Business
Can the plastic recycling industry be saved?
MaryLou CostaTechnology Reporter
Getty ImagesIn the plastic recycling industry, the casualties keep coming.
Waste management company Biffa’s Sunderland plant closed in February after opening in 2022 at a cost of £7m, while rival Viridor closed its Avonmouth plant in 2022, Skelmersdale in 2023 and confirmed this summer that its Rochester plant would close, too.
Like falling dominoes, plastic recycling plant closures have been endemic across Europe too: another big name, Veolia, will close its two German operations this year, while seven plastic recyclers closed in the Netherlands last year.
Meanwhile, companies Borealis, Dow and Nester have all dropped plans to construct new plastic recycling plants in Europe.
Industry body Plastic Recyclers Europe equates this to the loss of nearly one million tonnes of plastic recycling capacity since 2023.
“Without decisive political action, Europe will replace its recycling industry with dependency on unsustainable imports and growing volumes of waste, undermining both its economic resilience and its climate leadership,” the organisation told the BBC in a statement.
And more closures are likely, warns James McLeary, managing director for Biffa’s polymers division, as the industry here and in Europe faces its most challenging year yet. High energy and labour costs here are two factors, in parallel with the fact that sourcing virgin and recycled plastic from Asia is currently cheaper than buying European recycled plastic.
Plastic recycling plant closures are affecting the US as well, also prompted by the low price of virgin plastic, causing the country to miss its recycled content targets, as S&P Global reports.
“There’s a big global dependence building on Asian plants, and we then have the situation where (plant operators in the UK and Europe) are going to make very tough decisions. Either they run their plants at a point where they’re literally not making anything, or they decide to close,” explains Mr McLeary, who is based in County Durham.
Getty ImagesA dependence on exporting plastic waste also hasn’t helped. The UK exported around 600,000 tonnes of plastic waste last year, according to environmental analysts at ENDS Report – 5% more than in 2023.
Loopholes in current UK legislation mean plastic waste collectors are inadvertently incentivised to export rather than process domestically. Meanwhile, manufacturers using plastic packaging are still inclined to use cheaper virgin plastic from abroad, and stomach being taxed for it.
Ahmed Detta, CEO and founder of plastic waste recycler Enviroo, is frustrated by the flaws and contradictions that he feels are plaguing the industry and disrupting the goal of creating a circular economy that keeps materials in use for as long as possible.
“For me, a circular economy is a win-win. Every single person in that journey has to have some benefit, and that’s not working,” says Mr Detta, who is based in London.
“Brands aren’t aligning with the circular economy. They’re saying, ‘why should I buy recycled material when it’s cheaper for me to pay the fine for the plastics packaging tax, than actually pay for recycled materials? No one is saying, ‘let’s unite’.”
BiffaSo concerned is RECOUP, a UK-based plastic recycling independent authority, that its head of policy and infrastructure, Steve Morgan, warns: “We are almost witnessing the demise of plastic recycling as we know it, unless we have some interventions. There’s no way a lot of recyclers in the UK can compete.”
UK regulations have benefited foreign markets more than they have the UK, and serious reform is needed, Mr Morgan argues.
“There are an awful lot of fantastic technologies developing. But it’s a scale up of those and how they can actually make money, to continue to exist and then also thrive, is the secondary thing,” says Mr Morgan, who is based in Peterborough.
“The commercial viability long term is just not there at the moment. There are some really good people producing technologies that we couldn’t even dream of 10 years ago. But I just feel we’re not going to see any real change in the next two to three years without some intervention.”
RECOUP is urging the UK government to introduce a single plastic recycling certification scheme aimed at reducing the export of plastic waste and making more companies more inclined to use recycled packaging.
Mr Morgan is optimistic that a UK government consultation this year will seriously consider what changes should be implemented to save the plastic recycling industry.
Plastics EuropePackaging reforms are indeed being implemented, alongside £10bn of investment in new plastic sorting and processing facilities, according to a spokesperson from the UK Department for Environment, Food and Rural Affairs (DEFRA).
They also say the Deposit Return Scheme, launching in October 2027, will create higher quality material for recycling, as consumers will be encouraged to return drinks bottles and cans to collection points to collect the small deposit they will have paid on purchase. The government has also convened a Circular Economy Taskforce.
“Our collection and packaging reforms will support UK-based recycling, meaning we can reduce our dependency on exports of plastic waste,” says the spokesperson. “The export of waste is subject to strict controls set out in UK legislation.”
Over in Brussels, Virginia Janssens is the managing director at Plastics Europe, which represents plastic producers, including those with recycling operations and that use recycled materials. She’s concerned that the plastic recycling industry is set to flourish outside Europe.
“Business will go where it makes sense and where it’s cheapest to build. If those big production plans are built somewhere else, with huge investments of billions, they’re not all of a sudden then going to decide to go back and build one in Europe,” says Ms Janssens.
“It will have a huge effect on our value chain. It would set us back to 20 years ago, when we would have to incinerate or use landfill more, and that would be a real shame. Nobody wants this.”
But there are some bright spots in an otherwise struggling industry.
Biffa, for example, has recently acquired bottle manufacturer Esterform, which uses recycled PET.
Meanwhile, Enviroo recently secured £58m to build a new recycling facility in the north-west of England, specialising in converting PET drink bottles into a recycled granulate that can be used in food packaging.
Due to be operational by 2026, the plant is expected to process up to 35,000 tonnes of plastic annually.
Mr Detta believes being a specialist in an industry of generalists, and going back to the fundamentals of plastic recycling, will be his key to success.
“I’m not here to tell you I’ve got the most innovative technology. No – I’ve looked at the real, hardcore problems and said, ‘What is it that I need to resolve?”
Plastic Energy, meanwhile, is successfully converting plastic waste into pyrolysis oil that can be used to make food and medical grade plastic. Headquartered in London, the company has plants in Spain, France and the Netherlands.
CEO Ian Temperton is preparing to benefit from an anticipated under supply of recycled plastic as recycled content targets kick in across Europe: by 2040, plastic drinks bottles must contain at least 65% recycled content.
“We’re about developing and continuing to enhance the technology that deals with waste plastics. Having partners commit to new investments over the next couple of years is going to be a bit harder, but it’s very clear the market will be very significantly under-supplied against any version of the targets,” says Mr Temperton.
“So I will keep my team focused on the best technology for when that comes.”
Business
‘Can a dead economy grow at 8.2%?’: FM Sitharaman rebuts Trump remark in Lok Sabha; cites IMF ratings upgrade – The Times of India
Finance Minister Nirmala Sitharaman on Monday cited India’s strong growth and sovereign rating upgrades to counter claims that the country was a “dead economy”, telling the Lok Sabha that such upgrades would not have been possible if the economy were weak, PTI reported.Responding to Opposition members who sought the government’s reaction to US President Donald Trump’s description of India as a “dead economy”, Sitharaman said India remains the fastest-growing major economy, recording 8.2% growth in the September quarter.“The economy in the last 10 years has transitioned from external vulnerability to external resilience,” the minister said while replying to the Supplementary Demands for Grants for 2025-26 in the House.“Every institution is raising our growth outlook for this year and the forthcoming year. There are clear expressions (from the IMF) recognising India’s growth and no dead economy gets a credit rating upgrade by DBRS, S&P and R&I,” Sitharaman said.Trump had made the “dead economy” remark in July while expressing disappointment with India’s decision to continue buying oil from Russia. Sitharaman said data and assessments by global institutions contradicted that characterisation.“The economy today has moved from fragility to fortitude,” she said.“So somebody said something somewhere, however important that somebody is, we should not depend on that but rely on data available within the country and also data coming from elsewhere. Rely on data,” she told Opposition members.“Can a dead economy grow at 8.2%? Can a dead economy get credit rating upgrades?” Sitharaman asked.The Reserve Bank of India last week raised its GDP growth projection for FY26 to 7.3% from 6.8% earlier. India grew 8.2% in the September quarter and 7.8% in the June quarter.On concerns raised over the International Monetary Fund’s assessment of India’s national accounts — including Gross Domestic Product (GDP) and Gross Value Added (GVA) — Sitharaman said India’s overall grading remains unchanged at the median rating of ‘B’.She said the IMF had flagged the outdated base year for national accounts and suggested rebasing. “So to say that there has been a downgrade by IMF is misleading the House. For this year, IMF gave B for overall statistics,” she said, adding that India has remained the fastest-growing major economy for the fourth consecutive year despite the pandemic.Sitharaman also addressed concerns over public debt, saying India’s debt-to-GDP ratio rose to 61.4% after Covid but was brought down to 57.1% by 2023-24 due to policy measures taken by the central government.“By this year-end, I expect it to come down to 56.1%,” the finance minister said.
Finance Minister Muhammad Aurangzeb underscored Pakistan’s strategic shift from seeking aid-based support towards trade- and investment-led engagement to ensure long-term economic sustainability and mutually beneficial partnerships, particularly with the Gulf Cooperation Council (GCC) countries.
In an interview with CNN Business Arabia, Aurangzeb highlighted the vision of Prime Minister Shehbaz Sharif, which reflected Pakistan’s renewed economic confidence and reform momentum.
He said that Pakistan has followed a comprehensive macroeconomic stabilisation program for the past 18 months, which has delivered tangible and measurable results, while inflation has declined to single-digit levels from an unprecedented 38%.
On the fiscal front, Pakistan has achieved primary surpluses, while the current account deficit remains well within targeted limits. According to the finance czar, the exchange rate has also stabilised, and foreign exchange reserves have improved to approximately 2.5 months of import cover, reflecting strengthening external buffers.
He maintained that the country has two major external validations, which indicate Pakistan’s improving economic outlook.
Firstly, he said, all three international credit rating agencies have aligned their assessments this year by upgrading Pakistan’s ratings and outlook. On the other hand, the country has completed the second review under the IMF Extended Fund Facility, with the IMF Executive Board granting its approval earlier this week.
He stated that such developments demonstrate growing international confidence in Pakistan’s economic management and reform trajectory.
The finance minister further emphasised that macroeconomic stabilisation has been achieved through a coordinated approach combining disciplined monetary and fiscal policies with an ambitious structural reform agenda.
“Reforms are being implemented across key areas, including taxation, energy, state-owned enterprises, public financial management, and privatisation, aimed at consolidating stability and laying the foundation for sustainable growth,” Aurangzeb said.
The finance minister also highlighted the significant progress in Pakistan’s improvement of the tax-to-GDP ratio.
“During the last fiscal year, it increased to 10.3 per cent, with a clear path towards 11 per cent,” the finance minister said.
He further explained the government’s objective to reach a level of tax collection that ensures fiscal sustainability over the medium to long term.
“This is being pursued through widening the tax base by bringing previously undertaxed but economically significant sectors such as real estate, agriculture, and wholesale and retail trade into the formal net, alongside deepening compliance by reducing leakages through production monitoring systems and AI-enabled technologies. Simultaneously, the tax administration is being transformed through reforms in people, processes, and technology,” he said.
The minister further highlighted efforts to improve governance in [power] distribution companies, involve private sector expertise, advance privatisation, and reduce circular debt, which has long constrained the power sector.
“Rationalising the tariff regime is essential to making energy more competitive for industry, thereby enabling industrial revival and economic growth,” he stressed.
Senator Aurangzeb acknowledged the longstanding support of GCC countries, including Saudi Arabia, the United Arab Emirates, and Qatar, for their critical role in critical role supporting Pakistan through financing, funding, and cooperation at international financial institutions such as the International Monetary Fund.
“This relationship is now evolving towards a new phase centred on trade expansion and investment flows. Remittances continue to play a vital role in supporting the current account, with inflows reaching approximately $38 billion last year and projected to rise to $41-42 billion this year, over half of which originates from GCC countries,” he added.
He further said, “Pakistan is actively engaging with GCC partners to attract investment in priority sectors including energy, oil and gas, minerals and mining, artificial intelligence, digital infrastructure, pharmaceuticals, and agriculture.”
Expressing optimism regarding progress on a Free Trade Agreement (FTA) with the GCC, he termed the discussions at an “advanced stage”.
Senator Aurangzeb reiterated the government’s strategic direction in shifting the collective focus on trade rather than relying on aid.
“Pakistan’s future lies in fostering trade and investment partnerships rather than reliance on aid,” said the finance minister.
He also emphasised the role of foreign direct investment in supporting the higher GDP growth, generating employment opportunities, and delivering shared economic benefits for Pakistan and its partners.
“The government is fully mobilised to translate this vision into reality.” He concluded.
The State Bank of Pakistan (SBP) has announced a 50-basis-point cut in the policy rate in its final monetary policy decision of the current year, signaling a cautious shift as inflation shows signs of control.
The State Bank has issued its last monetary policy of the current year, reducing the policy rate by 50 basis points. As a result, the base interest rate has been lowered from 11% to 10.5%, according to the central bank.
This marks the first rate cut after a prolonged period of policy stability. The interest rate has been cut by half a percentage point after seven months.
The decision was taken during a monetary policy meeting after a detailed review of key economic indicators, the State Bank said. Officials cited improved inflation trends as a key reason for adjusting the policy stance.
The move reflects a shift away from continuously maintaining high interest rates.
Policy rate timeline
December 2024: Policy rate set at 13%
January 2025: Reduced to 12%
March 2025: Maintained at 12%
May 2025: Further reduced to 11%
June 2025: Maintained at 11%
July 2025: Maintained at 11%
September 2025: Maintained at 11%
October 2025: Maintained at 11%
December 2025: Reduced to 10.5%
The State Bank of Pakistan has cut the policy rate by 0.5 percentage points after maintaining it at 11% for seven months, reflecting a cautious shift toward monetary easing.
Inflation under control, policy stance adjusted
The State Bank acknowledged that inflation has come under control, prompting a change in its long-standing tight monetary policy. Previously, the central bank had kept the interest rate unchanged at 11% for four consecutive policy decisions.
This easing suggests growing confidence in macroeconomic stability.
With the reduction in the policy rate, bank loans for businesses and industries have become cheaper. Analysts say the cut may provide some relief to the private sector by lowering borrowing costs and supporting economic activity.
However, the reduction remains modest compared to market expectations.
Experts point to IMF influence
Economic experts say the State Bank’s tight monetary policy remains influenced by the IMF program, limiting the pace of rate cuts. Despite the reduction, the policy rate is still around five percentage points higher than the current inflation rate of 5.5%, analysts noted.
This gap indicates continued caution by the central bank.
The business community has repeatedly demanded a cut to single-digit interest rates as inflation declines. However, experts say the State Bank has once again ignored these demands, opting for a gradual approach.
Despite the government’s desire, analysts believe interest rates could not be brought to single digits in 2025, reflecting fiscal and external constraints.
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