Co-Operatives Benefit Waste Recyclers

By Medina, Martin

The recycling of municipal solid wastes in developing countries relies largely on waste pickers. It has been estimated that, in Asian and Latin American cities, up to two per cent of the population survives by waste picking. For years they survived by their own wits, but in the last ten years or so their circumstances have been improved by the formation of co-operatives. Martin Medina picks out the most successful.

A municipal waste dump in Mexico City with informal waste collectors sorting and bagging different types of waste.

Waste pickers recover materials to sell for reuse or recycling, and diverse items for their own consumption. They are a disadvantaged and vulnerable segment of the population and face multiple hazards and problems. Due to their daily contact with garbage, waste pickers are usually associated with dirt, disease, squalor, and perceived as a nuisance, a symbol of backwardness, and even as criminals.

Waste pickers are regarded as a negative influence on the operation of sanitary landfills because they obstruct the operations of machinery and in extreme cases control the movements of vehicles on the site, running it like a mafia, and even stealing batteries

and other valuables from trucks. Yet they survive in this hostile physical and social environment. Their poverty and substandard working and living conditions are often due to their exploitation by middlemen and political bosses.

When waste pickers organise themselves into co-operatives they can improve their incomes, their working and living conditions, and contribute to solving the problems of insufficient collection and inappropriate disposal of solid wastes in developing countries.

Waste picking and recycling not only provide a livelihood for a significant proportion of many urban populations, but it can also reduce the costs of long-distance transport and disposal of municipal solid wastes, and reduce the imports of raw materials such as aluminium and fibre for paper making.

Formation of recycling co-operatives

Industries that consume recyclables encourage and support the existence of middlemen or waste dealers who are the link between industry and the waste pickers in order to ensure adequate volumes and quality of the raw materials that they use. As a result, opportunities arise for the exploitation and political control of the waste pickers, since they must sell their pickings to a middleman, who in turn sells to industry. Industry demands a minimum quantity from their suppliers and will not buy materials from individual waste pickers. Industry usually also demands that the materials are clean, sorted, and baled or crushed – processing that the middlemen carry out.

Most Third World waste pickers can be considered to be poor, according to their low income, their low purchasing ability, their substandard living conditions, and the fact that not all their basic needs are satisfied. This poverty can be largely considered to be the result of the low prices they are paid for the recyclables. The low prices paid for recyclables, in turn, enable the middlemen who purchase the recyclables from the waste pickers to generate high profits.

Middlemen can achieve high profits wherever they operate in a monopsonistic market (markets in which there is only one buyer). In Mexico City, for instance, dumpsite pickers must sell their pickings to their leader, who sells the materials to industry at a markup of at least 300 per cent. As a result, Mexico City dumpsite pickers usually earn incomes lower than the minimum wage, are forced to live around the dumps, and have a life expectancy of 39 years.

Similar situations are common elsewhere in the developing world. The formation of recycler co-operatives attempts to improve the living conditions of waste pickers by circumventing the middlemen, thereby enabling the payment of higher prices to co-operative members. Efforts to promote the creation of recycler co-operatives are common in Latin America and Asia, as the following examples show.

Successful recycler co-operatives in Latin America

Colombia

One of the most dynamic recycler cooperative movements in the world today exists in Colombia. The Fundacion Social, a non- governmental organization, has been assisting waste pickers in the formation of co-operatives since 1986. That year, a sanitary landfill replaced an open dump in the city of Manizales, displacing 150 families that, until then, had been recovering materials at the dump. The Foundation helped the displaced waste pickers to form a co- operative. When the positive impact of that effort became apparent, the foundation began assisting groups of waste pickers in other cities to also create co-operatives.

In 1991, the Fundacion Social launched its National Recycling Programme, which at present includes over 100 recycler co- operatives throughout the country. The Foundation also awards grants, provides loans for specific co-operative projects, and offers the co-operatives legal, administrative and business assistance, as well as free consulting services.

In 1998, the Foundation donated and made loans to the co- operatives for over US$800,000. Any new co-operative may decide to join the National Recycling Programme, which developed an organisational structure that includes national, regional and local associations of co-operatives. The Bogota Association of Recyclers, for example, represents seven recycler co-operatives located in the capital city. All five regional associations and the individual co- operatives also belong to the National Association of Recyclers (NAR). The NAR’s goals include educating Colombians on the social, economic and environmental benefits of recycling, as well as improving the working and living conditions of Colombian waste pickers. The NAR employs former waste pickers to provide assistance to any group interested in creating a co-operative.

The co-operatives affiliated to the Fundacion Social’s National Recycling Programme represent a wide variety of working conditions. Some members use pushcarts to transport materials, while other use horse-drawn carts or pickup trucks. Some, such as the Co-operativa Reciclar, in Cartagena, are located next to the local dumps, from which members salvage materials. Others follow established routes along city streets, retrieving items from containers placed at the kerbside for collection or from materials littering public places. Still other co-operatives take part in source segregation programmes, collecting recyclables from households, offices, commercial establishments and small industries, sometimes under formal contracts. Recycler co-operatives have formed regional marketing associations, which allow them to accumulate and sell recyclables in significant volumes, obtaining prices that are higher than what would be paid to each co-operative individually.

A waste collector’s house near an indiscriminate dump in Mexico City.

In total, Colombian waste pickers recover and sell over 300,000 tons of recyclables a year, mostly paper, glass, scrap metals, plastics and organics. Cooperative members report a higher standard of living, as well as improvements in self-esteem and self reliance compared to when they worked independently and on their own.

The Co-operativa Recuperar is one of the most successful recycler co-operatives in Colombia and Latin America. Recuperar, based in Medellin, was created in 1983 and today has 1,000 members, 60 per cent of them women. Members of Recuperar earn 1.5 times the minimum wage and are affiliated to the Colombian system of socialised medicine.

The co-operative’s staff working at a dump in Mexico City.

Members can receive loans from the co-operative, scholarships to continue their studies, and have life and accident insurance. Recuperar carries out three types of activities

* It offers waste collection and disposal services. Co-operative members collect mixed wastes and source-separated recyclables. Recuperar signed a contract with the city of Guarne and now collects, transports and disposes of the solid wastes generated in the town. In 1996, Recuperar earned 30 million Colombian pesos (approximately US$ 30,000) and the contract saved the city 5 million pesos (about USS 5,000). The cooperative also operates a materials recovery facility (MRF). In 1998, Recuperar recovered 5,000 tons of recyclables, mostly paper, cardboard, glass, metals, textiles, and plastics.

* Recuperar provides cleaning and gardening services to the local bus terminal, private companies, public spaces, local fairs and conventions.

* The co-operative offers its members as temporary workers that can be hired by public or private organizations to perform various activities.

Brazil

Important efforts to support the formation of recycler co- operatives also exist in Brazil. Cooperatives have been formed in Rio, BeIo Horizonte, Recife, Niteroi and Salvador. In Rio de Janeiro alone, 14 cooperatives exist with 2,500 members. In Porto Alegre, waste pickers were incorporated into the city’s kerbside recycling programme, reducing overall costs, and serving 79 per cent of the city’s 1.1 million residents.

Waste collectors picking through a dump of waste at Tultitlan, Mexico City

CEMPRE, an industry association, has prepared an educational kit for waste pickers and N\GOs to help them in the creation of recycler co-operatives. CEMPRE publishes a monthly newsletter and manages a data bank on solid waste management, as well as a scrap broker hotline that answers questions about recycling.

Coca-Cola, Mercedes-Benz, Nestle, Pepsi-Cola, and Procter & Gamble are among the companies that support CEMPRE financially. CEMPRE’s success has encouraged efforts to create similar programs in Argentina, Costa Rica, Mexico and Uruguay.

Coopamare, one of the most successful recycler co-operatives in Brazil, collects 100 tons of recyclables a month, equivalent to half of what is collected by the government recycling programme in So Paulo, and at a lower cost. Coopamare members earn US$ 300 per month, twice the minimum wage in Brazil. In comparison, half of the country’s labour force earn less than US$ 150 a month.

Mexico

The Sociedad Cooperative! de Seleccionadores de Materiales (SOCOSEMA) that operates in Juarez, on the U.S.-Mexico border across from El Paso, Texas, constitutes one of the most successful recycler co-operatives in Mexico. Today, members recover nearly five per cent of the wastes arriving at the municipal dump: 150 tons of paper, cardboard, glass, rubber, plastics, animal bones, organic material, and metals each day.

Until 1975, before the co-operative was created, a middleman had a concession to recover the recyclables at the dump. The middleman, operating in monopsonistic markets, paid low prices for the materials recovered by waste pickers, and dictated which materials he would buy. As a result, waste pickers had very low incomes. In 1975, the middleman announced that he would buy only paper from then on, and at a lower price. The waste pickers protested immediately. With the assistance of a college professor, supported financially by a local businessman and a sympathetic Mayor, the co-operative was formed. That year, local authorities awarded a concession to the co- operative for the recovery of recyclables contained in the wastes arriving at the dump. The impact of the creation of SOCOSEMA was impressive: within a few months of its creation, and the displacement of the middleman, the incomes of the members increased tenfold.

The co-operative also receives donations of recyclable materials largely paper and scrap metal – from the assembly plants at the border (popularly known as maquiladoras). SOCOSEMA members provide cleaning services to these plants. As well as now enjoying higher incomes, members of the co-operative participate in training courses and formal education programmes sponsored by the cooperative, and have access to health care and to legal protection.

SOCOSEMA has developed good relations with industry, despite initial reluctance to do business with the cooperative. Industrial demand for recyclables in Mexico is strong, and the cooperative often buys materials from independent waste pickers in order to satisfy the demand. Over the last few years, the creation of recycler co-operatives has gained momentum in the region, and co- operatives have been created in Argentina, Venezuela, Peru, Ecuador, Guatemala, and Costa Rica.

Successful recycler co-operatives in Asia

Philippines

The formation of recycler co-operatives has also gained impetus in Asia over the last few years. In Manila (Philippines) the non- governmental group Women’s Balikatan Movement created the Linis Ganda programme. Originally developed as a formalised system of waste pickers and itinerant buyers of recyclables working for a particular middleman in the city of San Juan in 1983, the programme is now composed of co-operatives.

Today, there are co-operatives in each of the 17 cities and towns that comprise Metro Manila. In this programme, waste pickers – called eco aides – have fixed routes for purchasing segregated recyclables at households and schools. Eco aides wear green uniforms and use green pushcarts or bicycles. At present, the programme includes 897 middlemen organized into 17 co-operatives and approximately 1,500 eco aides. Eco aides affiliated to the programme recover 4,000 tons of recyclable materials per month.

The co-operatives can obtain lowinterest and collateral-free loans from the Philippine Department of Trade and Industry and from the Land Bank. Linis Ganda plans to start composting operations and biogas recovery from market and slaughterhouse wastes in the near future.

India

In Madras, the non-governmental organization EXNORA created a waste collection programme in low-income neighbourhoods. The programme formalised recycling activities in those areas. Waste pickers were incorporated as waste collectors, or street beautifiers. Communities obtain loans to purchase tricycle carts to be used as refuse collection vehicles by the street beautifiers. Before disposing of the waste, the street beautifiers recover the recyclables from the wastes they have collected. Residents pay a monthly fee equivalent to US$ 0.30 for refuse collection. Income from the fees is used to pay back the loans and to pay the street beautifiers’ salaries. Today in Madras, about 900 collection units involving waste pickers exist in the slums, as well as in middle- and upperincome neighbourhoods.

The programme has dignified recycling activities, raised earnings, reduced littering, increased refuse collection, and contributed to a cleaner urban environment. In the city of Pune, approximately 6,000 waste pickers formed a co-operative, which in 1995 recycled a quarter of the waste generated by the city’s one million residents.

Indonesia

Unlike the previous cases that involve industry and NGOs, Indonesia has enacted national legislation in support of recycling workers. In 1992, then President Suharto declared that waste pickers were beneficial to the country’s economy and environment. Now the central government supports the formation of co-operatives of dumpsite and street pickers. Private banks have granted loans to recycler co-operatives, and the national government has imposed a duty on imported waste materials, in an effort to increase the incomes of the waste pickers.

Lessons learned

NGO support needed

NGOs have played a critical role in assisting the formation and operation of recycler co-operatives. Their energy, creativity and familiarity with the local conditions allow them to develop initiatives that have a good chance of succeeding. They can help co- operatives to obtain loans and grants, or furnish the credit themselves. NGOs also provide essential technical, business and legal assistance to the co-operatives. Newly constituted co- operatives are particularly vulnerable, considering that they may have to deal with opposition from the middlemen being displaced. Industry may be reluctant to have their usual supply channels disrupted. And the authorities may covertly hinder the efforts to create a new recycler co-operative if a patron-client relationship exists between particular government officials and the waste pickers.

Bagging up sorted waste at a dump in Thailand.

Timing in the formation of a co-operative

The timing of the formation of a cooperative is an important factor in its success. A window of opportunity appears during changes of administration, particularly at the local level. A new mayor, especially one belonging to a different political party than his/her predecessor, may be more inclined to support a recently formed recycler cooperative in order to demonstrate his/her commitment towards the poor and in favour of change. Such an action could improve the mayor’s image and political standing. A mass media campaign conducted by the involved NGO to show the waste pickers’ plight, their harsh working and living conditions, as well as the benefits the community receives from their work, may increase public support for the waste pickers and their efforts to organise. Further, a grassroots information campaign can also be conducted among community leaders, schools, and neighbourhood associations. This approach has been successful in several Colombian cities.

Private sector involvement

Latin American and, to a lesser extent, some Asian countries have taken ambitious steps to involve the private sector. Private sector participation presents both risks and opportunities for waste pickers. Companies awarded contracts to collect and dispose of municipal solid waste usually do not allow waste picking in the disposal sites that they operate. Thus, as sanitary landfills replace open dumps, waste pickers are forced to collect materials on the streets instead, which lowers their earnings and affects their standard of living.

On the other hand, private sector participation does provide opportunities for recycler co-operatives. The co-operatives can render – on a commercial basis – services such as the collection of mixed wastes or recyclables, street sweeping, and the operation of composting plants and materials recovery facilities. The incorporation of waste pickers into formal solid waste management programmes and the awarding of contracts to recycler cooperatives can save cities money while providing a steady income to the waste pickers.

Conclusions

Waste picking represents an important survival strategy for the poor in developing countries. Individuals recover materials from waste in order to satisfy their needs. Despite the fact that waste picking occurs in quite different settings throughout the developing world, it shows distinct patterns. Waste pickers are usually poor immigrants from rural areas. The recovery of materials takes place in a wide variety of conditions, from open dumps to garbage floating in canals and rivers. Waste pickers respond to market demand and not to environmental considerations. The underlying factors that cause people to become waste pickers are poverty, the inability or unwillingness of individuals to obtain other forms of employment, and industrial demand for inexpensive raw materials.

Authorities often do not fully realise the social, \economic and environmental benefits of the recycling activities carried out by waste pickers. (It should also be pointed out that in some cases waste pickers create illegal dumps, thus causing pollution in congested urban areas.) Development banks also tend to ignore the benefits that recycling renders to society. Consequently, informal sector recycling is often ignored when waste management policies and plans are being prepared.

Picking over waste at a depot in Thailand.

On the other hand, when informal recycling is being considered in waste management plans, the objective is often to eliminate it. As long as poverty and industrial demand for materials persist, recycling will continue. Official efforts to eradicate waste picking have not succeeded and have caused further deterioration in the working and living conditions of recycling workers.

Middlemen perform useful services to industry, by sorting and processing materials, and storing them until they can sell them in the amounts that industry demands. But, particularly at dumpsites, opportunities arise for the development of monopsonistic markets, controlled by middlemen, and thereby the exploitation of waste pickers. The formation of recycler cooperatives can bypass the middlemen, dismantle the markets, and thus increase the earnings of recycling workers.

NGOs can play an important role in organising recycling workers and in helping them, particularly in the formative and initial stages of the operation of their co-operative. Development banks and bilateral development agencies should consider actively supporting recycling activities. Recycler co-operatives can be a means of achieving a better standard of living for their members, of giving dignity to their members, and of strengthening their bargaining power with industry and authorities.

Equally important for a cooperative is the support of the local authorities, who can legitimise their activities and award concessions or contracts for the provision of solid waste management services. Industry can also strengthen recycler co-operatives by purchasing materials from them and even by taking a more active role in supporting the formation of recycler co-operatives, as CEMPRE does in Brazil.

The most successful recycler cooperatives in Latin America Recuperar in Colombia and SOCOSEMA in Mexico – have learned that diversification can increase their earnings. Both cooperatives also provide cleaning services to municipalities and private industry. Other successful co-operatives add value to the recyclables they gather by processing the materials and engaging in the production of goods such as hoses and compost.

Waste pickers can be successfully integrated into formal solid waste management programmes for the collection and recycling of solid wastes. By supporting recycler co-operatives, low-cost refuse collection services have been extended into low income communities, creating jobs.

Instead of being a problem, waste pickers can be part of the solution to the seemingly intractable problem of collecting and disposing of solid wastes in developing countries. Recycler co- operatives can promote grassroots development in an economically viable, socially desirable and environmentally sound manner. When supported in the right way, waste picking can represent a powerful example of sustainable development.

For more information contact Deutsche Gesellschaft jur Technische Zusammenarbeit (GTZ) GmbH, Postfach 5180, 65726 Eschborn, Germany. E- mail Martin Medina: medina2525@aol.com Web site: http://www.gtz.de

Copyright Research Information Ltd. Sep 2005