UAE considers a tax on packaging to fund recycling

Reuters/Rula Rouhana

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The UAE is considering introducing a tax on packaging, according to an industry expert, as the country continues to ramp up its sustainability agenda.

Ali Al Dhaheri, CEO of Abu Dhabi Waste Management Company, or Tadweer, told AGBI that discussions with the UAE government were taking place about bringing in an extended producer responsibility (EPR) scheme, or something similar, for producers of plastic.

The scheme could see companies pay a fee for the amount and type of packaging they produce. That money would then be used to fund the existing recycling infrastructure and boost recycling levels in the Gulf state. 

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“We are happy to be part of that discussion, looking at the EPR scheme and model to be adopted and implemented across the UAE,” said Al Dhaheri.

The world is producing twice as much plastic waste as two decades ago, with the bulk of it ending up in landfill, incinerated or leaking into the environment, and only 9 percent successfully recycled, according to a 2022 report from the Organisation for Economic Co-operation and Development.

The amount of mismanaged or uncollected litter stands at 40 percent for countries in the Middle East and North Africa, with 54 percent of waste sent to landfill, 1 percent incinerated and just 5 percent recycled.

“I think there has to be some alignment and some unification of the incentives [for recycling], but the other part which is equally important is enforcing levies or taxes or EPRs on producers of the majority of the products or consumables or materials that actually end up as waste,” said Al Dhaheri.

EPR schemes have been adopted by many countries around the world and are most commonly used for electronics, packaging, vehicles and tyres.

Al Dhaheri suggested any scheme would be rolled out in a phased manner and there would be “much more clarity” on how it would look in 2024.

From the start of next year, the UAE will impose a nationwide ban on single-use plastics. In January 2026 the country will ban the import of plastic cutlery, drinks cups, polystyrene foam and boxes.

It forms part of the wider target set by the UAE to achieve net-zero emissions by 2050.

Recycling was listed as the top priority for tackling climate change in a survey of Dubai companies conducted by AGBI and the British Business Group ahead of the Cop28 climate summit in Dubai. 

Of the 72 BBG member businesses asked, more than three quarters (79 percent) plan to prioritise recycling over the next year.

Tadweer, which joined the energy and utilities portfolio of sovereign wealth fund ADQ in December last year, has spearheaded the Waste to Zero voluntary coalition, which was announced at Cop28 this week.

The coalition, which has the backing of the UAE Ministry of Climate Change and Environment and Roland Berger, is made up of governments of all levels, NGOs and the private sector with the mission to decarbonise the waste management sector and transform waste into resources.

Incentives in store

Earlier this week an international consortium led by Roland Berger and Sharjah-based Beeah Group, in collaboration with Dfinity Foundation, and the International Solid Waste Association, demonstrated the world’s first global incentive system to counteract the solid waste footprint.

The full-scale platform, which emphasises the responsibility of everyone to mitigate their environmental impact, promoting standardised processes and transparency on offset activities, is set to be developed and officially launched in 2024.

It is estimated that the waste management sector is responsible for 5 to 10 percent of greenhouse gas emissions.