Plastic Collective attracts landmark fundraising to tackle plastic pollution
Plastic Collective, a leading social enterprise focused on solving the plastic waste epidemic, is to receive funding through a bond issued by The World Bank.
The funding would cover plastic waste collection and recycling projects in Ghana and Indonesia.
The innovative bond provides investors a financial return linked to Plastic Waste Collection Credits, Plastic Waste Recycling Credits (collectively, plastic credits), and Voluntary Carbon Units (carbon credits) expected to be generated by the two projects.
Projects benefiting from the transaction include ASASE Foundation in Ghana and SEARcular by Greencore Indonesia, both plastic waste collection and recycling projects in Accra, Ghana and Surabaya, Indonesia, respectively.
The ASASE Foundation in Ghana, is a community-based plastic waste collection and recycling project established in 2019.
The project involves starting small recycling plants as social enterprises in communities where plastic pollution is most severe, and empowering women entrepreneurs to build their own plastic waste collection businesses as a sustainable source of income and employment.
The SEArcular by Greencore, Indonesia, a plastic waste collection and recycling plant established in 2018. It empowers coastal communities by providing training, employment and offering price premiums for the ocean bound plastic they collect.
SEArcular focuses on providing an appropriate end of life for more difficult to recycle plastic types.
According to a World Bank press release, Citibank acted as the sole structuring agent and bookrunner of the transaction.
The funding will help Plastic Collective’s mission to rid the world of plastic waste by channeling private capital to support plastic collection and recycling projects in remote and vulnerable communities to access sustainable finance and address extreme plastic leakage into nature and oceans.
“A core objective of the projects is to improve informal waste collector’s livelihoods. There are approximately 20 million people who collect plastic waste operating around the world – typically 80% are women.
“The projects supported by this bond are being certified under the Verra Plastic Waste Reduction Standard, Verified Carbon Standard and the newly launched Zero Plastic Oceans Plus Social Welfare Certification, which require important social safeguards to be met,” the statement added.
It said: “Today an estimated 78 million tonnes of mismanaged plastic waste leaks into nature and oceans every year and a further 318 million tonnes go unrecycled into landfill and incineration (OECD).
“The emergence of plastic credits, coupled with continuing education and effort to cut plastic use offer a prime opportunity to tackle this pressing environmental and social challenge,” it explained.
The statement quoted Steve Hardman, CEO, Plastic Collective, saying: “We’re both proud and excited to see this funding effort come to fruition.
“For almost a decade, Plastic Collective has been at the forefront of developing innovative and sustainable ways to fund plastic collection and recycling projects in the most disadvantaged communities around the world and to help provide finance to the normally unfinanceable,” he noted.
He said the funding would enable the expansion of facilities and production lines, and the implementation of social welfare programmes to enhance and protect the livelihood of informal waste pickers who are the foundation of these projects.
“We hope that this new approach to financing environmental, and social impact activities benefits many more in the future,” he said.
“This new bond is emblematic of the strong partnerships that are needed, particularly between investors, governments, financial institutions, and local delivery partners to achieve the Sustainable Development Goals (SDGs), including efforts to reduce plastics waste,” Jorge Familiar, Vice President and Treasurer, World Bank said.
“I am incredibly proud of the collaboration between the World Bank, Plastic Collective and Citi in launching this fourth Outcome Bond. Our collective effort innovatively uses VERRA-registered plastic credits to support two projects to reduce plastic pollution -a huge global challenge with particularly devastating impacts on emerging markets.
“This Outcome Bond allows fixed income investors to support development projects that would otherwise struggle to secure financing. We’re also responding to investor appetite for transactions with direct and quantifiable development impact.
“We are hopeful that these transactions will inspire others – and drive further positive change,” said Philip Brown, Global Head of Sustainable Debt Capital Markets.
Plastic Collective is a social enterprise which was founded in 2016 by Australian leading environmentalist Louise Hardman. Supported by government grants, Plastic Collective’s mission is to research and develop systemic approaches to reduce waste plastic, among other activities.
Source: GNA