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An economic modelling study of three African countries – Côte d’Ivoire, Kenya and South Africa – shows that a shift towards a circular plastics economy will generate more economic activity and create more jobs than a business-as-usual scenario.
A new report from the World Wide Fund for Nature (WWF) shows that a shift to a circular plastics economy by 2050, will lead to positive cumulative effects for Côte d’Ivoire, Kenya and South Africa resulting in additional GDP growth and overall improvement in public welfare and household income than the current system.
This requires a shift away from the current linear (‘take, make, waste’) model which sees the bulk of plastics finding its way into non-compliant landfills and open dumps with resultant leakage into the natural environment. A circular economy endeavours to keep materials within the economic system for as long as possible reducing the need for continued resource extraction and trying to cope with the ever increasing volumes of waste.
Three core requirements to represent the circular plastics economy scenario in the macro-economic model from 2019 to 2050 were as follows:
- A reduction in overall consumption of single-use plastic packaging by 30%, including a phase-out of problematic polymers and formats
- 50% of virgin plastic to be substituted by post-consumer recycled plastic
- Wide adoption of packaging reuse and refill models to keep plastic packaging in the economy for longer periods
This new report comes against the backdrop of a decision at the most recent United Nations Environment Assembly in Kenya, Nairobi, to work towards a legally binding international agreement on how to manage plastics across its life cycle from resin production to end of life.
The report argues that this proposed treaty is an opportunity to “harmonise, coordinate and provide regulatory measures to address plastic pollution holistically and comprehensively”. It further suggests that African governments should actively participate in negotiations towards such a treaty to offer perspectives and priorities from the African context.
The research, which is the first of its kind to be done in Africa, looks at the economic benefits of the transition to a circular plastics economy by taking into account not only the market and indirect costs or externalities of the linear plastics economy, but also the net material savings, mitigation of price volatility and sectoral shifts that would result in job creation and improved livelihoods in the selected African countries.
In terms of the country scenarios, the report found that only for the packaging sector (or value chain):
- An immediate implementation option enables Côte d’Ivoire to benefit from additional GDP growth of $1,1 billion over a business-as-usual outcome and savings of over $200 million by 2050, by avoiding the costs arising from the externalities of the linear plastic packaging model.
- Kenya could also immediately implement structural changes towards a circular plastics economy to benefit from additional GDP growth of $2,53 billion and savings of over $425 million by 2050 by avoiding the costs of externalities that would accumulate in the business-as-usual scenario.
- In South Africa, delaying implementation would lead to an accumulation of costs of over $475 million by 2050 associated with the business-as-usual scenario. Incremental implementation of the transition to a circular plastics economy would enable the country to implement the necessary measures to minimise any negative impacts on the current value chain and still benefit from additional GDP growth of $7,2 billion.
The report says that a shift towards a circular plastics economy will lead to an overall increase in the demand for both skilled and unskilled labour, which suggests that there is strong potential for an inclusive circular plastics transition. The results also show that a significant number of informal waste sector workers and waste sector dependants stand to benefit from a transition to a circular plastics economy.
While employment is expected to decline in primary plastics sectors over the transition period, these sector-specific employment losses will be absorbed by growth in the secondary plastics and services sectors. This has implications for the need to design and ensure an inclusive plastics transition, even with more vulnerable groups downstream in the secondary plastics and services sector benefitting. The term Just Transition still needs to be contextualised in the plastics space in South Africa. The question to ask is where does social vulnerability lie in these value chains? Livelihood vulnerability in the plastics sector is very different to the energy sector and might therefore need to be approached differently.
The report focuses on plastic packaging at the macroeconomic level and therefore considers plastics in aggregate, rather than a delineation of the different types of plastic in detail. It is aimed at stakeholders in the government, industry and academia, as well as civil society and non-governmental organisations in Africa. It presents an economic case for the transition to a circular plastics economy, acknowledging the pressures to develop the national economies and create business opportunities for citizens in each country.
The African Circular Economy Alliance (ACEA) has identified plastic packaging as an area that offers immediate opportunities for increased circularity. African demand for plastic products, and packaging in particular, has grown significantly, driven by growing populations, rising income levels, urbanisation, improved market access and industry growth, produce expansion and diversification, and increasing household consumption. The plastics industry is essential to the supply chains of a wide range of strategic areas of the economy; therefore, the added value plastic brings to other sectors is one of the most remarkable features of the plastics industry.