Using incentives to put out fires [de/eng]
For many years the international media have carried prominent reports of the Agbogbloshie scrap market in Ghana. It is described variously as Europe’s largest e-waste dump, as one of the most polluted places in the world, or simply as hell on Earth – a place where the downsides of globalisation are ruthlessly revealed.
Nothing in these descriptions is actually wrong, but none of the metaphors captures the many different aspects of the place. The fact is that Agbogbloshie is not simply a dump, and the waste that accumulates there does not consist solely of illegal shipments of e-waste from Europe. It is more accurate to describe Agbogbloshie as a site that serves as a central marketplace for Accra’s informal scrap collectors, dismantlers and traders. Most of the arriving scrap comes from local usage, not directly from Europe. It is true that Ghana does receive considerable quantities of end-of-life and second-hand goods from Europe. In general, though, there are no direct supply links between the importers and the scrap-site workers; the inhabitants of Agbogbloshie collect their scrap laboriously by pushing hand carts around the neighbourhoods of Accra and thus play an important part in the city’s waste management system.
Many proposals for tackling the situation in Agbogbloshie have been put forward in recent years. The Oeko-Institut remains involved in these discussions; we have now had close working relationships with many local partners for more than ten years. The following picture has emerged from this collaboration:
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The international trade in electronic waste must be tackled. However, this will not of itself solve the problems – partly because the demand for electric and electronic devices is rising, in Ghana and most other countries worldwide.
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The collection and processing of scrap creates large numbers of jobs: reforms should aim to integrate existing workers.
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Not all the activities performed by the informal workers cause problems. Most of the pollution is created by a small proportion of the materials and processes, such as the open burning of cables.
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Technical means of preventing this pollution are available, but they are more laborious and expensive than the processes currently used. There is therefore a lock-in effect that encourages the informal recyclers to continue using their current practices: any technical improvements would directly reduce their net profits. On account of their precarious socioeconomic situation, the recyclers are understandably wary of such technical improvements, even though they would be good for the environment.
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Nevertheless, these particularly polluting practices must be urgently replaced by proper formal processes. However, traditional regulatory methods such as inspections and bans are doomed to fail, because the informal workers can always move their activities to other neighbourhoods and backyards and thus evade regulatory pressure.
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The incentive system therefore needs to be changed: collectors and recyclers must incur a direct economic benefit if they pass particularly problematic waste on to processors who can handle it properly. This aspect of incentives was incorporated into Ghana’s Act on hazardous waste and e-waste in 2016.
Working with local organisations, the Oeko-Institut introduced an incentive system of this sort and evaluated the results in the Gesellschaft für Internationale Zusammenarbeit (GIZ) project “Environmentally sound disposal and recycling of e-waste in Ghana”. Between October 2018 and August 2019, informal collectors and recyclers were able to hand in old cables at a collection point operated by the project in the scrap market.
For all items handed in the collectors received a compensation payment that was more than the actual material value of the cables. This created a system in which it was suddenly more attractive to hand in cables and their potentially polluting insulation rather than burn the coverings in open fires.
Many scrap collectors and recyclers were initially sceptical but came to realise that this model brought both economic and health-related benefits. After a gradual start, cables started to come in in a regular flow. Almost 1,400 individual deliveries were made, resulting in the collection of more than 27 tonnes of cable that were sent to sound recycling. At the same time there was a noticeable decline in the number and intensity of highly toxic cable fires.
The project team has submitted information on the scheme and the results to the Ghanaian Government. The project is currently being continued with the support of German financial cooperation and is being extended to additional types of scrap. Long-term financing is to be secured via the ‘polluter pays principle’. In consequence, Ghana has just started to raise an environmental levy on all imported devices. The money is earmarked and is to be used for proper collection and recycling – including appropriate incentive systems.
Andreas Manhart is a Senior Researcher in the Sustainable Products & Material Flows Division in Freiburg. Since 2005 his research at the Oeko-Institut has been concerned with the question of how social and environmental standards can be ensured even in highly ramified and globalised value chains.
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