By Inviroglobal team
GCC countries can generate commercial opportunities and jobs if they change their recycling practices. Every year, GCC countries produce around ten million tons of plastic waste, and nine million tons of scrap metal, with plastic and metal waste growing at much faster rates than the global average. A change in policy, leading to more plastic and metal recycling, would have positive economic and environmental effects. To recycle more, governments need to reinforce standards and guidelines, strengthen incentives and penalties, develop the operational ecosystem, and build the necessary capabilities and public awareness.
At present, GCC countries recycle very little compared to developed economies such as Germany and Japan. On average, GCC countries only recycle, reuse, or recover around 10% of plastic and metal waste. Countries such as Germany or Japan, which have embedded the concept of the circular economy into policy, can have recycling rates surpassing 90% for metal, and 40% for plastics (also reaching 90% for plastics including energy recovery). The low GCC recycling rate leads to losses of large volumes of recycled metals, which can be used as an alternative to virgin material, and recycled plastics, which have numerous applications, such as in construction and food packaging. Worse, plastic and metal waste can endanger wildlife, and the environment, and poor disposal practices can threaten human health.
By contrast, increasing recycling rates in GCC to an achievable target of 40% can create significant benefits. It would cut carbon dioxide emissions by 10 to 12 million tons each year and reduce primary energy consumption by around 4%. As local players companies see the commercial opportunity, we estimate that would create around 50,000 new jobs in the recycling industry, with a total market potential of around $6 billion per year. Investors in this sector can expect healthy operating margins of above 15% in various opportunities across the value chain, such as waste electrical and electronic equipment recycling, plastics and packaging recycling, secondary metal semi-finished producers, or car spare parts manufacturing using recycled plastics. However, considerable obstacles remain. Too often those companies producing plastic and metal goods do not make them easily recyclable because of a lack of guidelines and technical standards. There is a shortage of adequate recycling facilities, while community awareness of the issue is minimal. The necessary infrastructure and technologies are undeveloped or unavailable. Low levels of
