Report boasts blueprint for circularity

Making a PET bottle coloured instead of clear reduces its value in the South-east Asian recycling market by $84 a tonne, reports Singapore-based environmental consultancy GA Circular.

The finding, which is the result of two years of research, follows Coca-Cola’s recent decision to move Sprite away from coloured PET in the region. GA Circular studied the six biggest South-east Asian markets – Indonesia, the Philippines, Vietnam, Thailand, Myanmar and Malaysia – and found that coloured PET was priced at 35 per cent lower than clear PET in the collection and recycling market.

As a result, phasing out of the use of coloured PET beverage packaging is a key recommendation in the consultancy firm’s Full Circle: Accelerating the circular economy for post-consumer PET bottles in South-east Asia report launched together with Coca-Cola. The companies believe that the report provides a blueprint for circularity of PET bottles in the region.

The report is claimed to be the first of its kind to provide a systematic and comparable baseline of the flow of plastics packaging by studying PET bottles in five of the six countries that are among the top ten global contributors to ocean plastics leakage.

At the city level, 54 per cent of PET bottles are collected-for-recycling in these six countries on average (based on nine representative cities). The collected-for-recycling rate is estimated to be 26 per cent at the national level.

Across the six countries, a total of 660,000 tonnes of PET bottles was landfilled or leaked into the environment in 2018. This represented a loss in secondary material value of $199 million per year.

The informal sector is the backbone of collection for PET bottles in these six South-east Asian countries, contributing to 97 per cent of all PET collected-for-recycling in the nine cities studied – and thus any solutions for South-east Asia must include the informal sector.

The report highlights the need to boost post-consumer value chain by providing a price incentive to pull the material through the value chain (i.e. increase demand of PET bottles through key stakeholders of the recycling value chain). PET bottle consumption is projected to grow from 886,000 tonnes in 2018 to 1.52 million tonnes in 2030.

GA Circular calls on companies and industry in South-east Asia to adopt voluntary Packaging Recovery Organisations (PROs) focused on value creation mechanisms that benefit the informal sector and the value chain, and material end markets; and for governments to support with enabling policies and standards for the circular economy.

Similar models have seen success in comparable developing countries such as South Africa and Mexico. PET bottle collection and recycling rates have increased to over 55 per cent in both countries. As of 2018, South Africa has a 68 per cent recycling rate for PET bottles, with 100 per cent of the material recycled locally.

Ashwin Subramaniam, chief executive of GA Circular, said: “The report aims to shed light on the current realities for post-consumer packaging in South-east Asia. A realistic baseline is critical in informing the direction and nature of solutions to be implemented and this is what this report provides. A circular economy for PET packaging is 100 per cent possible in the region and it is our sincere hope that the recommendations outlined in this report are fully considered by industry, policymakers and investors.”