hygienic, clean and practical and therefore a long term, educational based policy will be required to bring about change. OCI spoke directly with Tony Wong, a Director of Magic Falcon Limited. Tony has extensive experience within the recycling industry, particularly in regard to plastics, and has worked across China, Malaysia, Vietnam, Taiwan and Thailand (MTTV). Tony believes that many more than 1000 companies have in fact made the made the migration from China across to MTTV but in real terms the impact to the Chinese labour force has in fact been limited. One interesting aspect regarding these countries is that the tax duty to repatriate funds into China is nil and therefore this has led to a more malleable workforce, one that seems more willing to relocate providing they can send back the funds home. This is also compounded with the fact that Malaysia, for example, has a high cost, low supply labour force at present which means that the Chinese can act as a strong substitute. Tony also acknowledges the importance of these countries in understanding the possible economic benefits of this industry that has been pushed onto them, but that it is of equal importance that it is operated in a responsible and sustainable manner. THe MTTV countries are at risk of following the same path that the Chinese followed in terms of rapid expansion of industry, followed by dramatic rises in pollution. Tony recognises that around half of the Chinese owned companies in MTTV are actually skimping on investment in their facilities. In turn, this unfortunately means that the image and reputation of these plants with heavy investment and responsible practices are being tarnished. To balance this argument, Tony firmly believes that how the operations are viewed on the general market are solely down to the discipline of the owner in how they manage their facilities and production. With an increase in auditing across companies’ supply chains and increased surveillance from authorities, he believes that market forces will simply mean that these businesses will be eradicated. In addition, with the advent of the camera cell phone through to drones, it is becoming more and more difficult for companies to hide their poor practices and Tony firmly believes that this increased transparency is a true positive for the industry, its reputation and sustainability. To conclude, clearly significant and swift change needs to be enacted in order to tackle the world’s escalating problem with plastics. This clearly isn’t redistributing the material/problem around to different countries to let them reap some short term economics benefits whilst destroying their environments, ecosystems and habitats in the longer term. Instead, sustainable response is required. Whether this be educating the population that single-use plastic bags aren’t their only option, developing chemical and bacterial compounds to break down the material or to reduce the level of plastic entering the waste system in the first place. OCI is committed to responsible and sustainable end to end management of waste products. We work closely with our partners around the world, in line with regulations from the appropriate Environment Agencies and complying fully with international laws, to make sure that any material is placed appropriately OCI is able to leverage its extensive end user network to be able to adjust to changes in markets. If you require assistance with any of your products, please contact OCI via any of the methods listed below: Web: Email: Telephone: +44 (0) 203 137 7326