THE ROLE OF FORMAL AND INFORMAL SECTORS IN SOLID WASTE MANAGE- MENT OF DEVELOPING COUNTRIES SUCHADA P.*, J. TRÄNKLER*, CHOLADA K. AND W. SCHÖLL *Asian Institute of Technology, Klong Luang, Pathumthani 12120, Thailand Solid Waste Management Programme, Phitsanulok 65000, Thailand SUMMARY: Whilst in industrialized countries reasonable means are spent on refuse recycling and reclamation, this is practiced to a very efficient degree in the developing world. The formal and informal sectors play a major part in the recycling system of these countries. The complex recycling system of the formal (registered as tax payers) and informal sector of Phitsanulok, a city of 120,000 inhabitants in Thailand s Central Plains, has been surveyed to assess its efficiency especially concerning the relief of the local landfill. The joint recycling activities account for 38% of the entire waste generation; therefore, the activities play an important role in the expansion of landfill lifetime. The quantities of recyclables collected and sold by the formal and informal sectors and other contributors sum-up to 19,200 tons/year. Sanitary landfill scavengers are of minor importance reducing the wastes before dumping around 0.6 %... The recycling activities comprise a comprehensive approach at great level of detail. Main fractions by weight are paper 36%, glass bottles 26%, and plastic container 9% and by value aluminum cans (3% weight). 1. RECYCLING AND PUBLIC PARTICIPATION IN DEVELOPING COUNTRIES Waste recycling and resource recovery is the effective way to reduce the need for landfill areas and to save natural resources. Furthermore, it should be the first step in a sound waste management as being recommended by Agenda 21. Consequently, the formal and informal sectors participation is involved in the MSWM System, especially, in the recycling activities. The formal and informal sectors could provide advantages in the terms of cost, control, and reliability. However, these sectors only response of the execution in some of the tasks, but the municipality retains the final responsibilities to ensure the performance of tasks and to control them. The formal sectors consist of enterprises, which enjoy official recognition, protection, and support because they are registered or have given a license by the local government or municipality. The informal sector is the sector that operates in unregistered, unregulated or casual activities, including individual and family enterprises. Poerbo (1996) stated that in the informal sector approach, urban waste is viewed as an economic resource, which reveals multiple results like reduction of waste, saving in public expenditures for waste management, and employment generation. Proceedings Sardinia 2003, Ninth International Waste Management and Landfill Symposium S. Margherita di Pula, Cagliari, Italy; 6-10 October 2003 2003 by CISA, Environmental Sanitary Engineering Centre, Italy
Besides the large-scale private sector which is mostly involved in wholesaling or reprocessing of waste materials into intermediate materials or products), many small-scale entrepreneurs are active in recycling. The significance of the informal sector in SWM is self-developed by incomeearning motivation. Its performance is not stable under market-driven mechanism (Amin, 2000). Table 1. Role of the informal sector in SWM. Category Method of Work Material Street pickers Recovery Bottles, cans Landfill scavengers Recovery Bottles, paper, plastic bags, cans, other valuables Collection crews Recovery (en route) Bottles, cardboard, cans, valuables Itinerant buyers Door to door buying (announced collector) Paper, cardboard, plastic bottles, glass bottles, aluminum cans Dealers, neighborhood dealers or Buying (retail) buyers Small-scale entrepreneurs Buying, trading Large-scale entrepreneurs Buying and large-scale processing technology Modified and supplemented on the basis of Romaos and Chifos, 1996 Metal, iron, steel, paper, cardboard, plastic bottles, glass bottles, miscellaneous 1.1 Public Participation and Waste Recycling/Recovery Community role in SWM has traditionally been as a recipient of waste disposal service. It is now moving more in a direction of active participant in waste reduction, source separation and composting (e.g. backyard composting). The community is currently not only a service receiver or customer, but also becoming a service provider through participation in various levels and aspects of SWM and is getting increasingly involved in waste collection and street sweeping with respective neighborhood boundaries. It provides human resource and innovative ideas, and improves efficiency in SWM in terms of accountability and cost-benefit. (Amin, 2000) Public participation can, significantly, reduce the cost of collection. (Suwarnarat, 1996).Public concern is necessary to reduce large amount of wastes. 2 GENERAL OUTLINE OF THE SURVEY The municipality of Phitsanulok has been selected for the survey because during recent years recycling activities have been pushed by private enterprises and the municipality. Recycling activities in the municipality of Phitsanulok is rather performed by formal and informal sectors than the public sector. A complex system of large formal enterprises mixed with formal to casual has been established during the last decades and provides a model case for Thailand, too (Chantarakiri R.and Vithal G., 2002). The study covered the entire area under the jurisdiction of the Phitsanulok Municipality plus neighboring areas, influencing the overall recycling activities. The survey done during April to June 2002 and November to December 2002 should cover various aspects and provide reasonable in-depth data additional to official records. Based on the first phase investigations and findings an intensive review of the current collection/generation rates of recyclables has been launched in November and ending middle of December. Objectives of the survey were to record the quantities and composition of recyclables collected by the various participants of Phitsanulok s recycling activities, namely the formal sector and private enterprises; to extrapolate these data in combination with the information gather during the year to an annual collection rate; to identify roles of the participants and future
trend of recycling activities. For a detailed survey all parties involved have been screened. According to the knowledge gained the following leading members both of the formal and the informal sector of the local recycling business could be identified and selected. It was expected that more than 90% of the recyclables are dealt with these participants. Accordingly a reasonable statistical significance shall be achieved as a sound basis for an extrapolation. Given the variety of materials and the peak times of deliveries as well as the documented amount of recyclables arriving at the formal junk shops 2 3 persons performed the data collection. Shop owners of non-registered junk shops have been requested to record the quantities of their recyclables. Quantities of recyclables of landfill scavengers were documented at the weigh-bridge whenever the recyclables are sold during the timeframe of surveying. The personnel at the landfill site performed this data collection. Occasional spot checks guaranteed a reasonable data base. The camps, schools and communities target groups were asked for cooperation documenting their recyclables data themselves. Plausibility checks shall assist in getting reliable information. Regarding the collection crews information about their activities were surveyed by the municipality respectively junk shops have been ordered to record the incoming amount as well composition of recyclables segregated by the crews. Although, reasonable personnel has been deployed to record all variables this survey relied on the contribution and voluntary action of all parties involved. We are aware of discrepancies and inaccuracies for what so ever reason they occurred. Whenever possible we did a crosscheck and tried to achieve best available information. However, we had to recognize that recycling business in Thailand is as seclusive industry as in European countries. Nevertheless, this investigation will provide a differentiate picture of the formal as well as informal sector s activity in the recycling business of Phitsanulok. Especially the amount of materials collected on an annual basis (extrapolation) and the individual contribution of parties involved to the overall waste reduction have been assessed and documented to the extent feasible. 3 STRUCTURE OF THE LOCAL INFORMAL AND FORMAL SECTOR 3.1 Interaction of formal and informal sector The recycling scheme of the formal and informal sector unveils as fairly complex and highly intermeshed system based on relations established over generations. Formal recycling firms as recyclable material traders, which buy materials have been operating as family businesses with long-time experiences. These well-established recycling firms have built an association controlling the business and purchase prices. Sources of recyclables are from community (households and small business shops), then collected by informal sector (collection crews/ tricyclists/ street scavengers/casual pick-up traders) or by the communities themselves. Recyclables are sold to the dealers which are both formal and informal recycling firms, after that sold to the middleman or sold directly from the firms to the manufacturers. However, some kinds of recyclables such as soft drink bottles are returned to the manufacturers directly. To close the loop, products made from recyclable materials are sent back to the consumers. Informal collectors are the tricyclists, street scavengers, pick-up traders, collection crews, and landfill scavengers. The former four parties play a major role in collecting recyclables directly from various sources around the city, whereas at the end of the chain the landfill scavengers search the remainders. There are some specific sources such as the large-scale supermarkets, military area, and the municipal collecting trucks. Recyclable materials from these specific sources has their different destinations, recyclables from the supermarkets and the municipal collecting trucks are sent to
one distinct company, while those from the military area are sent to another firm. Casual buyers or middleman for purchasing directly from major generators are also operating. In the following the major contributors identified have been surveyed in detail in order to obtain a better picture on their specific performance and interaction. Figure1: Interaction and material flow within the municipality. 3.2 Participants and their activities 3.2.1 Formal recycling companies Eleven recycling firms are registered as formal recyclable material traders who buy the materials from individual households, tricyclists, street scavengers, pick-up traders, collection crews, organizations, and the firms themselves. The formal recycling firms have been doing trade individually; except the linkage between one dominating company with 150 workers, several branches within the city boundaries and franchises. Most of the formal recycling firms have been operating in the form of family business with vast experiences over decades. These recycling firms have syndicated. 3.2.2 Informal sector Informal collectors are the tricyclists, street scavengers, pick-up traders, collection crews, and landfill scavengers. For the former four parties, play the role in collecting recyclables directly from various sources around the city. The latter is the last party who sorts the recyclables out of
wastes before dumped in the landfill. The competition among different traders should be kept going since it is the inspiration in recyclables collection from all the involving groups. 3.2.3 Recycling activities of municipal communities Forty-one districts (communities) have been set around the city according to the decentralization and public participation policies of the municipality. Community development programmes have been launched as part of the Municipal Solid Waste Management Program. Separated by the solid waste recovery activities, there are four groups of communities: eleven recycling only communities, four composting only communities, fourteen recycling and composting communities, and eleven of none recovery activities at all. The municipality office supports the activities in solid waste recovery. The simplest way of waste separation in every community is separate into dry and wet wastes. Dry wastes include the recyclable materials will be sold to the recycling firms, or to the tricyclists, or given to scavengers. Wet wastes will be discarded or used for composting. The involving individual households have collected their recyclables to sell to recycling firms. 3.2.4 Supermarkets, trade and commerce There are four large-scale supermarkets and medium scale markets in the city play a specific role. They produce a significant amount of cardboard and packaging material. The big supermarkets sell these materials directly to the big recycling company others trade with formal sector or donate it to needy people... 3.3 Types and prices of recyclables Recyclables for trading in Phitsanulok City are divided into various types, however, they can be grouped into six main categories, and several grades of materials in each category are given different prices depending on their quality. Prices of recyclables vary depending according to demand and supply, and the market competition, too. These sub-categories are presented in table 2. The highest variation is indicated within the category of metal scraps. Table 2 Types and prices of recyclables. Type Price [Baht/kg] Average Price [Baht/kg] Newspaper 2.70-4.00 3.35 Paper and Cardboard 1.00-2.70 1.85 Glass bottles 0.40-1.60 1.00 Aluminum cans 30.00-44.00 37.00 Plastic 3.00-4.00 3.50 PVC boots and flippers 7.00-8.00 7.50 Used batteries 6.00-7.00 6.50 Metal scraps (Cu, Pb, Brass, etc.) 17.00-50.00 33.50 Crushed coconut meat 1.50-1.70 1.60 Coconut meat 3.50-4.40 3.95 Steel (except Stainless Steel) 1.50-5.00 3.25 2002: 1 = 39 Baht; 2003: 1 = 48 Baht
4 RECYCLING EFFICIENCY BY THE FORMAL AND INFORMAL SECTOR Various parties involved have different focal areas depending on what stage they have access either to the recyclables or the waste. In the following the variability of such a recycling cascade shall be exemplified by the informal sector, collection crews and landfill scavenger. 4.1 Function of the informal sector Not considering the collection crews and the landfill scavengers an indefinite number of participants operates in the informal sector. In the year 2000 the Phitsanulok municipality started an initiative to upgrade the informal sectors performance around 220 persons registered for that purpose. However, not all of them work in the recycling business as their main source of income. Around 90 tricyclists (bicycle and bikes) part of them scavenge part of them are itinerant buyers or both, pick-up traders and ordinary street scavenger collected recyclables during the time of the survey. Additionally several small shops (5-10) work in localized surroundings, sometimes move from one to the other place. Casual traders are around, too but cannot be numbered. On a monthly basis the informal sectors trader collect about 950 tons of valuables. Main portions are glass and especially disposable bottles, which are reconditioned for further use, metals in particular steel from construction sites, and packaging materials mainly cardboard. To a minor extent plastic is collected (figure 2). In most cases recyclables are purchased or collected at source on a more or less regular basis from an established clientele accordingly high quantity and quality can be achieved. Glass 38% Glass bottles 11% White glass 10% Mixed glass 17% Mixed paper 11% Cardboard 15% Paper 27% Newspaper 1% Miscellaneous 2% Batteries 1% Mixed plastic 4% Plastic bottles 2% Non-fe me tals 3% Aluminum 2% Steel 21% Metals 26% Plastic 6% Figure 2: Composition of recyclables collected by the informal sector. 4.2 Involvement of the collection crews For the time being solid waste collection by the municipality is operated on a seven day basis with 19 vehicles and 46 crew members. For the collection crews waste separation is granted by the administration and it is one way to increase their incomes. With the permission of the municipality they have to deliver their recyclables to one single company. The profits from selling recyclable materials will be shared between the driver and two to three crew members.
From survey, the trucks will collect waste two times a day and earn about 800 Baht per truck from selling the materials. On a daily basis collection crews segregate 4-5 tons of recyclables. Their annual yield is estimated to reach 1,630 tons. As the collection crews have to segregate from the left-over or do not have access to specific fractions like steel from construction sides their main targets beverage containers especially cans as well as glass and plastic bottles. Compared to the other contributors of the informal sector they target more plastic (31% to 6%) and aluminum (8 to 2%) but collect less ferrous metals (7% to 21%). Materials obtained are of lower quality but quantity seems not to be too erratic. Paper 31% Glass 35% Mis cellaneo us 1% Plastic 16 % Non-Fe metals 2% Aluminum 8% Fe-Metall 7% Figure 3: Composition of recyclables collected by collection crews. 4.3 Landfill scavengers role There are 32 registered scavengers on the landfill. Around 20 people are working regularly. Habitually, they work as family teams with 2-3 persons a team. Each family earns 5,000-6,000 Baht per month; they sell directly to two traders who will come to buy at the landfill site once a week. Glass bottles 58% Paper and cardbo ard 13 % Plastic container and bags 24% Aluminum cans 1% Fe-Metall 4% Figure 4: Composition of recyclables collected by landfill scavengers.
The quantities of recyclables have been reduced since the municipality has allowed the informal sector and the collection crews to separate the wastes. Waste arriving at the landfill contains only to a minor portion valuables mainly glass, paper and plastic. Each category of recyclables sorted out at the landfill is shown in Figure 4. The landfill scavengers collect roughly 20-22 tons/ month. There are some kinds of recyclables which will be separated upon request from the buyers such as compact discs (1Baht/kg), instant noodle envelopes (0.1 Baht/envelope), video cassettes, and other packaging materials. Compared to the original percentage of ferrous and non-ferrous metals (mainly steel and aluminum cans) the retrieved portion is very low. Although the waste has undergone an intensive segregation still recyclables most of it at lower quality arrive at the landfill. An obvious high percentage of plastic bags and sheets are not sorted out because of poor quality and lack of the demand. At the end of the recycling chain after several stages of segregation a small amount of recyclables is still present and only those items, which are not salable at all, will be dumped. 4.4 Aggregate input of the formal and informal sector The contribution of all individual groups to recycling activities is quite reasonable (figure 5).It is extrapolate from the two phase survey that 19,200 tons have been collected throughout 2002. The major part nearly 60% is accumulated by various members of the informal sector. The super markets and the various businesses of trade and commerce play another vital role. They manage their primarily packaging waste by themselves considering the revenue of these sales as part of their business. A number of households act in a similar manner and are going to sell directly to the formal sector. At the back of beyond waste collection crews and landfill scavengers can remove another 11-12 % of the total amount of recyclables. The remainders consist of mainly valueless plastics (30%) and paper (0.6%, organics (45%) and a non-sortable fine fraction (20%). Informal sector 58,7% Collection crews 9,4% Scavengers 2,0% Supermarkets 13,9 % Trade and co mmerce 7,4% Ho us e ho ld 7,8% Schools, MC 0,7% Figure 5: Overall contribution to the recycling activities of Phitsanulok. The composition of the entire recyclables renders a slightly different picture what has been discussed in previous chapters. Compared to the composition of fractions collected by different actors of the informal sector trade and commerce and the supermarkets with predominantly packaging materials alter the distribution likewise considering that the informal sectors
contribution is the major part by weight a change in the distribution is coherent. Accordingly paper and cardboard accounts for the dominant fraction of 36%, glass and metals represent both at 26% typical recyclables. Whereas the plastic fraction, which hold an important share with collection crews and landfill scavengers dropped to a meager 9%. A similar experience we might realize in industrialized countries where plastic s value is disregarded and it deems hardly worthwhile to segregate and re-process plastic materials. The only items of interest are all kind of plastic containers (PET and others). Paper, cardboard 36% Glass 26% Miscellaneo us 2% Batteries 1% Plastic 9% Non-Fe metals 2% Aluminum 3% Figure 6: Composition of all recyclables collected. Fe -Me tal 21% 5 FINAL REMARKS While there is little scope for recycling as part of a national waste disposal plan, so far, the informal and formal sectors perform very capable and fill the gaps of the municipalities solid waste management program and the application to the communities. In a solely demand-supply system it is assumed that they obtain a high efficiency and effectiveness without the support of the very often low-performing official and only legitimate solid waste management system. The efficiency of the current recycling system based on an in-depth analysis of the local recycling system has been proved. In total 19,200 tons of material has been recycled that is around 38% of the entire waste generation in view of 31,400 tons only have been landfilled (figure 7),. The role of municipalities of developing countries can enhance recycling activities and stipulate the introduction of similar, indigenous systems. Especially where recycling is not or not satisfactory performed and where local administrations have no legal power to force people to participate in recycling activities, incentives in waste recycling and waste minimization given the specific boundaries of developing countries have to be elaborated. The informal sector plays a major role in recycling system of municipalities in developing countries; consequently, the municipality should support them in both technical and financial aspects, as well as retains the responsibility for enforcing environmental standards and supervising the sectors.
Was te to landfill 62,0% Super markets 5,7% Trade commerce 3,0% Schools, 0,3% Households 2,7% Informal s ector 22,5% Scavengers 0,6% Collectio n crews 3,2% Figure 7: Waste reduction by formal and informal sector activities ACKNOWLEDGEMENTS The authors wish to express their gratitude to the Municipality of Phitsanulok and all the people of Phitsanulok in particular those of the informal sector giving what ever kind of support they were able and willing to give for making this survey a valuable one. REFERENCES Amin, A.T.M.N., Sinha, M. A.H., MD.(editor)., 2000. Community Based Solid Waste Management: The Asian Experience. Paper and proceedings of the Regional Seminar on Community Based Solid Waste Management, Dhaka., Waste Concern. Bangladesh. Chantarakiri R., Vithal G., 2002., Wongpanit Garbage Management System and Somthai Wongcharoen. Rattanasuwan Printing, Phitsanulok, Thailand. Haan., C.H., Coad, A., and Lardinois, I., 1998., Municipal Solid Waste Management: Involving Micro-and Small Enterprises, Guideline for Municipal Managers. International Training Centre of the ILO, SKAT, WASTE. Office of Statistic, 2001. Homepage of the Municipality of Phitsanulok. The Municipality of Phitsanulok, URL: http://www.phsmun.go.th Poerbo, H., 1996. Urban Solid Waste Management in Bandung: Towards an Integrated Resources Recovery Systems. Environment and Urbanization: 4, 60-69. Romanos, M., and Chifos, C., 1996, Contribution of the Urban Informal Sector to Environmental Management., Regional Development Dialogue, 17, 1, Spring 1996. Suwarnarat, K., 1996., Solid Waste Management Perspective of Bangkok, A Crisis Situation. Proceeding of the Joint Symposium for Solid Waste Treatment., Bangkok.