INTERNATIONAL GREEN DEAL: PARTNERS IN RETHINKING SINGLE USE PACKAGING – concept note

Shared by Dutch Ministry of Infrastructure & The Environment

INTERNATIONAL GREEN DEAL: PARTNERS IN RETHINKING SINGLE USE PACKAGING
concept note

Wouldn’t it be great if we could bring together a wide range of knowledge, expertise and creativity to find new solutions in the use of materials, packaging, products and in services to mitigate the environmental effects and waste creation of single use packaging?

The International Green Deal on reducing single-use plastic packaging products aspires to explore and develop new market and governance approaches with the goal to (commercially) attend to the needs of low- income market segments while at the same time drastically limiting the associated environmental damage of single-use plastic packaging, its contribution to litter, marine debris, greenhouse gases and the costs of waste processing and clean-up.

With the adoption of the 2030 agenda for sustainable development in September 2015, heads of State and Government have pledged commitment and action to address the multifaceted and intertwined challenges of ensuring environmental sustainability, eradicating extreme poverty, and achieving economic and social wellbeing. Among the 17 Sustainable Development Goals merely a few include: tackling inequality, taking action to combat climate change, conserving and sustainably using the oceans, seas and marine resources and ensuring sustainable consumption and production patterns. The 2030 agenda thus not only represent a transformational agenda for inclusive and green growth but a globally shared responsibility.

In view of the 2030 ambitions towards sustainable development, this International Green Deal on rethinking single use packaging warmly invites stakeholders in Indonesia and the Netherlands to come together to explore opportunities to rethink and redesign products and services related to single-use servings in a sustainable manner and ensure their accessibility and affordability. This concept note aims to investigate the interest of stakeholders in the Netherlands and in Indonesia to join forces in this cross-sector exploration.

Background information

Today, one in five people in developing regions still live on less than $1.25 a day, and there are millions more making merely a little more than this amount daily. In many developing and emerging countries the FMCG

industry1 is striving to serve and address the needs of these low income market segments with smaller sized product servings also known as single use or mono packaging units. The small size makes products more affordable allowing people, whom would otherwise not have the financial capacity to purchase a product, to “buy less, more often” and providing them with greater market access.

The targeted market segment, known as ‘the bottom of the pyramid’, is by far the largest in Asia, representing 83% of the region’s population and 42% of its aggregate purchasing power, a significant part of the rapidly growing consumer market2. For FMCG producers their small-sized product assortment currently represents a significant part of their total market share and unit sales in these markets. As a result, over the past decade single-use servings are recognized as an effective inclusive business model for industry to reach and address the needs of low income segments in developing and emerging markets, and thus a win-win solution.

These packages mainly consist of flexible plastic sachet, pouches, beverage containers and plastic bottles. For the most part single-use packaging consists of plastic materials and unrecyclable multi-layered material. As plastic recycling rates are still only 14%3 and single-use packaging units generally use more material for a specific amount of product than traditional multi-use units do, the amount of resources and greenhouse gas emissions involved in the production and processing of such products is much larger. Furthermore in many markets where single- use products have a large market share, the infrastructure for proper and robust waste management is still underdeveloped. The fragility of these markets to leak waste into the natural and marine environment is significant. Given their sheer size and weight, single-use packaging is prone to littering and is often found to be the cause for clogged waterways leading to increased flooding in rainy seasons and increased costs for municipal clean-up programs. Recent research has shown that the largest contributions to marine litter come from heavily populated coastal countries with poor waste management practices4. In emerging markets it

  1. 1  FMCG: Fast Moving Consumer Goods
  2. 2  Allen Hammond et al, The Next 4 Billion: Market size and business strategy at the base of the pyramid,

International Financing Cooperation and World Resources Institute, 2007
3 World Economic Forum, Ellen MacArthur Foundation and McKinsey & Company, “The new plastics economy – Rethinking the future of plastics”, 2016
4 Jenna R. Jambeck et al, Plastic waste inputs from land into the ocean, 2015

is often found that main sources of marine litter found in coastal areas consist of single-use packaging, including beverage containers.

Low recycling rates and a high degree of littering of plastics lead to greater pressure on the (marine) environment, landfill and incineration and on their associated costs for local governments. It is evident that the current market approach of single-use products involves great environmental externalities. Although the continued growth expected in the supply and demand of single-use products may create increased benefits for more and more people, if this trend continues to develop in the current manner costs will continue to rise and environmental consequences will rapidly increase.

Joining forces: an International Green Deal
To turn around the current process of continued environmental degradation smart solutions are needed that address the so-called “bottom of the pyramid”, particularly in developing and emerging countries in a more sustainable and holistic approach. How can the environmental effects of single use servings be mitigated while ensuring the accessibility and affordability of products for low-income market segments?

Indonesia could be a leading nation in turning this trend around and in setting the tone for other markets in South East Asia, Africa and Latin America. At the same time, more and more developed countries are confronted with an increasingly fast-paced society and similar problems on how to reduce waste and littering, how to redesign products and their packaging towards enhanced functionality, resource efficiency and longer- life time. For the Netherlands these challenges are a priority. The Netherlands and Indonesia are therefor initiating a movement to address this matter in cooperation with other non-state actors, the private sector and civil society organisations.

The International Green Deal on rethinking single use servings aspires to explore and develop new market and governance approaches of how to (commercially) attend to the needs of low-income market segments, while drastically limiting the associated environmental impact of single-use servings, its contribution to marine debris and greenhouse gases and the costs of waste processing and clean-up. Through a shared vision and common effort of a wide variety of stakeholders including industry players throughout the supply chain, universities, knowledge institutions, relevant civil society organizations and governments the International Green Deal

aims to share, mobilize and channel knowledge, expertise, technology and financial resources to fulfill this endeavor and to cooperate in taking concrete steps to make the most of potential win-wins.

Through this voluntary initiative participants embark upon a movement that aims to create concrete and viable alternatives through the design and use of materials, packaging, products and services. Although the tangible impact of this joint effort is yet to be determined, by bringing together their knowledge, creativity and expertise, perspectives can be developed with a solid scientific and commercial foundation, that allow industry and governments to contribute to the recently adopted climate and sustainable development goals. By joining forces in developing smart and sustainable solutions, business model approaches and market perspectives this initiative will lead the way to address this widely understated and multifaceted issue of sustainably reaching low-income market segments.

Format to be further developed

  • –  Joint statement of commitment
  • –  Voluntary and concrete contributions
  • –  A common action agenda with avenues for exploration, cooperation,

    research and development

  • –  Predefined timeline and point of evaluation
  • –  Continued opportunity of additional signatories and contributions

    Possible avenues for further exploration

  • –  Research and knowledge exchange regarding consumer behavior and psychology
  • –  Eco-design for products and packaging
  • –  New business model development
  • –  Minimizing the amount of resources and materials needed and

    increasing the use of recycled content

  • –  Life-time extension and reusability
  • –  Reverse supply chain logistics and retail solutions (dispensers etc.)
  • –  Recycling and innovations for mutli-layered and flexible packaging
  • –  Biobased materials
  • –  Materials that enable more and higher value recycling
  • –  Micro-financing and digitalization

    Further steps and foreseen timeline:

– 22 November 2016: launching session and signing ceremony

By signing participants will commit to contributing to a shared investigation of possibilities of circular design of products and services in order to mitigate the environmental effects of single use products.

  • –  January 2017: Adoption of a common action agenda with priority avenues

    Including concrete contributions (activities) of partners and a timeline

    for evaluation and next steps.

  • –  May 2017: Conference by Indonesian Ministry of Maritime Affairs stock-taking session and next steps.
  • –  Sept. 2017: Evaluation of the preliminary results and possibilities for follow-up