IF IT AIN’T BROKE DON’T FIX ITAnne Scheinberg, WASTE, <ascheinberg@waste.nl>

Zero Waste meets the Global Informal Recycling Sector

This presentation is a work-in-process. Citations are permitted and should state this.

Thanks to Reka Soos, Michael Simpson, and Bharati Chaturvedi for suggestions in this version, and to Sandra Cointreau at the World Bank for posting an

earlier version on their website. Thanks also to GTZ and the German Ministry of Foreign

Affairs, BMZ, for funding the study: “Economic Aspects of the Informal Sector In Solid Waste” in 2006-2007.

Additional suggestions are actively invited, please send them to <ascheinberg@antenna.nl>.

Welcome!

1. A short personal introduction2. Organisation of this presentation

a. Informal recovery and recyclingb. “Economic aspects of the the global

informal sector in solid waste”*c. Zero Waste and the Informal

Sector: Insurmountable opportunity?

3. Resources4. Questions and discussion

Part 1. Informal recovery -- a part of urban life for centuries

supports women, men an children:• in rural areas as gleaning, • in urban areas in the form of informal

recycling, referred to as rag picking or waste picking or scavenging.

• a source of livelihood to groups with limited access to the formal labour market

• few barriers to entry for: • attracts internal or international migrants,

specific ethnic or social groups, low castes, landless peasants

Those who could survive the working conditions, could earn a reasonable living for their

families and benefit their cities.Info drawn from GTZ/CWG 2007, ILO 2004, and Scheinberg, Mitrovic and Post 2007

Waste picking represents:

1. the foundation of most -- if not all -- recycling activity prior to the modernisation process

2. the bottom layer of activity in the so-called secondary materials pyramid, also called the “recycling supply chain”

3. a global phenomenon with predictable characteristics

4. a rational -- even strategic -- choice of livelihood for disadvantaged groups -- internal migrants, ethnic or religious minorities, women heads of household, illiterate or uneducated persons

5. maybe the most misunderstood global phenomenon

Informals are private entrepreneurs

1. Members of the informal sector in solid waste and recycling are private sector entrepreneurs.

2. Informal recycling offers a livelihood and income which they could not otherwise manage to achieve.

3. The informal sector – in contrast with municipal cleansing companies or recycling programmes – only engages in “profitable” activities.

Commodities- or service-based economic activities.

1. Commodities-based activities a. focus on finding, possessing, upgrading, and trading

(or in some cases using) materials and items. b. are paid for according to the weight, volume, or

number of units of what is recovered, traded, used.

2. Service-based activities a. focus on doing something which someone or some

institution values. b. (almost) always involve some kind of removal –dirt,

contaminants, excreta, waste, water, etc. c. are paid based on a time measure of labour, in the

informal sector often but not always days --d. or other service units, like metres of curb cleaned or

number of households served.

Part 2. “Economic aspects of the the global informal sector in solid waste”*

The study was based on research done by an international team, including six city partners, who looked in detail at:

1. six cities in varying states of modernisation, with populations ranging from 380.000 to 17 million

2. the movement of materials through formal and informal solid waste and recycling processes

3. efficiency and effectiveness of formal and informal recycling and organics recovery

4. the operational, social, economic, and environmental impacts of informal activities

5. relationships between formal and informal solid waste activities in six cities

* The GTZ/CWG Study 2007,

Six study cities, six local partners with informal sector contacts / waste focus

1. Cairo, Egypt -- CID2. Cluj-Napoca, Romania -- Green

Partners3. Lima, Peru -- IPES4. Lusaka, Zambia -- Riverine Associates5. Pune, India -- KKPKP (Union of waste

pickers)6. Quezon City (part of Metro Manila), the

Philippines -- SWAPP (solid waste association)

Process Flow of Cluj, Romania

Six Study Cities, pop 32 million, have 75,000 informals

City Population People in the Informal Sector

Cairo, Egypt 17,620,580 40.000

Cluj, Romania 380,000 3.200

Lima, Peru 7,765,181 11.200

Lusaka, Zambia 1,238,227 390

Pune, India 3,000,000 9.500

Quezon City, Philippines

2,247,098 10.100

Dump pickers, Vietnam

Solid waste in the citiesCity tpy residential

tpytons to formal

percent recycled

tons to informal

percent recycled

Cairo 3,454,996

2,865,378 810,667 45% 2,567,142 84%

Cluj 194,458 163,085 145,779 6% 14,575 100%

Lima 2,725,424

1,956,228 1,839,711 0.5% 848,364 62%

Lusaka 301,840 245,996 90,720 13% 98,170 6%

Pune 544,215 369,745 394,200 0% 132,130 89%

Quezon City,

623,380 380,261 489,606 3% 141,831 100%

Informal sector in the six cities

City Tonnes recycled/yr

People in the Informal Sector

Cairo, Egypt 2.162.500 40.000

Cluj, Romania 14.700 3.200

Lima, Peru 529.400 11.200

Lusaka, Zambia 5.400 390

Pune, India 117.900 9.500

Quezon City, Philippines

141.800 10.100

Informal Sector occupations

IWBs (IWCs in SEE, CRs in India)Street and container pickersTruck and collection crew pickersDump pickersMobile tradersSmall junk shopsMedium junk shopsSwine feeding operations

Itinerant waste buyer, Pakistan

Recycling in the Formal Sector

Collection crewsMedium and large junk shopsIntermediate processorsBrokersMRFs and IPCsEnd-users and millsComposting facilities

Distribution of main occupations by %

City Dump pickers

Street pickers

IWBs Informal collectors/ ISPs/truck pickers

Cairo, Egypt <1% <1% <1% 71%

Cluj, Romania

27% 73% - -

Lima, Peru 6% 57% 16% 1%

Lusaka, Zambia

47% 31% - **

Pune, India 3% 26% 17% 11%

Quezon City, Philippines

26% 37% ** 18%

Informal sector and recycling industry

City Tonnes recycled/

yr

Informal sector €/day

as % of min wage

annual sales to recycling industry*

Cairo, Egypt 2.162.500

€4.30 (no min wage)

€26,337,000

Cluj, Romania 14.700 €6.28 140% €2,462,000

Lima, Peru 529.400 €5.40 110% €55,678,000

Lusaka, Zambia

5.400 €6.52 280% €471,000

Pune, India 117.900 €2.80 240% €15,381,000

Quezon City, Philippines

141.800 €6.26 90% €7,077,000

* includes all activity in the supply chain per city

Scrap metal market, Eritrea

The Recycling Supply Chain-theory

Householdsseparation

Dumpsitewaste picking

Businesses/Institutionsseparation

Street pickerswaste picking

Itinerant waste buyers (IWBs) collection

Small junkshopsseparation/temporary

storage

Larger junk shops/processorssorting/cleaning/compacting

Recycling IndustryDomestic

Recycling IndustryExport

An

d P

racti

ce

Small junk shop metalSmall junk shop metal

Small junk shop glass-plasticSmall junk shop glass-plastic

Mixed junk shop at dump

Mixed junk shop at dump

IWBs, street pickers, dump pickers, waste crews

Plastic sheet

molder

Plastic sheet

molderGlass cullet

processor

Glass cullet

processor

Small junk shop paperSmall junk shop paper

Generators: Households, businesses, dumpsites, transfer stationsGenerators: Households, businesses, dumpsites, transfer stations

Small junk shop mixedSmall junk shop mixed

large paper high-grader, broker,

exporter

large paper high-grader, broker,

exporter

broker non-

ferrous metals

broker non-

ferrous metals

dealer (all materials)

dealer (all materials)

plastics regrinderplastics

regrinder

Specialised bottle

washer

Specialised bottle

washer

End-user boxboard

mill

End-user boxboard

mill

end-user re-alloy

can sheet

end-user re-alloy

can sheet

intermediate processor

commingled

intermediate processor

commingled

large junk shop all metals

large junk shop all metals

end userglass mill, fiberglass

end userglass mill, fiberglass

end-user tissue and towel mill

end-user tissue and towel mill

end-user electric-arc

furnace

end-user electric-arc

furnace

End-user industriesEnd-user industries

Small junk shop otherSmall junk shop other

Main conclusions - 1*

1. Most recycling in the developing/transitional world is initiated by tiny private businesses in the informal sector, also true until the 1970s and 1980s in most OECD countries.

2. These tiny businesss are risk-loving, highly entrepreneurial, and impenetrable to those outside the sector.

2. The global informal sector recycles millions of tons, putting materials into the recycling supply chain and supporting billions of people.

3. Informal sector workers often earn at least twice the legal minimum wage in their countries, but this may be the product of the work of more than one family member.

* ILO 2004, GTZ/CWG study (2007) & IFC Serbia (2007)

City of Diadema, Brazil contracts the informal sector to collect recyclables

Brazilian President Lula shows his support to the informal sector and encourages decision makers to recognise their value and use their professional expertise (2005)

Main conclusions - 2*

4. There are many connections between the formal and informal recycling sector in all countries: informal sector workers accompany trucks, work at dumpsites, or empty containers. Formal sector workers “moonlight” selling recyclables or working for private (informal) collectors and recyclers.

5. Formal and informal sector are often ‘natural partners’, as materials pass back and forth between these sectors in the recycling chain.: formal workers sell materials to informal junk shops, informal sector workers get their materials from formal disposal facilities.

6. Socio-cultural biases often interfere with the efficiency of this economic partnership. This tendency is exacerbated when there arer differences of religion, ethnicity, or when the informal sector consists of migrants.

* ILO 2004, GTZ/CWG study (2007) & IFC Serbia (2007)

Main conclusions - 3*

7. Without the informal sector, recycling is a much more difficult and expensive business.

8. Informal recycling activities, are efficient and low-cost -- and intensify during the economic crisis.

9. Formal recycling initiatives have a tendency to be over-capitalised and to recover very small quantities

10. In contrast, informal recycling is under-capitalised and recovers very large volumes.

11. It is therefore critical for you-- the Zero Waste Dialogue, to promote and engage with the private recycling sector -- both informal and formal -- rather than only supporting new, unfair, inefficient parallel “new” recycling initiatives

* ILO 2004, GTZ/CWG study (2007) & IFC Serbia (2007)

Part 3. Zero Waste and the Informal Sector: Insurmountable opportunity?

1. find networks or intermediary organisations and institutions working with informal sector leaderc

2. work with these intermediaries to engage the informal sector in a consultative, participatory process as part of the baseline assessment or situation analysis

3. engage with the capacities and professional identity of the informal sector, rather than their social problems

4. focus “help and support” on strengthening capacities of informal stakeholders to analyse their own operations

Muncipality supports informal collectors of recyclables in Lima, Peru

Working with the Informal Sector-2

5. Always engage waste pickers and informals as part of campaigns, stakeholder processes, EIAs

6. Critically evaluate your and your city’s approach to recycling as presented in consulting documents, investment plans, and/or municipal solid waste plans. Insist recycling plans should include and integrate the informal sector, rather than disenfranchising them and creating parallel systems

7. Encourage the development and testing of specific and practical strategies for supporting and encouraging local authorities and their agents to protect materials access and create new service opportunities for informals

8. Document experiments and evaluate their reasonableness, feasibility, sustainability, and cost-effectiveness

9. Analyse informal recovery and include the materials handled in all discussions and calculations on the way to Zero Waste

Pune Municipality offers medical insurance to waste pickers

“A city agrees to pay medical bills of those who clean it up: Pune, India offers medical insurance to its informal ragpickers”

Part 4. Some resources

The Collaborative Working Group on Solid Waste Management in low- and middle-income countries:

www.cwgnet.net (and the informal sector network)

WASTE, Advisers on Urban Environmentwww.waste.nl -- and coming soon, a new portal

Chintan-Environmental, Delhi, Indiawww.chintan-india.org

“If it ain’t broke, don’t fix it” -- an explanation.

Thank-you. Questions are welcome!

<ascheinberg@waste.nl>