Time for a new plastics economy

By 2050, there will be more plastic than fish in the sea if the world does not change the way it uses and disposes of packaging, says the Ellen MacArthur Foundation. A radical new approach to plastic is needed, and this could signal big business opportunities.

Asia, the economic powerhouse of the world, may be responsible for driving much of the global economy, but it suffers from a host of environmental challenges. For instance, two of its largest countries – China and India – jointly account for more than a third of global greenhouse gas emissions, and the region is home to the most polluted cities.

Now, a new study has found it is also the biggest plastic polluter.

According to the report released last month by the Ellen MacArthur Foundation and the World Economic Forum, Asia is responsible for 80 per cent of plastic leakage into the oceans because of lack of regulation and collection infrastructure.

The region, together with the United States and Europe, account for 85 per cent of plastics production.

Every year, at least 8 million tonnes of plastics end up in the seas, the “equivalent to dumping the contents of one garbage truck into the ocean every minute”, says the report, titled ‘The New Plastics Economy: Rethinking the future of plastics’.

If no action is taken, this is expected to increase to two trucks per minute by 2030 and four per minute by 2050. The oceans will have one tonne of plastic for every three tonnes of fish by 2025, and by 2050, more plastics than fish.

The Foundation, set up in 2010 by the British sailor it is named after, aims to accelerate the global transition to the circular economy.

This model advocates restructuring manufacturing and product design in a way that recycles materials in the value chain, and extending product lifespans through repair and refurbishment.

The McKinsey Center for Business and Environment helped analyse the data of the study, which began in 2012 and took three years. It was based on interviews with more than 180 experts in the field.

While the authors recognise that the plastics economy has delivered many benefits, it also has drawbacks that are becoming more apparent by the day. After a short first-use cycle, 95 per cent of the value of plastic packaging, worth between US$80 billion and $120 billion annually, is lost forever.

Only five per cent of plastics are recycled effectively, while 40 per cent end up in landfill and a third in fragile ecosystems such as the world’s oceans.

Much of the rest is burnt, causing harmful emissions. The subsequent production of new plastic bags, cups, tubs and consumer devices demanded by the plastics economy also consumes more fossil fuels, the authors say.

Plastic trash is also hurting Asia, with the Asia-Pacific Economic Cooperation (APEC) estimating that ocean plastics cost the region’s tourism, fishing and shipping industries US$1.3 billion a year.

Since 1964, plastics production has increased twentyfold, reaching 311 million tonnes in 2014, according to the report. This figure expected to double in the next 20 years and almost quadruple by 2050.

If this continues apace, the plastics sector will account for 20 per cent of total oil consumption and 15 per cent of the global annual carbon budget by 2050 – that is, the total emissions allowed if the global community was to achieve the internationally accepted goal of keeping global warming to under 2 degrees Celsius.

“Policymakers can play an important role in enabling the transition by realigning incentives, facilitating secondary markets, defining standards and stimulating innovation.”

The New Plastics Economy: Rethinking the future of plastics

Rethinking the plastics economy

Ellen MacArthur Foundation is now calling for a new way to looking at the plastics economy by applying circular economy principles to the global plastic packaging industry.

These include creating an “after-use” economy for plastics by increasing the use of recyclable and reusable packaging; reducing the leakage of plastics into the environment by improving the collection and storage of waste; and decoupling plastics from fossil fuels.

For this to happen, consumer goods companies, plastic packaging producers and plastics manufacturers would need to rethink the way they display and make their products, says the foundation.

Cities need to get involved as they control the waste collection and storage infrastructure, and are often hubs for innovation, it adds.

“Businesses involved in collection, sorting and reprocessing are an equally critical part of the puzzle,
 the authors say. “Policymakers can play an important role in enabling the transition by realigning incentives, facilitating secondary markets, defining standards and stimulating innovation.”

British retailer Marks & Spencer is one company singled out in the report that has shown leadership on addressing the issue.

It has, for instance, completely phased out hard-to-recycle PVC from its products and packaging, and ships 98 per cent of its goods from supplier to store in reusable packaging crates. These crates are used, on average, 300 times before they are recycled.

This is possible because the retailer has control over its supply chain – from production to shelf.

Companies and local governments all over the world are also working on projects surrounding the plastic economy. For example, the Scottish government created a materials brokerage service to match demand for high-value recycled plastics with supply. In France, recycled plastic supplier Suez launched a research lab last year to work on formulations that contain more recycled plastic.

In Italy, the city of Milan banned single-use non-compostable plastic bags two years ago and started making compostable ones. The move not only reduced plastic-bag trash, it also tripled the amount of food waste collected from schools, supermarkets, offices, restaurants and hotels.

The report suggests one way for companies to take the first step is to launch pilot projects. Companies can begin by asking: To what extent could plastic packaging be designed with a significantly smaller set of material/additive combinations, and what would be the economic benefits if this were done?

Another way is for the world’s leading businesses, academics and innovators to jointly develop bio-friendly materials, explore biomimicry principles, and create plastics that are more recyclable. Plastics such as PVC should be phased out, the authors say.

“Actors across the plastic packaging value chain have proven time and again their capacity to innovate,” they add.

“Now, harnessing this capability to improve the circularity of plastic packaging – while continuing to expand its functionality and reduce its cost – could create a new engine to move towards a system that works: a new plastics economy.”    

This story was first published on Future Ready Singapore. Visit the website to sign up to its newsletter.

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