Turning ambition into impact: Actionable pathways to plastics circularity 

On the sidelines of the fifth session of the Intergovernmental Negotiating Committee (INC-5), in Busan, South Korea, the Alliance hosted a series of roundtables on key challenges and opportunities in waste management and financing the transition to circularity. These discussions brought together diverse stakeholders, including governments, industry representatives from across the plastics value chain, development finance institutions, technical experts, and civil society, including the informal sector, ensuring a wide range of perspectives were aired and considered, under the Chatham House Rule.  

Our discussions generated a number of insights: 

On Waste Collection and Deposit Return Schemes   

Waste collection is often overlooked as being key to successful downstream waste management although it has an outsize role in increasing plastic recycling rates and in so, contributing towards circularity. In addressing the complex question of how segregated waste collection be implemented, one must factor the complexity of implementing effective waste collection systems, particularly in Emerging and Developing Economies (EMDEs) while aligning them with environmental, economic and social goals. 

Governments of EMDEs have to address competing national priorities with limited resources. Accordingly, the highest volume of the environmental leakage of waste occurs in these countries, who have underdeveloped waste collection and management systems. To build financially sustainable waste collection systems, it is important to decouple waste management funding from the fluctuating market value of recyclate materials extracted from the collected waste. At the same time, there is a global necessity to develop robust offtake markets for recycled material, or pilot projects risk stagnation once external funding or subsidies taper off.  

The critical role of informal waste pickers in waste management systems was also widely acknowledged at this roundtable. An area of consensus was the importance of integrating informal waste workers. Aligning incentives, improving safety standards, and addressing ethical concerns were identified as key to ensuring a just transition for waste pickers as countries evolve waste collection systems. 

On Extended Producer Responsibility and Other Financing Models for Circularity 

 Extended Producer Responsibility (EPR) schemes can take five to six years to establish and one to two decades to demonstrate impact, so it is important that they are tailored to the specific objectives and conditions of the localities each scheme is intended for. Targets are one example; in EMDEs, initial priorities can be focused on improving waste collection rates rather than hitting ambitious recycling targets more suited for developed countries that already possess recycling infrastructure. 

There was broad consensus that funds collected through EPR systems should be earmarked for waste collection and recycling rather than becoming a revenue stream for authorities to deploy on other priorities. It was generally stressed that EPR is not a panacea for plastic waste management nor a “blackbox” to shoehorn all sustainability-related policy into and that other mechanisms are available to address issues tangential to plastic pollution. Complementary mechanisms include leveraging plastic credits as a means of impact-accounting framework, as well as keeping recycled content targets as a separate target with its own policies and frameworks. Having recycled content targets will also boost offtake markets for the sale of recyclates. 

On Catalytic Capital and Innovative Financing Models  

The scale of finance required to address the plastic pollution problem is vast. It is estimated that over $1.2 trillion will be needed by 2040 to eliminate plastic waste leakage into the environment. Bridging that gap will require a range of innovative financing models to unlock capital from development finance institutions as well as the private sector.  

Blended finance was generally agreed upon as a viable model to de-risk investments and catalyse large-scale projects involving private finance.  Impact funds already earmarked to accelerate the green transition can also be tapped as a vital tool for financing plastic circularity initiatives, which directly contribute to decarbonisation. Outcomes-based financing was also discussed, with innovative mechanisms like green bonds linked to tangible metrics; for example, the tonnage of waste recycled, as a scalable model. 

Developing countries face unique challenges in accessing financing for waste management and recycling projects, including reputational risks, perceived compliance barriers, and inadequate infrastructure. It is important to decouple funding from volatile material markets to mitigate financial risk while building compelling business cases and aligning with high operational and ethical standards.  

I would like to thank all of those who shared their expertise and insights. Challenges remain, but these discussions pointed to actionable pathways to accelerate the transition to a circular economy for plastics. The Alliance’s work leans into the complexities addressed in these dialogues to develop and de-risk innovative solutions and catalyse action across the plastics ecosystem. While we wait for an agreement to galvanise and guide that action, the collective wisdom demonstrated by the sector during these discussions indicates there is no shortage of willingness to solve the plastic waste challenge. 

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