Subsidies flowing to the production of primary plastic polymers (PPP) are under scrutiny this week in Switzerland. The hand-outs reduce production costs, incentivise new investment, and help make virgin fossil-based polymers more competitive than recycled plastics and competing alternative or substitute materials, noted the Quaker United Nations Office, in a new briefing paper written with Eunomia, a consultancy.
They have estimated total global subsidies to PPP in 2024 exceeded $80bn, and could rise to $150bn by 2050 under a business-as-usual scenario. This would put them above the level of fisheries subsidies.
These plastic subsidies “reinforce a linear and extractive economic model and undercut efforts to transition into more sustainable and just patterns of production and consumption”, the note reads.
A number of major food and drink brands have set targets to increase the level of recycled plastic content they use in their packaging, but most are failing to reach these. Some have begun to roll back on their commitments as the price gap between virgin and recycled plastic widens for commonly-used polymers like PET.
But removing the subsidies won’t have a major impact on the prices consumers pay, said Eunomia and QUNO. In the case of fast-moving consumer goods such as a bottle of water, a bottle of soft drink, or a carton of juice, the plastic content of the product is contained in the packaging and accounts for “a small share of the overall product weight and price”, they write. “For these products, the average price increase resulting from the removal of subsidies to polymer production ranges from 0.14% to 0.90%.” Their modeling also shows that complete removal of the PPP subsidies would lead to a “significant reduction in primary plastic polymer production, with a larger reduction observed in economies with higher levels of subsidies”. This would bring “meaningful benefits for both human health and environmental sustainability”.
