It's far from easy to find positive news in these turbulent times. On 2 March 2022, though, genuinely good news came out of Nairobi, Kenya's capital city, where the international community agreed to take a common approach to the fight against plastic waste. At a UN Environment Assembly, the representatives of 175 nations embarked on negotiations on a global convention with the aim of commencing discussions on the concrete form before the end of this year. The legally binding agreement is to be ready by 2024. The "End Plastic Pollution" resolution covers the entire life cycle of plastic – from design through production to disposal. "Against the backdrop of geopolitical turmoil, the UN Environment Assembly shows multilateral cooperation at its best," said a delighted Espen Barth Eide, the Norwegian environment minister chairing the Assembly.
With more than 3,400 delegates in attendance and another 1,500 online, the conference in Nairobi were tackling an urgent problem: between 1950 and 2017, the worldwide production of plastic absolutely exploded from 2 million to 348 million tons. The UN's Environment Programme anticipates that the capacities of this industry – worth more than USDbn 500 – will double by 2040. Plastic production and pollution has far-reaching ecological and climatic consequences. It endangers the health of many people, causes enormous greenhouse gas emissions and threatens many species. "Every year, an estimated 11 million tonnes of plastic enter the world’s oceans," the UN Environment Programme has found. This quantity could triple by 2040. Consequently, leaders see the switch to a circular economy as an important way of solving the problem. It could deliver an 80% reduction in the contamination of the oceans with plastic by 2040 while at the same time triggering a fall of more than half in the production of plastic.
On top of this come high savings for the public purse as well as a decline in greenhouse gas emissions. At the same time, a consistent circular economy could itself unleash considerable value creation. The UN Environment Programme reckons on 700,000 jobs, primarily in the southern hemisphere. There is a need for a greater avoidance and recycling of rubbish in general, not just plastic. Ultimately, strong population growth is leading to ever greater accumulations of rubbish. According to a study by the World Bank, the amount of rubbish produced worldwide in 2016 came to a good 2 billion tonnes. The volume of waste is forecast to grow to 3.4 billion tonnes a year by 2050. More than 40% of the global amount of waste consists of food and green waste. While paper and cardboard account for 17%, plastic makes up a solid tenth (see graphs). There is also some cause for encouragement in this World Bank study, however: the authors are seeing a global trend towards more recycling and composting.
Even so, enormous efforts will be required if the growing mountain of rubbish is to be conquered – and this is where the international recycling industry comes into play. It is investing in new technologies and capacities on a grand scale. The market is already a huge one: according to Research and Markets, it had a volume of just under USDbn 400 in 2020. Alongside rubbish collection, the experts have factored the recycling of solid and disposal of hazardous materials into this figure. The global waste industry is expected to reach USDbn 715 in size by 2030. If this projection comes to pass, the market would grow by an average 6.1% a year. In light of these prospects, it is not surprising that "binmen" are in demand on the stock market. Take Waste Management, for instance: the share price of the US industry giant has far more than doubled over a 5-year period. That means the large cap has performed much better than the market as a whole.
Source: World Bank Group, Urban Development Series, "What a waste 2.0"; as at: 2018. Past performance is not a reliable indicator of future performance.
Source: World Bank Group, Urban Development Series, "What a waste 2.0"; as at: 2018.Past performance is not a reliable indicator of future performance.
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