Recyclers would be pleased to close the loop on various valuable materials such as metals, paper, plastics, e-scrap and so on, but there are many challenges that need to be addressed including the legislative framework, lack of accurate data, infrastructure issues, technology, investments, etc., to make this happen. Panelists at the roundtable session “The State of the Recycling Industry in Saudi Arabia” held in March discussed and debated various topics related to the recycling industry in the Kingdom. They provided an overview of recycling in the country and the opportunities, explored the changes in governance, strategy and what it meant specifically for the recycling sector, and also addressed major topics and possible steps that could help advance the industry.

Sharing his views on the current recycling landscape and key topics shaping the industry in Saudi Arabia, Eng. Sami Safran, Group President MEPCO, said he has been in the industry for almost two decades, and has been observing the development of waste management sector and the evolution of the Saudi vision in terms of transforming and finding alternatives to divert 99 per cent of the waste away from landfills by 2035. “When we started recycling, we had to invest in waste management since it was a totally unregulated market and a majority of the recovered material was exported. So, we invested and tried to develop the market over the past two decades.”

Moving forward, he said in the last five years he has seen a mass transformation since the government announced their ambitions regarding waste diversion and enhancing recycling. “The recycling rate has now increased to 14 per cent as compared to previous years and the target is to reach over 80 per cent.”

Summarising the major changes, he said public awareness regarding waste recycling has improved greatly, and many players have entered the sector; there are numerous CSR initiatives; there have been investments in MRFs in different areas, and though some of them have been facing challenges due to lack of regulations, etc., others are faring well. “This really gives us an indication that every year we will be witnessing a major evolution in the sector, because MWAN is very aggressive since they launched the regulations, and they have started to build a waste database, which is something that was missing. The municipalities are now recording not only the types of waste going to the landfill, but one of the KPIs is the recovery of material. I can say that things are moving in the right direction,” he noted.

Richard Davidson, Middle East Director-Waste, Ricardo Energy & Environment, who moderated the discussion, said, as per figures available, the global recycling industry’s worth stood at USD 57 billion globally at the end of 2021 and is expected to grow to reach 88 billion by 2030. “We are fortunate to be in a growing industry,” he noted, adding that the sector has faced an unprecedented period of change with many factors such as the pandemic, the global focus on environment and sustainability, import restrictions in many countries, plus all the geo-political events impacting the industry. In KSA too there is massive change with new developments and regulations being formed, he said.

Touching upon organic waste, a major waste stream in the region, Hesham Al-Jabr, Founder and CEO of Tadweer said it was the first company to convert organic waste into compost. He said a report published by the Ministry of Environment indicates that about 30 million tons of food are wasted every year. “We are actually in the early stages in terms of treating organic waste. We might have accomplished quite a lot in recycling some other streams like paper, plastic, etc, but in terms of organic waste we are on the right path now and our goal is to attain high recycling rates, but there is a lot of effort needed to achieve those figures.”

On the topic of Green Building standards and the impact it could have in terms of waste recycling, Hani Razeq Hani Abdel Razeq, AESG, said, when they developed the Mostadam Rating System - the new green building rating system developed by the Ministry of Housing in Saudi Arabia, there were discussions about mandating targets for waste recycling as a minimum requirement to make it work, “but things are still evolving.” KSA has achieved massive progress in certain areas, but in order for the programmes to succeed at a national scale, more infrastructure, and more collaboration and awareness are required, he stated.

When they launched the regulation, the waste recycling targets were optional, he said, adding that certain projects are trying to achieve this, and many mega projects in KSA that have ambitious targets are doing their best to eliminate waste, from design to modular systems or installing recycling facilities onsite to limit their waste and so on. “This is a positive development. The overall landscape is significantly changing and the more infrastructure we have, the easier it will be to achieve the targets. Recently, major entities have announced significant recycling facilities for different streams.”

The technologies for recycling are readily available, but the challenge is to ensure ways to get the right quality feedstock for recycling, commented Hani Tohme, Senior Partner & Head of Sustainability, Roland Berger. “It is a matter of logistics and controlling your value chain, and without the regulation or the infrastructure, or the right players and right access, you will not get there.”

The reason for a positive trend in KSA is the fact that the first fundamental of the market is being addressed, which is the governance, he noted. The moment the policy maker, regulator and operators are in place, one understands the right steps to get things right. In the past not only was a majority of the material going to landfill, but there was also leakage of value while the kingdom could actually benefit from those resources locally. Once the logistics and the waste flow are organised, it is up to the recyclers to decide on the treatment methods, what materials can be recycled locally and the benefits, and discuss the financial viability of the projects, he noted. “That is why I have strong hope and belief in the market today as I see regulations falling in place, investments and infrastructure happening. I also see discussions about gate fees, which is amazing because you are treating the waste as you should.”

Responding to Tohme’s comment on leakage of resources, Eng. Sami said, they had observed that out of the collected capacity of one million tons of recovered paper, about 25-30 per cent was being leaked outside while local companies need the material. Accordingly, local companies have been replacing the volume by importing. Early last year, MWAN had stepped in and started to regulate the market by controlling it through the regular process of issuing licence for export. “Thankfully, since the regulations came into force, we have seen some rationalisation” and now the local prices are close to the international prices which is very reasonable, he remarked. This enables the industry to grow in a healthy manner, helps increase their capacities to improve the recycling rates in the country, he said.

While there is a standard for recycled materials, including the grades, purity levels required, especially in the construction sector, these are not specifically mandated in a stringent way at present, said Hani Razeq. There is more focus on sustainability in terms of regulations, building codes, etc. and there are some initiatives, but it’s at an early stage and at the moment it is happening more on a voluntary basis, he said. “There are some inspiring requirements in the regulations that will promote recycling and sustainable practices, all of which will help minimise waste. Yet, there are some difficulties. On the positive side KSA relies on local manufacturing in many areas, which directly helps reduce carbon footprint related to import/export, etc. All these are a chain of activities that will help contribute to achieving a circular economy.”

On the role of the informal sector in recycling and concerns related to scavenging, Eng. Sami said waste collection is at present happening through two major channels, one of which is the scavengers. The second one is the collection happening legally through commercial contracts and municipal contracts. There has been a drastic change over the last two decades, he observed. For instance, he said in 2000, about 70 per cent of the material supply was by scavengers, but in the recovered paper segment, they have managed to change that figure and at the moment, the company collects 100 per cent of the material. There are other players who have improved their collection systems as well, and the illegal collection has reduced as compared to earlier period, he elaborated.

Saudization is seen as an important step towards economic success, but it is a challenge as there is not much interest in this sector, said Hesham Al-Jabr. Especially in organic waste management, one can barely find a Saudi expert in the field, he noted.

Responding to Al-Jabr’s comment, Hani Tohme said there may not be great enthusiasm among young Saudis to engage in the sector in its present state. However, the more the sector adopts automation or innovates, there will be a lot of interest, he stressed. If there is waste segregation and automated waste recycling facilities are introduced, companies would be looking for process engineers and other technical experts, and will find quite a different reaction from the market and individuals to the sector. “We are witnessing progressive ideas from the leaders who represent Saudis. There is tremendous interest in sustainability and circular economy in general and people are eager to participate and contribute. The question is, how can the sector change in a way that the standards improve and how can we make sure that the jobs that are unattractive for Saudis no longer exist,” said Tohme.

Government initiatives to support waste diversion

 A few years back, KSA government had announced its ambition to divert 99 per cent of the waste away from landfill, with about 80 per cent to be recycled. As part of that initiative to subsidize it they have launched MWAN, said Eng. Sami. Environment monitoring agencies were also introduced; and SIRC, an investment company to support the development of the waste and recycling industry, was formed. “In the last five years a lot of projects have been announced in terms of recycling, the latest one being the setting up of an RDF plant in Riyadh. Projects like NEOM, Red Sea Development, etc., have a complete plan for waste recycling. So, there are many activities planned on the ground and I believe we will see major progress in the sector.”

Government mandate key to enhance the recycling sector

In Hani Razeq’s view, in order to develop this sector, government mandate is key. It could be in different forms including stipulated procedures, fines, and so on, he said, adding that a simple step like rejecting waste skips that contain recyclables will influence the waste generators and contractors. Fees similar to ‘pay as you throw’ happening in Europe can be introduced, where you pay according to the amount of waste generated, the number of times you need to collect the waste, and other environmental considerations, he underscored. “A government mandate is a main driver for the industry to achieve these goals. There are many major projects doing it voluntarily as they target circular economy, but regulations will ensure every single person in the society will act responsibly so the industry progresses.”

Overcoming bottlenecks in recycling

Feedstock is one of the bottlenecks in utilisation, so does one overcome this and other challenges? One has to go back to the starting point and figure out how to reduce the waste, and when it is generated, plan the pre-collection and then the collection process to improve the feedstock, said Hani Tohme. “The focus should be on source segregation. A bare minimum would be to separate the recyclables from organic waste so you can preserve the material that is not contaminated for recycling. And I believe the regulation is currently looking into the pre-collection and sorting at the source.”

There have been trials in Riyadh that have been successful, but people tend to lose interest quickly if they don’t see the end result, he added. So, in order to launch source segregation, one needs to have the right tools and infrastructure and recycling should take place, so the results are visible, he declared. “That would be the biggest initiative as it would simplify the value chain going forward.”

Tracking the waste is very important, he underlined. “If you know where it is you can deal with the waste; if you don’t know where it is and how much there is, then you will lose track of it and eventually it starts leaking, and goes in the wrong direction.”

In Tohme’s view, financing is an important topic in the industry and the flow of funds, be it through EPR or through tariffs on citizens, the polluter pays concept should be definitely applied, he said. Discussions about recycling should also focus on new technologies that are available, how the market is moving in that direction, and how can one create the maximum value for KSA, he elaborated.

Eng. Sami agreed with Tohme, adding that every year they would be witnessing major developments and the next step would be to share more details about the technology and optimisation issues, etc. “The good news is that in Saudi we are moving in the right direction in terms of implementing the waste management strategy properly.”

Any successful project needs a triangular model including regulations, investment and awareness, said Hesham Al-Jabr.

One important thing is that there is a need for proper data on waste including source of generation, types of waste being generated, the frequency and many other factors that can influence the roadmap for zero waste, said Hani Razeq. Secondly, he said the community needs more confidence in the infrastructure as they would like to see results. “I have had different conversations with different kinds of people from various industries who express their desire for better waste management, but feel that the waste collected ends up in landfills. So, we need to build more confidence in the society that it is actually happening in the right way and collaborate with all stakeholders to achieve the results.”

One other topic to be addressed is the government’s commitment to net zero, decarbonisation and how the waste and recycling sector supports those aspirations, and what else can the sector do to support the circular economy, said Richard Davidson. “In reality, recycling is probably at the bottom end of the circular economy, so there’s a lot more to talk about and to do.”