The transition to a circular economy, including the move to a form of full Extended Producer Responsibility, invariably requires adapting international models to local political, economic and environmental circumstances. In many developing countries, one of the most challenging questions is how to incorporate the existing and often well-entrenched informal waste recovery sector within regulatory models which make international product makers the responsible party for operating reverse supply chains for their end-of-life goods and related packaging. Circular economy makes for strange bedfellows.
“Waste Pickers” Trade Included in Regulatory Scheme
Chile’s landmark circular economy law, the 2016 Framework Law for Waste Management, Extended Producer Responsibility and Promotion of Recycling, is perhaps the first international law which directly tries to incorporate the existing informal waste sector into the regulated market as a recognized, certified trade. The Framework Law contains a stepped certification and licencing process for waste pickers which:
- provides the necessary education program to allow waste contractors to learn the requirements for managing waste under the applicable regulations;
- certifies successful program participants as waste contractors (with a 5-year certification window for current waste pickers);
- requires registration of all interested waste contractors under the EPR scheme;
- permits registered waste contractors to participate in public education campaigns with municipalities regarding consumer participation;
- authorizes these waste contractors to directly enter into waste collection contracts with municipalities and producer responsibility organizations; and
- mandates that waste pickers fulfil all of the health and safety administrative requirements owed by any other contractor under EPR.
In other words, make waste pickers an arms-length, but integral part of the reverse supply chain through a formal certification and authorization process instead of trying to supplant them with corporate waste management collection and hauling companies.
But Will the Waste Pickers Get the Contracts?
Maybe the most obvious question is – will the private sector have sufficient comfort to contract with individuals or entities of previously informal waste pickers for the purposes of obtaining end-of-life products and other materials? The evidence from the program’s inception seems to be encouraging. International food and drink companies, as well as waste industries giants, have already committed to funding elements of the program, signaling the embrace of Corporate Americas with this initiative.
Under the Framework Law, end-of-life products could be collected by the municipalities (under specific agreements with PROs) and not necessarily by producers themselves. Certified waste pickers enjoy an exclusive right under this process to reach direct agreements with municipalities to provide collection and sorting services without having to compete in a formal bidding process with waste industries companies. This preference might give waste pickers needed legitimacy to remain a central part of Chile’s EPR.
Regional Model as Bulwark against Globalized Practice?
Finally, the informal waste sector in many countries has remained deeply dispersed due to the local, low cost nature of the activities and the absence of any imperatives to coalesce around conglomerations.
As producers will increasingly be compelled to participate in reverse supply chains for their products, calls for international service alliances will be inevitable. For Chile’s inclusive scheme to survive in the long run, it will likely need adoption on a regional level and there are certainly signs elsewhere in Latin America that social aims, such as formalizing waste pickers’ role in resource recovery, has the political support to make these requirements accepted practice.
Chile’s bold step to include the informal waste sector in its nascent circular economy is to be applauded. Certified waste pickers, as contracted by municipalities, will have the opportunity to formalize and legitimize their role in the circular economy, thereby giving the scheme needed grassroots support for its long-term success.
For further information, please contact Jonathan Cocker or Rodrigo Leiva Neumann:
+56 9 72143053