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Plastics sector: Reshaping the material's economy

by Arabian Oil & Gas Staff on Apr 9, 2017

Dr Abdulwahab Al-Sadoun, secretary general, Gulf Petrochemicals and Chemicals Association (GPCA).
Dr Abdulwahab Al-Sadoun, secretary general, Gulf Petrochemicals and Chemicals Association (GPCA).

With a production capacity of 27.1 million tons of resins per annum, the plastic industry in the GCC grew by 11 percent annually over the past decade, returning to its historic average growth rate of five percent year-on-year in 2016.

Demand for plastics in the GCC is driven by growth in end-use markets, such as packaging, healthcare, automotive, infrastructure, transport rails and telecommunications, mainly in the emerging economies. Thanks to their lightweight, durability, low production cost and the design flexibility they offer brand owners, plastics are continuously substituting metals, glass, paper and other traditional materials in various applications. These and other important qualities of plastics are allowing for significant contributions to energy conservation in strategic sectors such as packaging, building, construction, automotive and renewables.

The responsible use, recycling and disposal of plastics can significantly improve this region’s competitiveness, while contributing to a greater resource efficiency. A recent report by McKinsey, the Ellen MacArthur Foundation and the World Economic Forum – The new plastics economy: Rethinking the future of plastics – finds that applying circular economy principles to global plastic packaging flows could reshape the material’s economy. In particular, it could drastically reduce negative externalities – valued conservatively by the United Nations Environment Program at US$40 billion – such as ‘leakage’ into oceans as plastics escape established waste collection systems.

Plastics are too valuable a resource to send to landfill at their end of life. Therefore, we need to ensure they are being reused and recycled, whenever possible. Currently, the economics of waste collection, sorting and recycling do not make financial sense in the GCC as the cost incurred can be significant due to labour intensity, transportation and other factors. With economics and regulations playing a crucial role in driving recycling practice, regional stakeholders and governmental bodies will need to work together to foster a well-regulated, sustainable and economically viable waste management practice.

We are already seeing this happen in Sharjah, UAE, where the environmental and waste management company – Bee’ah – is helping meet the Emirate’s ‘2020 zero waste’ target in line with the vision of HH Sheikh Dr Sultan Bin Mohammed Al Qassimi, member of the supreme council of the UAE and ruler of Sharjah. The company aims to turn all the waste collected through its recycling facilities into reusable material and put it back into the economy.

Applying the principles of circular economy, which focuses on building economic, natural and social capital, can act as an important enabler in reaching the strategic national visions of governments across the region. The GCC plastic sector alone, which is projected to grow at a CAGR of three percent between 2016 and 2022, will offer significant opportunities in this field. As environmental and economic challenges become more pronounced, now is the time to act and lay the foundations for a more sustainable, value-added and diversified economy.


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