Fourteen business associations propose to change recycling cost norms


Fourteen business associations propose to change recycling cost norms
Boxes made entirely from paper, containing no plastic or aluminum, are prioritized by consumers to be recycled many times over.

Reduce the cost of recycling

Fourteen associations, including the Food and Food Association of Ho Chi Minh City, Association of Seafood Exporters and Producers of Vietnam, Vietnam Tea Association, Business Association of Vietnam High-Quality Products, Association of Beer – Alcohol – Soft Drinks Thirty Vietnam, Vietnam Dairy Association, Vietnam Motorcycle Manufacturers Association, Vietnam Automobile Manufacturers Association, Vietnam Plastic Association, Plant Protection Drugs Business and Manufacturing Enterprise Association Vietnam has also made several proposals to implement financial contributions to Extended Producer Responsibility (EPR) – an environmental management program that is being implemented globally and effectively, minimizing difficulties for businesses in the current situation.

Accordingly, the Associations believe that the draft’s recycling cost norm (Fs) is calculated based on consultation studies with very large differences in results, so it is unreliable.

On the other hand, 14 Associations assessed that the formula for calculating Fs as in the current draft completely ignores the profit factor of businesses recycling from recycled materials, the recovery value of packaging. Therefore, the proposed Fs do not follow the circular economy principle because the value of recovered materials has not been deducted.

The draft proposes an Fs factor of 0.3 for paper, PET bottles and aluminium and; an Fs of 0.5 for iron and steel to reduce Fs for materials with high recovery value. This proposal of coefficient Fs is not reasonable because materials such as iron and steel, aluminium, paper packaging, hard plastic bottles (PET), means of transport, and recyclers of these materials are profitable due to the high value of these materials because recovered material is higher than the cost of recycling.

These materials create jobs and profits for many workers and recycling businesses; they are mostly collected, so there is little environmental risk. Therefore, it is not reasonable to ask manufacturers to contribute to support recyclers while those recyclers are profitable. Moreover, these are packages and products where the value of recovered materials is higher than the cost of recycling, so according to the circular economy principle, the coefficient Fs must be zero.

These associations suggest applying a factor of zero to materials whose recovery value is higher than the cost of recycling (such as the Norwegian and Danish models). For other materials with separate formulas, the administrative costs should be removed from the Fs norm because of the possibility of large price increases for many products and goods. For example, the price can increase by 1.36% for bottled water, 0.6% for canned beer, and 0.2% for milk bags causing difficulties for consumers during difficult economic times.

Four recommendations

To reduce difficulties for businesses, the fourteen associations suggested that, in the first two years (2024 and 2025) of implementing EPR, it is necessary to focus on implementation guidelines, not yet applying penalties, only collecting underpayments if the enterprise declares insufficiently or incorrectly, except in the case of deliberately not declaring or deliberately cheating because EPR is a very new policy, most Asian countries have not yet applied it. Implementing thousands of types of packaging and products is very complicated, requiring detailed instructions. In addition, many types of packaging and products do not yet have recycling technology or recyclers, so many businesses do not have solutions. If we immediately apply the sanction with a very high fine, it will be difficult and inconvenient for businesses when the new regulations have not fully guided them.

At the same time, allowing businesses to combine both self-recycling and paying for recycling support in the same year instead of having to choose one of the two methods because, in fact, many types of packaging and products There is currently no effective recycling solution. Businesses are finding the right recycling solution. This process can take a long time to test; during testing, it is not possible to determine the amount to be recycled.

For product packaging that uses recycled materials, the fourteen Associations suggested that there should be specific policies and regulations on incentives, exemptions and reductions in contribution to recycling support to create outputs for the material market recycled materials and promote the circular economy. Specifically, for the packaging that has used recycled materials, it is recommended to calculate the adjustment factor Fs equal to 0 and be counted as the enterprise that has fulfilled the responsibility for recycling.

This will encourage businesses to use recycled materials in packaging, increase resource efficiency, reduce dependence on raw materials in production, create outputs for the recycling industry and help promote the development of the recycling industry in Vietnam is decisive in promoting the circular economy model.

In addition, it is also necessary to develop a priority and incentive mechanism for environmentally friendly packaging materials; specifically, the coefficient Fs 0.5 is calculated.


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