May 29, 2023
JAKARTA – At 6:15 am the first rays of the magical Bali light are breaking over the horizon. At the shoreline, hotel staff are finishing their daily routine of raking piles of plastic bags, cups, wrappers, and other trash that washed up overnight.
By 3 pm, plastic will be building up again on the sand. A reality in Bali and other island destinations mostly kept hidden from visitors. Every day, the Bali paradise is carefully cleaned and manicured to maintain its status as the world’s top tourist destination. After all, monetizing beautiful environments is the business model of resorts and hotels in sought-after destinations the world over.
As day breaks on the other side of the world in Paris, the International Negotiating Committee is this week working to agree on the scope and details of a global treaty on plastic pollution. Success in this process over the next 18 months will spark new urgency for countries to solve the problem of plastic waste, beyond temporary cosmetic fixes.
In Bali, this presents a substantial private sector opportunity.
Each year an almost unfathomable 300,000 tonnes of plastic waste are generated in Bali, more than 50 percent openly burned or dumped. As a result, 33,000 tonnes of plastic waste – equivalent in weight to 2,609 double-decker buses – are annually leaked into the island’s waterways and the ocean.
Tourism contributes some 70 percent of Bali’s economy, and tourists themselves produce 3.5 times more plastic waste per capita than locals. One wonders if the very act of shielding visitors from the extent of the island’s plastic pollution only magnifies the problem by enabling them to consume in blissful ignorance.
More significantly, Bali’s tourism-dominated economy has caused a shift in local lifestyles around the use of plastic. From the rise of convenience stores with shelves of plastic products to the replacement of the traditional banana leaf with the plastic bag, Bali has embraced a version of modernity synonymous with waste.
Educational and behavioral change initiatives around proper waste management have been insufficient. The pervasive mixing of plastic and organic waste, the latter being 70 percent of the total, is a crucial blocker to greater plastic circularity which would unlock its value and keep it out of the environment.
Given its outsized role in the economy, the tourism industry must play an active role in the solution. Total plastic consumption must be reduced. Single-use, discretionary, and difficult-to-recycle plastics should be eliminated. Manufacturers need to retool products to be reusable, recyclable or even shift fundamentally to less material-intensive business models. Then only, a circular economy can deliver on its promise of local economic benefit, reduced pollution, improved health and productivity, and carbon emission reduction associated with lower virgin plastic production.
At present plastic circularity in Bali is still a dream. Attempts to mandate that fast-moving consumer goods (FMCG) brands lead the transformation through Extended Producer Responsibility (EPR) schemes have failed. Despite a growing trade in used rPET bottles, mostly informal and in undesirable conditions, the mountains of waste continue to grow, in Bali and across Indonesia’s vast and beautiful archipelago.
Brand commitments to integrate recycled plastic into products cannot be met due to a marketplace shortage of quality material. The real value of secondary plastic has yet to be unleashed through simple collection and sorting, despite growing demand from companies. Instead, the materials they want are languishing in mixed waste dumps despoiling nature, Bali’s greatest asset.
In response, the Clean Bali Fund has been proposed as a private sector-led initiative designed to radically upend the dirty status quo by providing essential capital expenditure for cooperative-run sorting facilities and a subsidy for village waste separation. Developed by a team of international business executives and public sector leaders, facilitated by our team, it presents an innovative model to incentivize waste separation at source, reduce leakage to the environment and tap into the significant market demand for recyclable plastics. It is the result of an intensive business design process with local stakeholders with a shared vision to end Bali’s plastic waste crisis.
Through waste separation, three circular product streams can be produced in Bali: organic compost from household food, ceremonial and garden waste, high-value recycled plastic including PET, HDPE and polypropylene, and low-value recycled plastic from bags, films, and sachets. Residual un-recyclable waste must still be managed through sanitary landfilling, given modern incineration’s absence.
Compost, a practical and valuable product for any verdant community, has been undervalued, selling in the open market for less than 10 US cents/kilogram. With a social impact subsidy, this most fundamental of circular products can be produced by villagers and sold at a profit to hotels, landscapers, nurseries, and farms.
Those high-value secondary plastics can be sorted, pressed into bales, ground into flakes, and sold to recycling companies in Java or on the international market. Low-value plastic material is destined for pyrolysis, also known as chemical recycling which each year is dropping in price, or in some cases downcycled into construction materials. Resorts keen to promote their green virtues can install recycled plastic bricks, outdoor flooring, or garden fixtures. The key is properly pricing downstream products and compensating villagers for their essential services.
Plastic waste is not unique to Bali. But Bali can lead the way to inspire new approaches to plastic waste management. Phuket saw a 45 percent increase of plastic waste in a year. The Philippines reportedly contributes up to one-third of global oceanic plastic waste, though it is mostly manufactured elsewhere.
A private sector, policy-driven intervention that leverages the wealth of the tourist economy can be a bold solution to an apparently intractable problem. Tourists come for natural beauty. Tourism operators cannot survive if it is despoiled.
Experts and veterans of the packaging and recycling industries consulted in the creation of the Clean Bali Fund admit that the market, on its own has failed, and new ideas are sorely needed. Ensuring Bali remains clean, beautiful, and a magical destination for visitors is neither a job for hotels nor their staff endlessly sweeping the beaches.
If done smartly, the wider tourism industry can be an enabler of a society-wide structural and behavioral shift toward a more circular material economy.
The writer is managing director of the Global Institute For Tomorrow (GIFT), an independent, pan-Asian think tank with offices in Hong Kong and Kuala Lumpur.