20140312 dato abj@ukti smartcitiesseminar_kl

The Required Regulatory Measures and the Necessary
Economic Policy Instruments for the Transformation of Waste
Management Services to Resource Recycling Industries in
Malaysia
by
Dato' Ir Dr A. Bakar Jaafar, PEng, FIEM, FASc
Chairman of Association of Environmental Consultants and
Companies of Malaysia (AECCOM)
Professor, UTM Perdana School of Science Technology
Innovation Policy www.utm.my and Co-Chair, UTM Ocean Thermal
Energy Centre (OTEC), Kuala Lumpur, Malaysia
12 March 2014 InterCon
KL
UK Trade & Investment Smart
Cities Seminar
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PREAMBLE:
NOT TO LITTER, DO RECYCLE!
• Is it yet in the blood?
• Not yet; not in practice, nor even part of the
culture in Malaysia, and the like of it!
• So! What’s the solution?
⇒“… money in everyone’s pocket?”
⇒Government intervention: not only through
regulatory measures, but also the application of
a number of economic & fiscal policy
instruments
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Cities Seminar
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Cities Seminar
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CITIES that I have been to … How SmartClean?
• Singapore, Hong Kong; Tokyo, Osaka, Niigata, Kyoto, Yokohama, Fukuoka, Imari,
Naha, Kumejima; Seoul, Pohang;
• Newcastle, Armidale, Sydney, Wollongong, Canberra, Brisbane; Auckland, Rotorua,
Wellington, Dunedin, Christchurch;
• Honolulu, Los Angeles, San Diego, San Francisco, Reno, Eugene, Seattle,
Cincinnati, Chicago, Houston, Columbus, Washington DC, Pittsburgh, New York,
Lexington, Buffalo,
• Edison, Vancouver, Calgary, Winnipeg, Ottawa, Toronto, Montreal, St.Johns, Halifax,
Hamilton; Beunos Aires, Rio de Janeiro;
• London, Liverpool, Manchester, Glasgow, Oxford, Cambridge, Edinburgh, Bradford,
Cardiff, Brighton, Bristol, Bath, Reading;
• Paris, Strasbourg, Nancy, Geneva, Lausanne, Basel, Zurich, Munich, Hannover,
Frankfurt, Bonn, Stockholm, Uppsala, Copenhagen, Rotterdam, Brussels, Rome,
• Mecca, Medina, Riyadh, Dhahran; Bahrain; Dubai, Abu Dhabi; Nairobi, Johannesburg
• Karachi. Mumbai, New Delhi, Hyderabad, Chennai;
• Bangkok, Phuket; Manila, Baguio City; Bali, Jakarta, Jogjakarta, Bandung, Bodor,
Surabaya, Palembang, Pekanbaru, Dumai, Medan; Hanoi, HoChiMinh, Danang;
• Alor Star, Ipoh; JB, Kuala Lumpur, Kuantan, Kangar, KK, Kuching, KB, KT, Labuan,
Melaka, Penang, PJ, Putrajaya, Seremban, Shah Alam,
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OUTLINE OF PRESENTATION
1. Policy in Review
2. Proposed Policy Framework: Regulatory
Measures with Appropriate Economic
Instruments
3. Proposed Policy and Institutional
Arrangements
4. Policy-Driven Technology Development
5. Conclusion

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UK Trade & Investment Smart Cities
Seminar 6
1972 Statement of Malaysia at the UN Conference on
Human Environment in Stockholm
In urban areas “solid waste collection was
satisfactory but the disposal system was largely
by controlled tipping and burning. The disposal
of waste was like those in many countries, and
an organized programme in this direction was
needed. The local authorities in many cases
were hampered by lack of trained and
experienced personnel, financial resources and
knowledge of the effects of health.” In rural
areas, “solid wastes were buried or burnt but
there was room for considerable improvement in
this area.” (Malaysia, 1971:10, 12).

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The Outline Perspective Plan
(2001-2010) (OPP3),
• To adopt “a comprehensive waste
management policy … as well as
to formulate strategies for waste
reduction, reuse, and recycling.”
(Malaysia, 2001:187).

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The 8th Malaysia Plan (MP) (2001-
2005)
inter alia “to introduce various
initiatives and appropriate
economic approaches such as
incentives and collection charges
to reduce the amount of solid
waste.”(8th MP: 550).

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EXISTING POLICY FRAMEWORK
GENERAL:
• OPP-3: waste-recycling industry;
• 8th
& 9th
Malaysia Plans: “Polluters-pay
Principle” (PPP)?;
SPECIFIC:
• Non-Applicability of PPP; thus, the need
for the “Indifferent Consumers-pay” (ICP)
Principle and other economic-instruments

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NON-APPLICABILITY OF “POLLUTERS-PAY” PRINCIPLE

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Cities Seminar
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1. Policy in Review
Measure with Appropriate Economic
Instruments
Arrangements
5. Conclusion

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Cities Seminar
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LEGAL FRAMEWORK
LAW:
• Solid Waste and Public Cleansing
Management Act 2007;
• Solid Waste and Public Cleansing
Corporation Act 2007
SPECIFIC REGULATIONS:
• Waste Segregation or Separation
@Source?

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Cities Seminar
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REGULATORY MEASURE
Waste
Segregation,
Separation
or Sorting @Source

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THE FIRST STEP FORWARD: SEGREGATION @SOURCE

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Cities Seminar
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THE SECOND STEP FORWARD: HOUSEHOLD
COMPOSTING
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1. Policy in Review
Instruments
Arrangements
5. Conclusion

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Cities Seminar
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INDIFFERENT CONSUMERS-PAY (ICP) PRINCIPLE
• Those who recycle, get rewarded with
“smart credit points”;
• if not, pay a certain “Blue or Green” Levy
when purchasing new targeted items e.g.
goods in plastic bottles or containers

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PROPOSED SCHEME by INDIFFERNT CONSUMERS-PAY PRINCIPLE
GOVERNMENT
CONSUMERS
ε- NP2
O
•Non-Profit +
•Non-Private
Org.
RETAILERS
WASTE
EXCHANGER
MANUFACTURING
INDUSTRIES
W2E
COMPANY
LANDFILL
OPERATOR
STORAGE
SALES OF GOODS
CONTAINING
RECYCLED
MATERIALS
SALES OF GREEN
ELECTRICITY
•Soft Loan
•Study Grant
•R&D
•Policy Studies
•Education
•Training
•Awareness
•Investment
Return old items
Receipt of
Credit Points
Pay Levy or
Redeem Credit
Points
Return of Levy
Annual
Policy Review
Performance
Report
Purchase of
Goods
GRID
TO
THE
WASTE
TO
MATERIALS
Commission
KL

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UK Trade & Investment Smart Cities Seminar 19
INDIFFERENT CONSUMERS-PAY (ICP)
PRINCIPLE & STRATEGY
• Principle: Indifferent Consumers Must
Pay!
• Strategy:
1. Consumers to purchase new item by returning the old
one or by exchanging the goods with smart credit
points; and
2. Consumers earn smart credit points by returning old
items

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Cities Seminar
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COMPARATIVE APPROACH BY COUNTRY
Polluters
Litterbugs
Proposed Approach
for Malaysia
CONSUMERS
Enforcement
eg: Singapore
Polluters Pay
Principle/Take-Back
Policyeg: Germany
INDUSTRIES

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Cities Seminar
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EXISTING POLICY FRAMEWORK
GENERAL:
• OPP-3: waste-recycling industry;
• 8th
& 9th
Malaysia Plans: “Polluters-pay
Principle” (PPP)?;
SPECIFIC:
• Non-Applicability of PPP; thus, the need
for the “Indifferent Consumers-pay” (ICP)
Principle and other economic-instruments

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Cities Seminar
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INSTITUTIONAL ARRANGEMENT
1. SWM Corp/Local Authorities (LAs) “… waste
segregation @source … ”;
2. Ministry of Finance (MOF): “… blue-green LEVY … &
SMART Credit Points”; Malaysia ReCyclable
ExCHANGE;
3. Ministry of International Trade and Industry (MITI): “…
Producers’ Responsibility … ”;
4. Ministry of Domestic Trade and Consumer Affairs
(MODTCA/SIRIM): “…Product Eco-Labelling … ”;
Ministry of Energy,
5. Green Technology and Water (MEGTW): “Very
Attractive Feed-in-Tariff”;

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…INSTITUTIONAL ARRANGEMENT
6. MNRE/Department of Environment (DOE): “Trust Fund
for sorted HHW …”
7. Ministry of Agriculture (MOA): Quality of
Compost
8. Ministry of Natural Resources and the Environment
(MNRE): “CDM Project Approval & Carbon Credit … ”;
9.Ministry of Women Affairs and Family
Development (MOWAFD): Household & Public
Awareness Campaigns
10. PM’s Department: Policy Directive &
Coordination; KPIs by Constituency

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UK Trade & Investment Smart Cities Seminar 24
1. Policy in Review
Instruments
Arrangements
5. Conclusion

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Seminar
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Envisaged Practices Drawn From the ICP-Principle
Waste generators would
voluntarily sort the items to be
“disposed off” into: “Toxic”,
“Dry” or not perishable, and
“Wet” or perishable, and
deposit them, in order to earn
“credit points” with equivalent
cash value, at designated
collection centres,
Those who gather, sort, and
deposit any “toxics” at the
designated centres would
earn premium credit points.
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CONCLUSION
For integrated solid waste management in
Malaysia to be in place, it would require at
least:
• ONE Policy Directive,
• ONE Awareness Campaign;
• ONE Regulatory Measure;
• ONE Fiscal Measure;
• EIGHT Enviro-Economic Policy
Instruments

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THE EIGHT ENVIRO-ECOMOMIC POLICY
INSTRUMENTS
1. Indifferent Consumers-pay Principle and Levy;
2. Recycling Reward Points;
3. Recyclables in Commodity Exchange;
4. Producers’ Responsibility;
5. Eco-Labelling;
6. Attractive Feed-in Tariff for Energy from
Waste;
7. Compost Product Certification; and
8. Carbon-Credits.

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TERIMA
KASIH
‫شكر‬
(syukran)
谢谢 (xìe
xìe)
Thank You
Merci
Gracias
Спасибо

Prof Dato’ Ir Dr A Bakar Jaafar, PEng, FIEM, FASc,
KMN, JSM, DPMP
BE (Hons) (Newcastle), MEn (Miami), PhD (Hawaii)
Professor,
UTM Perdana School &
[1 June 2013-31 May 2016]
(www.utm.my)
Co-Chair
UTM Ocean Thermal Energy Centre (
www.otec.utm.my)
29
Chairman of AECCOM
(www.aeccom.org.my)
KL
Cities Seminar

20140312 dato abj@ukti smartcitiesseminar_kl

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