Globally, a staggering 1.2 million plastic bottles are used every minute1. Most are used only once before they become plastic waste, destined to decompose in landfills or pollute the world’s oceans. Less than 10% of all plastics are recycled, according to the OECD, which estimates global plastic waste generation will almost triple by 2060 to 1,014 million tonnes2.
As well as cutting out single-use plastics, increasing the circularity of the plastics industry will be vital to a sustainable future.
True circularity – where reclaimed bottles are used to make new ones – has the potential to eliminate the use of raw materials entirely, but this is not easy. Unless “super clean” recycling processes are used, bottles can leach chemicals into drinks3. “Bottle-to-bottle” recycling therefore requires thorough decontamination to pass muster with international food safety regulators.
Bariq, headquartered in Giza, Egypt’s second largest city, is the first and biggest bottle-to-bottle recycler in the Middle East and North Africa (MENA) region. Founded in 2012, the company takes used bottles, extracts the polyethylene terephthalate (PET) then processes and decontaminates it to make food-grade rPET – the “r” denoting the PET is recycled.
This rPET is supplied as pellets to major international bottle and food-container makers throughout Europe and the US, who melt it to fill moulds for new products. Bariq’s food-grade pellets are certified by the US Food and Drug Administration and European Food Safety Authority, among others.
Bariq recycles 1.6 billion bottles annually, producing plastic with 87% less carbon dioxide emissions than a virgin plastic factory4. In February, the company announced plans for a new plant, expected to commence operation in 2023, to help reach its goal of recycling 50 billion bottles by 20305.
To support Bariq’s expansion, HSBC is providing the company with domestic trade loans, import documentary credit and clean import loans to finance purchases of the plastic bottles that are the raw materials for its recycling operations. The funds also support the underlying direct costs related to Bariq’s recycling business.
The trade financing instruments form part of HSBC’s Sustainable Trade Instrument Proposition (STIP), a framework designed to connect HSBC’s expertise in global trade and receivables finance with the group’s goal of mobilising USD1trillion of sustainable finance and investment by 2030. Customers qualify for STIP products by supporting sustainable economic activities that demonstrate clear environmental or social benefits.