The globalized nature of supply chains complicates the assessment of the life-cycle environmental impacts of plastic waste. Since 2019, approximately five million tons of plastic waste are traded annually, mostly exported from high-income to low-income countries. This export raises concerns about mismanagement, leading to severe environmental damage and health risks. Globally, less than 10% of plastic waste is recycled, with significant mismanagement in countries lacking adequate waste management systems. China's 2018 import ban redirected plastic waste exports to other countries, highlighting the issue. The European Union is considering a ban on plastic waste exports to non-OECD countries to promote domestic responsibility. Current studies often rely on assumed domestic or scenario-based recycling rates for imported plastic waste, lacking robust data support. This assumption is flawed because imported plastic waste is typically more concentrated and uniform than domestic waste, and importing countries pay for it, implying some economic value. Therefore, a financially viable approach must ensure at least partial recycling to offset import costs. This study addresses this gap by introducing a novel approach using the Required Recycling Rate (RRR).

Existing literature highlights the significant environmental challenges posed by the global plastic waste trade, particularly the mismanagement of waste in low-income countries. Studies like Wen et al. (2021) and Bourtsalas et al. (2023) have attempted to quantify the environmental impacts of plastic waste trade, but they rely on assumed domestic recycling rates which are not suitable for imported plastic waste. These studies demonstrate the urgent need for more accurate data on recycling rates for imported plastic waste to better inform policy and research. The low global plastic recycling rate (less than 10%) and the significant amount of mismanaged plastic waste in developing countries underscore the importance of a more realistic assessment of the recycling potential of imported plastic waste.

This study defines the Required Recycling Rate (RRR) as the minimum recycling rate needed to achieve economic break-even for imported plastic waste. The RRR was estimated for the 22 largest plastic waste-importing countries from 2013 to 2022. The analysis considered import prices, recycling costs (labor, electricity, rent), and the value of recycled plastics, using data from the UN Comtrade database for four plastic waste types (PE, PS, PVC, and others) and six primary plastics (HDPE, LDPE, PS, PVC, PET, and PP). 'Recycling' specifically refers to mechanical recycling, which is the predominant method in Global South countries. Import costs and primary plastic values were derived from 186,861 bilateral trade records. The RRR was calculated using a cost-benefit inequality equation. Sensitivity and Monte Carlo-based uncertainty analyses were conducted to assess the robustness of the results. The study also compared the calculated RRR with the collected national plastic recycling rates for the 22 countries. Data processing included handling outliers and missing values using mirror trade data, when available. Costs considered included imports, labor, electricity, and rent; physical losses were also accounted for. Labor costs were estimated using labor input intensity and hourly earnings data from various sources. Electricity costs were calculated using electricity consumption rates and industrial electricity prices. Rent costs were based on land area required for recycling and industrial rent data. Physical losses were derived from the literature. The sensitivity analysis involved assessing the impact of key variables on RRR. The Monte Carlo simulation used probabilistic distributions for the key variables to quantify the uncertainty in RRR.

The analysis reveals that a minimum of 63% of imported plastic waste must be recycled to achieve financial break-even across the 22 countries and four plastic waste types from 2013 to 2022. However, the RRR varies across countries and plastic types. Countries in Asia and Eastern Europe have lower RRRs (40-50%) than those in Western Europe and North America (61-82%). PE and PS waste have lower RRRs than PVC and 'Others'. PVC has a higher RRR due to its challenging recycling characteristics. The RRR significantly surpasses reported national recycling rates (average 23%), highlighting a substantial discrepancy. The gap between the RRR and national recycling rates leads to underestimation of recycled plastics from global North-to-South trade. Using the RRR, the estimated annual recycling volume from this trade surges to 1.04 Mt yr⁻¹, compared to 0.37 Mt yr⁻¹ using national recycling rates, a substantial increase of 0.67 Mt. Sensitivity analysis indicates that product price for recycled plastics has the greatest impact on RRR, followed by import costs and physical losses. Labor costs have a less significant influence, particularly in comparison to regional differences. Regional differences are particularly noticeable in labor costs, with Europe having significantly higher labor costs than Asia. Notable variations are found across waste types, especially for PVC and ‘Other’ types. These variations are primarily due to fluctuations in product prices and import costs.

The significant discrepancy between the calculated RRR (63%) and the average national recycling rate (23%) highlights the underestimation of recycled plastics from the global plastic waste trade. This finding has implications for assessing the environmental impact of this trade. Higher recycling rates, closer to the calculated RRR, translate to lower emissions from reduced virgin plastic production. The country-specific RRR values exceed those used in previous studies, leading to different estimates of environmental impacts. This research emphasizes the need for more accurate recycling rate data for imported plastic waste and suggests a different approach to setting recycling targets for imported plastics than for domestic plastic waste. The RRR can serve as a benchmark for countries when formulating recycling targets. The increased RRR observed in 2020, coinciding with lower crude oil prices, suggests that the economic feasibility of recycling imported plastic waste is sensitive to market prices of both virgin and recycled plastics. The significant gap between RRR and actual recycling rates indicates potential mismanagement, emphasizing the need for improved tracking systems and better waste management practices.

This study demonstrates that the economic viability of imported plastic waste recycling requires significantly higher recycling rates (63%) than previously assumed based on domestic recycling rates (23%). The country-specific RRRs provide a more accurate basis for assessing the environmental impacts of the global plastic waste trade and for informing policies aimed at improving waste management. Future research should incorporate additional cost factors, explore regional variations within countries, and address limitations in data availability and classification. Implementing transparent tracking systems and strengthening waste management infrastructure are crucial to minimize mismanagement and achieve more sustainable plastic waste management.

The study's focus on primary cost factors may underestimate the actual RRR, as it excludes additional costs like environmental costs and capital investment. The use of primary plastic exports as a proxy for recycled plastic revenue may also lead to some overestimation, especially in developed countries. Data limitations regarding regional variations within countries limit the granular level of analysis and could affect the accuracy of RRR calculations. The use of only four HS codes to represent the wide range of plastics might lead to underrepresentation of diversity and quality in plastic waste. Inaccurate trade data in transit countries could also influence RRR calculations.