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Thomson Reuters
By David Stanway
TAICANG, China (Reuters) – In a smoky factory about 50 miles northwest of Shanghai, masked workers dump bags of plastic waste into old machines that turn them into pellets used to make a range of manufactured goods .
But while the factory, operated by Taicang Jinhui Recycling Co, remains a hive of activity, the company has transferred much of its capacity to Malaysia as a result of China's restrictions on imports of recycled plastic which came into effect this year.
The borders of imported waste have deprived recyclers about half of what they need to produce plastic pellets that they sell to manufacturers of products ranging from office furniture to fiber optic cable ducts. . And with the domestic offer hard to find, many had no choice but to move abroad to stay alive.
"Here in our industrial park, we are the only company that is still producing – another 22 companies have ceased operations and are only warehousing or whatever, and all their staff has disappeared," said the Jinhui chairman, Thomas He.
Jinhui has fired 250 workers out of its workforce of about 400 since the restrictions came into force, although it has hired 600 others in Malaysia. The Malaysian factory was created almost entirely with Chinese hardware and technology.
According to China Scrap Plastic Association (CSPA), the company is one of more than 1,000 recycling companies – a third of the Chinese total – to relocate its expertise, equipment and channels. supply in Southeast Asia. 10 billion yuan (1.54 billion dollars). The association did not provide breakdown.
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China's decision last July to stop importing 24 types of foreign waste, including plastic, was part of an effort to improve its economy and tackle rising volumes. of domestic waste obstructing its watercourses or untreated in large cities.
Now, the Southeast Asian countries, already grappling with their own household waste problems, will have to tackle the same problems as the waste imports.
The Chinese ban disrupted a global supply chain that has allowed more than 7 million tons of plastic waste, mainly from Europe and the United States, to be transported to Chinese ports every year.
While this offer is drying up for Chinese recyclers, they have created 4 million tons of new capacity outside of China in operations that can receive imports from countries like the United States and the United Kingdom, Wang Wang said. , president of the ACPS. But it is still not enough to offset a supply deficit of about 6 to 8 million tons of recycled plastic.
"As for our businesses, they simply do not have enough raw materials," Wang said.
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DOMESTIC WASTE
Efforts to have recyclers take on more household waste are progressing slowly; According to ACPS figures, only 5% of national recycling companies have been able to switch to local sources of waste.
"The handling of imports and processing of domestic materials are two very different channels and it will take time to pass," said He Jinhui.
Recyclers said the government's sudden ban left no room for maneuver, and China failed to develop the necessary policies to intensify and standardize household waste treatment, which is generally managed. by small farmers.
Since foreign materials are still the best option, companies hoped that the transfer to countries such as Malaysia and Thailand would allow them to deliver foreign waste processed to China in a superior form, but their shipments were delayed.
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Customs are under pressure to ensure not only that imported pellets meet stringent standards, but also that containers are not used for the smuggling of low-grade legal waste, and that cargo is the only way to ensure that it is safe. subject of much further examination.
MORE RESTRICTIONS?
The move to Southeast Asia has eased some of the disruptions caused by the ban on businesses in Europe.
"We continue to export significant volumes, but to different destinations," said Roger Baynham, head of the recycling division of the British Plastics Federation.
But as foreign waste accumulates in countries like Thailand and Vietnam, Chinese recyclers face more risks.
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"Nobody wants this waste and the industry is concerned that these other countries will impose their own restrictions," said a China-based leader, with a recycling company abroad who did not want to give his name .
ACPA said Thailand is tightening regulations and increasing import taxes, as a Chinese importer has already been forced to shut down. Malaysia has also temporarily suspended new applications for import permits in mid-May.
Jinhui He said he was worried that the import rules are likely to become more severe in the region amid environmental concerns.
"There is no way for China to import this stuff again," he said. And Southeast Asia "will become more standardized and regulate more rigorously".
In the end, bans in China and restrictions imposed elsewhere could force the original countries to step up their own recycling efforts, said Baynham of the British Plastics Federation.
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"The irony here is that the pulse comes from China, as opposed to economies like the UK, which was happy to accept a prison exit card in terms of strategy. recycling, "he said. .
"It is now time for the developed world, and the United Kingdom in particular, to accelerate."
($ 1 = 6,5025 yuan)
(Report by David Stanway, edited by Philip McClellan)
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