Waste Management: Steps to Flourishing Recycling Business
Updated 10/24/2023 7:51:00 AM
Recycling and solid waste management are among the important aspects of waste management that can have economic benefits for Egypt. The lack of proper waste management poses serious health and environmental problems for the country and its population. However, with government support and the development of waste management infrastructure, the country can reap the economic benefits of waste management.
Waste Management Development
Egypt ranked first in the Arab world with a score of 26.6 and 42nd globally out of 180 countries in the Environmental Performance Index regarding recycling in 2022, as it witnessed an improvement over the previous 10 years, as mentioned by the cabinet's Information and Decision Support Center (IDSC) report 'Recycling.... road to sustainable environmental development'.
The report further explained that Egypt has 28 recycling factories, and is working to increase this number to 56 factories, as more than half of Cairo’s waste is collected by the informal sector, which consists of 50,000 waste processors and 150,000 waste collectors, sorters, merchants, and truck drivers.
This comes as Egypt has been working on developing the waste management and recycling sector through several steps. In October 2020, the new Waste Law No. 202 of 2020 was issued, which is distinguished by the Waste Management Regulatory Authority (WMRA) which is a unified body responsible for the waste management process, under the Egyptian Ministry of Environment. The new law allows the private sector to participate in the process, provided that data on the quantities and types of municipal waste is determined and updated and an accurate database is prepared for it.
Nirmeen El Sayyad, UN Women Project Manager at the American University in Cairo (AUC) and an economic expert, tells Arab Finance: "The new law aims at stimulating growth in the waste-management business sector. In this regard, any company whose primary object is waste management will benefit from the same investment incentives and guarantees provided under the Investment Law No. 72 of 2017, and any expenses borne by waste management companies will be deemed tax-deductible expenses in accordance with the Income Tax Law No. 91 of 2005.”
Having this law implemented will attract domestic and foreign investors to the waste management sector, El Sayyad continues.
The waste management and recycling sector still needs development to attract investments and have a tangible contribution to the Egyptian economy. Shady Shehada, an international trade and economics expert, tells Arab Finance that it needs “good and appropriate planning for land use and development and monitoring construction plans for residential, industrial, commercial, and recreational uses. Providing the necessary funding to entities that recycle waste.”
The sector further needs to establish a dedicated infrastructure for treating waste, especially plastic waste, spreading awareness and education programs for the masses, and providing incentives to establish waste collection areas near recycling areas to reduce transportation costs and facilitate delivery to treatment areas, according to Shehada.
Waste Management Economics: Challenges and Benefits
Solid waste management in Egypt faces several challenges due to "governance and integration among stakeholders," as mentioned by Dr. Hisham Sherif in the article entitled 'Waste Management in Egypt – An Overview' published in 2021 by Waste and Recycling Middle East Magazine. The challenges are mainly related to a lack of incentives for the private sector, as well as structural issues related to the unconducive recycling market and the collection infrastructure.
Yet, solid waste management and recycling offer promising investment opportunities. El Sayyad explains that over 95 million tons of solid waste have been generated from various sectors in Egypt. Per capita waste generation ranges from 0.2 to 0.6 kilograms, which varies depending on the household and the economic size of the population.
Moreover, recycling provides jobs, which contributes to solving unemployment in Egypt. Moreover, solid waste management enables the establishment of different factories in Egypt. El Sayyad says: “Investing in recycling and waste management has several positive impacts on several domains, including but not limited to conserving natural resources, energy savings, reducing carbon emissions, as well as a cheaper way of recycling waste than traditional measures. On another note, this will also contribute to reducing unemployment rates and increasing income generation levels for beneficiaries. Whereby resulting in a cleaner city with lower poverty rates and higher income generation.”
Egypt does not only have an opportunity in solid waste, such as paper, wood, metals, plastics, and glass, but it also has a huge amount of agricultural waste that bears a great economic benefit. Egyptian entrepreneur Atallah Gad Al-Karim told Al Ahram Newspaper in September that “Egypt’s agricultural activity results in 15 million tons of agricultural waste per year. This could be turned into organic fertilizer and be used in reclaimed desert areas.”
Moreover, when it comes to edible oil waste, it is expected to reach an $11 billion global market by 2028, according to Fortune Business Intelligence Group. “There are currently 26 companies operating in used edible oil in Egypt, either for export, to produce biodiesel, or to make soap,” Ibrahim Farouk, CEO of local biofuel consultancy Bio-Rotterdam, told Enterprise in August.
Recycling waste supports the circular economy, which uses waste as a resource for manufacturing. Shehada explains that “the transition from a linear economy to a circular economy will increase economic growth by reducing the annual cost of burning to dispose of waste. This will contribute to increasing profits and thus boosting wages and salaries for workers in the field of recycling. It will also help achieve stability in the prices of materials and final products, which will support creating demand for new services in various fields such as logistics services, marketing, and remanufacturing.”
Accordingly, as the country faces challenges and provides enough incentives to investors, the waste management and recycling businesses in Egypt can bear fruit and support economic growth. Offering job opportunities and providing cheaper and more environmentally friendly ways of production, recycling can be a very promising sector.
By Sarah Samir
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