1. The Informal Solid Waste Sector In Egypt:
Prospects for Formalization
Table of Contents
1. Background....................................................................................3
1.1. Introduction ................................................................................................................ 3
1.2. Purpose of the Study .................................................................................................. 4
2. Methodology...................................................................................5
2.1. Selection of Field Site ................................................................................................ 5
2.2. Questionnaires ............................................................................................................ 5
2.3. Sampling .................................................................................................................... 6
2.4. Data Collection........................................................................................................... 7
2.5. Profile of Respondents ............................................................................................... 7
3. Solid Waste Collection and Recovery..........................................8
3.1. Collection And Transportation ................................................................................. 11
3.2. Recovery of Primary Materials ................................................................................ 16
3.3. Contractual Agreements for Collection and Transportation .................................... 23
4. Trading Enterprises....................................................................26
4.1. Trading networks...................................................................................................... 27
4.2. Complementary Activities ....................................................................................... 28
5. Small Scale Recycling Industries...............................................29
5.1. Type and Growth of Recycling Industries ............................................................... 29
5.2. Trading Networks: Suppliers and Customers........................................................... 31
6. Labor............................................................................................35
6.1. Labor in Collection and Transportation ................................................................... 37
6.2. Labor in Recovery of Primary Materials.................................................................. 38
6.3. Labor in Trading Activities ...................................................................................... 39
6.4. Labor in Recycling Industries .................................................................................. 41
1

2. 7. Workplace....................................................................................42
7.1. Workplace for Sorting and Recovery ....................................................................... 43
7.2. Workplace for Trading Activities ............................................................................ 43
7.3. Workplace for Recycling Industries......................................................................... 44
8. Transportation.............................................................................46
8.1. Transportation for Collection and Recovery ............................................................ 47
8.3 Transportation for Recycling Industries ................................................................... 48
9. Capital..........................................................................................50
9.1. Capital for Collection and Recovery ........................................................................ 51
9.2 Capital for Trading Activities .................................................................................. 51
9.3. Capital for Recycling Enterprises ............................................................................ 53
10. Conclusions and Recommendations..........................................55
10.1. Conclusions .......................................................................................................... 55
10.2. Total Magnitude of Solid Waste Activity in the Informal Sector ........................ 55
10.3. Recommendations ................................................................................................ 56
10.4. The Future of Solid Waste Systems in Egypt ...................................................... 57
2

3. The Informal Solid Waste Sector In Egypt:
Prospects for Formalization
1. Background
1.1. Introduction
The informal sector around the world, as in Egypt, is an undisputedly large and growing
phenomenon in economic, social and political arenas. The informal sector has been, and
continues to be, a dynamic sector of the economy, providing employment and income
generating opportunities for hundreds of thousands of individuals. The role of the informal
sector in development continues to be an issue that is extensively and intensively debated
around the world. Academics, national planners, international organizations, development
practitioners and policy makers have all engaged in this debate. The role of the informal
sector and small-scale enterprises in the industrialization of developing countries is a critical
point in the debate. The design and implementation of different intervention programs in the
informal sector have varied across time and space. While many argue for the need to
formalize the informal sector, others insist that the informal sector is a source of economic
vitality and as such its dynamism and potential for growth lie in its adaptability to local
conditions.
The informal sector in Egypt plays an overwhelmingly significant and vital role in solid
waste management and has become an institution in its own right. This sector has been
growing over the last three decades. The scope and range of its activities has increased in both
depth and breadth as they meet new challenges to meet the increasing demands of a growing
city for garbage collection services and linking with a large national market for recovered
materials. This informal sector has now created a giant industry, which spreads across the
entire nation and provides a partial solution to man-made waste1. As the activities of this
sector have been growing in size and diversity, it becomes imperative for us to understand its
intricacies, its significance and its vitality.
Hordes of people in Egypt make a living of the waste, which the affluent discards. These
hordes consist of cleaning staff of municipalities, informal collectors, scavengers from
municipal containers on streets, dumpsite scavengers, the 'roamers', the small middlemen, the
large traders, the processors (plastic crushers, aluminum smelters, cloth grinders, paper
compactors, etc.) and the re-manufacturers. This creates working and income generating
activities for hundreds and thousands of individuals throughout the country, predominantly in
the informal sector. The informal sector in solid waste management has been steadily growing
in size and scope over the last three decades. During this time, this sector has grown in terms
of the volume of waste that it handles and has expanded and diversified the range of its
1
Iskandar, Laila. (Community and Institutional Development, C.I.D.)Waste Management, The Case of the Cairo
Municipality: The Informal Sector Recycling Program. Workshop Proceedings on Cost Recovery and
Public/Private Partnerships, General Assembly of MEDCITIES Network; Rome, December 1998.
3

4. activities, to becoming the most innovative and enterprising recyclers in the nation. The
recovery and recycling processes that are integral processes in this informal sector allow
Egypt to potentially recover about 80% of municipal solid waste, which is one of the highest
rates of recovery in the world. The informal settlements where the garbage is collected and
sorted have become hubs of activity, generating employment and income for thousands of
individuals. Over the years, the garbage collectors in these settlements have expanded their
activities beyond the physical confines of their locations, as was traditionally the case. They
have developed numerous forward and backward linkages to the national economy, both
formal and informal, and have become integrated in trading and manufacturing networks
throughout the nation. Their trading partners are spread in a vast network throughout the
country. This study focuses on one such group, namely the recyclers of Mokattam, Cairo as
the scope of our research was not broad enough to cover the whole of Egypt.
1.2. Purpose of the Study
The purpose of this study is to establish the credit-worthiness of that sector and their
potential role in a demand-driven credit and employment scheme linked to formal lending
institutions, donor-driven development interventions and the development of further small and
medium enterprises. The study does that by attempting to document the following about the
present sector activity:
1- Magnitude of the activity in the informal sector for municipal solid waste
management in Cairo
2- Employment Generation: the number of people working in the solid waste
collection and disposal in the informal sector in Cairo
3- Volume of trading in primary materials recovered in the informal sector
4- Magnitude of small recycling industries
5- Turnover of capital
6- Potential effects of formalization of that sector on the waste handling services in
Egypt.
It is our aim to assess the size of enterprises and economic activity in that sector, the credit
worthiness of small and medium enterprises in the informal sector, and the potential role
formal lending institutions can play in the further development of that economy.
Additionally, we will explore the inferences of these issues with regards to formalization of
certain sectors of the informal economy, and the impact that policy decisions have on
economic growth or stunting of certain vibrant sectors of the informal economy.
4

5. 2. Methodology
2.1. Selection of Field Site
For this study, we selected one of five garbage collectors settlements in and around the
Greater Cairo area. All the garbage collectors in these informal settlements serve the
residential areas in the city. We selected the Mokattam settlement as the field site for a
number of reasons.
In this settlement, the initial efforts of the transformation and formalization of
the trade of garbage collection took place.
The activities in this settlement represent the range of activities and processes
that form the entire system for solid waste collection and disposal in the city.
These activities range from collection, transportation, and recovery of primary
materials, trading and recycling.
It is the largest settlement in terms of population and activities.
Major endeavors during the 1980s in particular were critical in the development of
the trade of garbage collection in the settlement through mechanization, infrastructure
development, route extension, and credit programs for small and medium enterprises.
Conducting field research in the Mokattam settlement was an effort to gain more insight
into the depth and breath of the transformation of the settlement and more critically the
entrepreneurial aspect of waste handling.
2.2. Questionnaires
Three questionnaires were used in this study. Each focused on gathering information
about the specific activities that exist within the settlement of garbage collectors. The main
activities were: collection, transportation, recovery of primary materials, small and medium
enterprise (SME) trading activities and small scale recycling industries. A separate
questionnaire was used for each of the following; collection and recovery, trading activities
and recycling industries. The process of designing the questionnaire included the participation
of individuals from the settlement who had extensive experience with the occupation of
garbage collection. Several brainstorming sessions were held to develop the survey
instruments. The questionnaires were pre-tested in the field and modified and refined
according to the results of the pretest.
The information gathered on the collection, transportation and recovery processes was:
Collection routes
Type and number of households served
Volume of solid waste collected
Contractual arrangements between the garbage collectors and ‘waahis’
Labor
5

6. Cost of operation
Capital
Type and quantity of recovered primary materials
Methods of handling
Methods and costs of disposal of non-recovered materials
The questionnaire on the trading enterprises included information on:
Type and volume of merchandise
Labor
Operating costs
Capital
Trading networks
The information collected on the small scale recycling industries included:
Type of recycling activity
Labor
Operating costs
Capital
Trading networks
2.3. Sampling
The samples for the trading and recycling enterprise were drawn from a list of each type
of activity located in the Mokattam settlement. Our aim was to select a random sample of
20% of the sampling units for each of the three samples we had of the main activities in the
informal sector for solid waste management; collection of solid waste, trading in primary
materials and recycling industries.
In a survey conducted in January 2000, all the trading (80) and recycling enterprises (228)
in the settlement were listed.2 As a result of this survey, we developed a comprehensive listing
of all the trading and recycling enterprises in the area. Separate lists were composed, the first
for the trading enterprises and the second for the recycling industries. A random sample was
selected from each list. This allowed us to draw two representative samples; the first for the
trading enterprises and the second sample was representative of the recycling industries.
In 1998, the Association of Garbage Collectors for Community Development (AGCCD)
conducted a survey of all the residential and commercial units in the settlement. This survey
listed the units on each street in the settlement. We used this comprehensive list of all the
garbage enterprises in the settlement to select our sample. The sample for the collection and
recovery enterprises was randomly selected from a list composed of all garbage collectors’
enterprises in the settlement. We randomly selected about 20% of the list that consisted of 786
enterprises. The garbage collectors’ enterprise refers to the garbage collector, the head of the
household, and his family. Collection and transportation of household solid waste is a family
2
Community and Institutional Development, Survey of Micro-enterprise Workshops in Mokattam
Neighborhood, 1996 and updated January 2000.
6

7. business. The head of the family, his wife, children and any of his other dependents all work
with him. The family enterprise constitutes the labor that takes care of the collection and
sorting of household waste on a daily basis.
2.4. Data Collection
The fieldwork was conducted from July 1st – July 31st, 2000. Three teams of interviewers
were trained to conduct face-to-face interviews with the three groups of respondents. Each
team was assigned one of the questionnaires for the three categories of activities in the
settlement. The members of the team of 24 interviewers, were assigned to work on one of the
three questionnaires (one on collection and recovery, the second on trading activities and third
on recycling industries) based on their prior working experience in the settlement as well as
their knowledge of specific activities in collection, recovery, trading and recycling cycles that
take place within the settlement.
2.5. Profile of Respondents
The respondents all reside and work in the Mokattam settlement. They are 176 garbage
collectors and sorters, 55 traders in primary recovered material, and 60 recycling workshop
owners. About 90% of the garbage collectors enterprises surveyed provide direct services to
households around the city. Of this group, the majority of the garbage collectors (61%) work
on collection routes in middle-low income neighborhoods and 39% collect household waste
from high-middle income neighborhoods around the city. They collect and waste from
households to the settlement in Mokattam where they carry out sorting and recovery of
primary materials. The remaining garbage collectors enterprises surveyed (10%) are roamers
i.e. they do not have fixed collection routes but roam the streets of the city in trucks and
donkey carts, and collect garbage that has accumulated on the streets or in empty lots. Only
three enterprises (2%) purchase the waste from other collectors in the neighborhood or private
sector companies and thus only have the sorting and recovery activities.
7

8. 3. Solid Waste Collection and Recovery
The culture-specific aspect about garbage collection in Egypt is that collection systems are
regular only if the collector is someone who profits from the recovery and trade of items in the
garbage. The system costs less to the user (waste generator) if the collector and recoverer are
one and the same, and the system is more environmentally friendly if the collector will benefit
from the recovery of items in the garbage (uncontrolled dumping and burning is reduced to a
minimum). If the collector profits from recovered garbage he will attempt to protect his profit
by collecting directly from his client, i.e. he will want to obtain it from source (door-to-door)
and not from the street. If the privilege of recovery and profit from non-organic materials were
given to someone other than the waste collector, then the latter's input in the system would
have to be his labor in sorting. If he were not willing to provide that input, then it would mean
that he did not see the inherent value of recovering, processing and manufacturing the
recovered items and this would jeopardize the reliability and efficiency of the system. The
latter describes the relationship between the formal waste collection companies that are not
garbage collectors and the waste that they collect3.
The context of poverty in Egypt dictates most of the elements of this system. Importing
equipment, training people to maintain and operate it, is no guarantee of comprehensive solid
waste management systems reform because it neglects the culture-specific dynamics of solid
waste processing and removal in Egypt. Since poverty dictates the system, there will always
be a niche where the city council has to operate - namely the public domain. For it is in that
domain that scavengers operate, and where private collectors will not venture because the
garbage is not 'lucrative' since it comes from low income homes while rich residents are
serviced door-to-door. In tourist destinations in Egypt, the 'rich' residents are the hotels4.
An in-depth understanding of the complex web of relations and interactions, and as
importantly the links between the formal and informal sectors, that constitute the solid waste
management system in Cairo today is essential and critical for introducing change and
meeting the need to develop this system as it stands today. Interventions and innovations
should be considered within this context. The current system of solid waste management in
the city of Cairo is a multi-layered and multi-dimensional process that includes a multitude of
actors and processes. The first in this chain is the average individual living in one of the
residential neighborhoods in the city. Such individuals generate a large amount of waste on a
daily basis. This household waste in then collected by the garbage collectors on a daily basis,
thus providing a vital and indispensable service to the middle and upper class residents of the
city, a service they cannot live without under any circumstances. To date, the informal
garbage collectors are primarily the ones who provide this service, in spite of the growth of
formal private sector collection companies. The efficacy of including the informal garbage
3
Iskander, Laila., (Community and Institutional Development) Municipal Solid Waste Management – Local
Knowledge and National Development: A Case Study from Egypt. Conference Proceedings of the Seventh
International Waste Management and Landfill Symposium, Sardinia, Italy, October 4-8, 1999. 1998.
4
Ibid.
8

9. collectors becomes apparent as we recognize the need to continue providing this service. As
the municipal solid waste system has developed over the years, so have the informal garbage
collectors. They have adapted to the changes in the system over time and have been able to
remain in this business. They have demonstrated this capacity over the years and are expected
to continue doing so in the future. They are a critical link in the chain that have to be taken
into consideration and can have an active role in improving the current system.
The people working in this informal sector have invested large amounts of money, time,
and labor (often unpaid, unrewarded and unrecognized) over the last two decades. The
garbage collectors, traders and recyclers in the settlement have continued to provide a vital
service to the residents of the more affluent neighborhoods of the city unceasingly and without
interruption. More critically, they have invested in their trade over time. They have invested in
building homes in the settlement; in multi-storey permanent structures. They built one room at
a time, one wall at a time. They saved some of the income and whenever they had
accumulated enough savings, they would make another addition to their home, adding the
ceiling and roofs. They spent years to complete the construction of these homes. They also
have invested in their fleet of trucks, meeting the requirements enforced by the municipality,
but also developing the tools of their trade. They also have invested in their workshops,
buying machines for the recycling industries. They have spent considerable time and effort to
develop those links to markets outside the settlement, in both the formal and informal sectors.
The informal garbage collectors form a complex dynamic system for the collection and
handling of solid waste in Cairo. They have expanded the scope and range of their activities in
trading of primary materials and recycling industries. They now have become a large
economic force and a vital part of the national economy. This growing thriving sector has
created hundreds of jobs as well as wage and income earning activities for a multitude of
people in Cairo and elsewhere around the nation. Their linkages with other local and national
markets have made them critical to certain industries. Changes or interventions at any point in
this complex web of activities and trading relations will have repercussions on the whole
system and the flow of products. While it is imperative to improve the living conditions of the
informal settlement and upgrade the trade of garbage collection, we have to recognize the
extent to which they have become integrated into the city life and economy. It is therefore
critical for policy and decisions makers to be fully aware of the extent, intricacy and
complexity of this system. The following diagram charts the different stages and processes
that form the solid waste management system in Cairo.
9

10. Flow Chart 1: Waste Flows as Implemented in the Informal Sector
Collection of Solid Transportation of Manual Sorting
of Organic and Organic Composting
Waste from Solid Waste to
Non-organic Waste Plant or
Households Settlement
Waste Municipal Dump
Non-organic waste
Manual Sorting by Main
Classification of Type of
Primary Materials
Glass Fabric Bones Non-
Paper Plastic recycleables
Metals
Manual Manual Manual
Re-Sorting Manual Re-Sorting Sold to Sold to Municipal
Re-Sorting
by Type & Re-Sorting by Type & Intermediary Intermediary Dumps
by Type
Color by Type Color
Grinding
Preparation Process
Compacted Preparation
Processes
Processes
Sold to Intermediary Traders
Sold to Workshops and Factories
10

11. 3.1. Collection And Transportation
In a sample of 176 garbage collectors, Table 1
158 (90%) of the garbage collectors served Quantity of Waste Collected on a Daily Basis
58100 household units on a daily basis. (In tons)
Each garbage collector enterprise collects
waste from an average of 368 households Number Percentage
every day. Of the garbage collectors
surveyed and who serve households in Under one ton 40 23
residential areas, about 139 garbage Between 1-2 tons 108 62
collectors enterprises (88%) have one Between 3-4 tons 24 13
route and 19 (12%) operate on two routes. Over 4 tons 3 2
Both routes are in residential areas around Total 175 100
the city. A route consists of a specific path
through certain streets in a neighborhood. The garbage collectors pass by the same buildings to
collect the garbage from all the apartments in each of the buildings on this route. The remaining
18 (10%) garbage collectors surveyed in the sample are roamers. The roamers collect about 12
tons of garbage from the streets of the city on a daily basis, i.e. each roamer collects an average
of two thirds of ton of the garbage strewn around the street of Cairo every day. About 50% of
the roamers use donkey carts, and 28% use trucks that have a one-ton capacity while 22% use
trucks that have a three-ton capacity. The garbage collectors surveyed provide services to a
large and growing proportion of the residents of the city. They not only provide the service to
households in specific neighborhoods, but the roamers serve the city in general as they collect
waste that would otherwise accumulate on the sidewalks, streets and any other open space
around the city.
The garbage collectors surveyed work on a total of 173 collection routes in the Greater Cairo
metropolitan area, serving over 58,100 residential units. To work on a route, the garbage
collectors take on the responsibility of making daily rounds to collect garbage from specific
households in the residential areas around the city. They knock on the doors of each household
on this route, hauling away the garbage to the settlement. They collect about 375 tons per day of
household waste. Each garbage collector collects approximately 1.5 kilograms of garbage per
household on a daily basis (375 tons ÷ 58,100 households) thus performing a vital service to
urban residential areas. They work 6.4 days per week, thus collecting about 124,800 tons per
year (6.4 days/wk. x 375 ton/day = 2,400 ton/week x 52 weeks = 124,800 tons/year). They
recover 80% of this tonnage, i.e.124,800 x .80 = 99,840 tons/year, which they trade, prepare as
primary inputs for formal industry and re-manufacture themselves. And herein lies the
formidable importance of this informal sector to the economy – both formal and informal. Not to
mention the critical importance of this particular informal sector to the environment in Egypt
embodied in reducing pressure on landfills, and reducing the amount of uncontrolled burning of
waste in urban centers and mega cities like Cairo.
The majority (94%) operates only one round per day for each collection route. Most of the
garbage collectors (62%) collect between 1-2 tons of household waste per day. Each garbage
collector and his family, who constitute the majority of workers employed in this endeavor, are
responsible for one collection route around the city. On average, each route for the collection of
the solid waste from the residential areas includes about 368 households. In essence, each
household or family of garbage collectors serves about 368 affluent households around the city.
11

12. They collect and transport the garbage produced by these middle class households (about 550
kilograms per day, i.e. at a rate of 550 ÷ 368 = 1.5 ton/household/day). This is accumulated and
dumped in the yard of the garbage collector and his family, where it is sorted and made ready
for the market. This indicates the high capacity of each of the informal sector to handle large
quantities of waste on a daily basis.
The increase in the number of garbage collectors’ enterprises and corresponding increasing
in the number of households served in Cairo over the last thirty years is indicative of the
capacity of this informal sector to grow and expand to meet the increasing demands made on the
solid waste collection system in Cairo during that period. The growth in the population and
housing stock of the Greater Cairo area provide this community with a growing market for their
activities. It has not been demonstrated that the formal sector has grown with the same speed
and responsiveness to the growth of the needs of the city for more efficient waste handling
services. And again, herein lies a critical advantage the informal sector enjoys over the formal
sector: their ability to respond to demand-driven forces faster, and their flexibility in designing
systems that provide customers with market needs.
Figure 1: Growth of Garbage Collectors Enterprises
37
40
35
Percentage Growth
30 25 26
25
20
12
15
10
5
0
Before 1970 1970-1979 1980-1989 1990-2000
Year
The informal garbage collectors have been able to meet these increasing demands for their
services to a significant extent. The services provided by the garbage collectors in the Mokattam
settlement have continued to grow over the last three decades. Prior to 1970, the number of new
garbage collectors’ enterprises established in the informal settlement was limited. While only 24
garbage collectors enterprises were added before 1970, the rate of growth of the number of
collectors and enterprises expanded significantly from 1970 to the present. The results of the
survey indicate that largest increase in the number of newly acquired collection routes (37%)
was during the 1980s. This growth trend continues throughout the 1990s (26%). This is
economic growth at the community level, sector level and national level. It reflects the
establishment of new enterprises, new entrants into the labor force, new trading networks and
new creation of wealth and capital. This investment of capital will be discussed in a subsequent
section, but it is sufficient to note here that if this growth were not profitable, it would not have
12

13. occurred. Therefore it is safe to assume that it reflects an investment that yields a viable rate of
return.
Table 2
Increase in Number of Enterprises and Households Served
Time Frame No of Percentage No of Percentage
Enterprises Households
After 1990 51 26 13537 24
Between 1980-1989 72 37 19773 34
Between 1970-1979 48 25 15877 27
Before 1970 24 12 8700 15
Total 195 100 57887 100
Figure 2
Increase in Enterprises and Households
120
100
Enterprise
Percentage
Household
80
60
40
20
0
After1990 Between Between Before1970 Total
1980-1989 1970-1979
The same trend is evident in the growth of the number of households served within the
Greater Cairo metropolitan area. The results of the survey show that the 1980s ushered in the
largest expansion in the number of households served. About 34 % of the total number of
households added since 1970 occurred during the 1980s, while an increase of 24% took place
from 1991 to the present. This trend is indicative of the expansion capacity of the informal
sector to meet the ever-increasing needs of the burgeoning population of Cairo. It is therefore
imperative to examine how best to provide this sector with credit and to institutionalize their
activities within the framework of national policies in both formal lending sectors, the
environment and local government administration.
Each garbage collector’s enterprise is allocated a certain number of households in the
residential areas around the city. Each collection route consists of a specific number of
households located on certain streets in the residential neighborhoods.
13

14. Figure 3: Growth in the Number of Residential Units
34
35
27
30 24
Percentage Growth
25
20 15
15
10
5
0
Before 1970 1970-1979 1980-1989 1990-2000
Year
Percentage Growth
Approximately 40% serve less than 250 households.
The majority (48%) serves between 250-500 households, i.e. they pass by these
apartments to take away their garbage on a daily basis.
About 8.5% serve between 500-750 households.
Only 3% have more than 500 units on each of their collection routes.
A very small proportion of the garbage collectors surveyed (0.7%) serve up to
1000 households on their collection routes.
The average number of units served by each garbage collector is about 368 households. In
other words, each family within the settlement that comprises a garbage collectors enterprise,
and also a household in their own right, actually serve 368 households in the residential areas
around the city.
Table 3: Number of Units Served
Number Percentage
Less than 250 units 61 39.9
Between 250-500 73 47.7
Between 501-750 units 13 8.5
Between 751-1000 units 5 3.3
Over 1000 units 1 0.7
Total 153 100.0
The garbage collectors in essence perform four main functions: collection, recovery, trade
and recycling. The new formal companies that have been formed by individuals outside the
settlement mostly perform one function only: collection and transportation. The recovery
process is carried out only in the informal settlements of Egypt. Sometimes the formal
companies subcontract with the informal garbage collectors, whereby the former will collect the
solid waste from the households and then proceed to sell it to the garbage collector who will
haul it to the settlement in Mokattam where the recovery process takes place.
14

15. Currently, the informal sector in the Table 4
Mokattam settlement serves two main Type of Neighborhoods Served
categories of neighborhoods in Cairo, (Based on classification of routes)
middle-high income areas and middle-low Number Percentage
income areas. Approximately 61% of High-middle income 68 39
their collection routes are in middle-low Middle-low income 105 61
income neighborhoods and only 39% are
in high-middle income areas. The number of households in each type of varies. About 59% of
the households are in middle-income areas and only 41% are in high-middle income areas.
Most of the households served by the garbage collectors surveyed are in high-middle income
areas. Although only over one third of the collection routes are located in the high-middle
income neighborhoods, they account for the larger number of households that are served. The
garbage collectors respond to market and price mechanisms in the manner in which they select
collection routes and allocate the number of households designated for each route. They tend to
design a smaller number of routes in the higher income areas than the lower income areas. This
is a response to pricing mechanisms. They can sometimes charge higher service fees in the high-
middle income areas. But more essentially, they know they can recover more valuable waste
with potentially greater profits in high income neighborhoods. The ability of the informal sector
to respond to price fluctuations and create market mechanisms to deal with those fluctuations is
demonstrated in the solid waste sector as well as many other informal economy sectors.
Figure 4
Types of Neighborhoods Served
39%
61%
High-Middle Income Middle-Low Income
N i hb h d N i hb h d
In addition, they select routes that have a large number of households thus maximizing the
money, and invariably the waste, they collect on a monthly basis, The middle-low income areas
provide the garbage collectors with different pricing mechanisms. To make the collection and
transportation routes in these areas more viable, they have to add more routes as they charge
lower fees and recover waste of lower market value. The contractual basis for the right to
service Cairene neighborhoods is summarized below:
The contractual basis on which local authorities engage the informal sector operators differs
from the one by which they engage the new private sector companies which have
penetrated the solid waste sector recently. The new companies purchase tender documents,
bid competitively, sign a contract with the Cairo Beautification Authority and get their
contract fee from the same Authority. They are not left open to the risk of some residents
15

16. paying for the fee-for-service and others not doing so. The informal sector operators, on
the other hand, have to pay a deposit ‘insurance’ to the Cairo Beautification Authority up
front, in return for the right to service a specific number of apartment blocks. They have no
guarantee that these blocks are all inhabited, that residents will pay or that they will recover
their cost. Thus they are forced to live off the recovery of recyclables, trade them and re-
manufacture them.
The average monthly service fee Table 5
collected from each household served by the Monthly Service Fee
garbage collectors is L.E.2 per month. This Number Percentage
includes both high-middle and middle-low
income areas. The majority of the garbage Less than 2 pounds 41 25.0
collectors receive between L.E.2-4 per Between 2-4 Pounds 114 69.5
month. The monthly income derived from Over 4 pounds 9 5.5
fees paid by households varies according to Total 164 100.0
the number of households each collector
serves. In addition, the terms of the agreements between the waahi and the garbage collector
determines how much of this monthly fee that latter gets to keep. Profit sharing schemes in the
informal sector are based on historical, traditional and indigenous verbal contractual agreements.
In recent years, formal private collection companies have become licensed to service new
middle-income neighborhoods in Cairo. These concentrate on commercial and institutional
waste generators and informally sell the waste they collect to the garbage collectors who recycle
it5. This saves the private collection companies the extra cost of transporting the waste to the
outlying municipal dump. Most of the private collection companies do not have the capacity to
carry out the sorting and recovery processes that are undertaken in the yards of the households of
the garbage collectors in the informal settlements. Selling the garbage they collect from
households and residential units to the garbage collectors allows these companies to profit from
the hauling business. As the garbage itself has little value to the formal private companies, they
save on the costs of disposal by selling it to the garbage collectors, who haul it the extra distance
to their homes for sorting and recovery. What is perceived as unprofitable in the formal sector
economy is perceived as valuable by the informal sector.
3.2. Recovery of Primary Materials
Solid waste recovery and re-use in Egypt is based on the single most important motive for
such behavior: economic motivation. Be it the garbage collectors of Cairo, or the residents of
cities, towns and villages all over the nation bartering their non-organic waste, the strong driving
force behind the recovery and re-use is the financial incentive. It follows, therefore that any plan
to recover uncollected municipal waste, need only devise schemes that will compensate people
for the recovery of that item. Most of the income generated by the garbage collectors is from the
sale of primary materials that are recovered from the garbage, such as paper, plastics, rags, metal
5
Assaad, Marie and Moharram, Ayman. The Role of NGO's in Solid Waste Management. Cairo, 1994.
16

17. and glass. These are discarded by residential units around the city but can be re-used for other
purposes either through sale or manufacturing6.
Another critical aspect of informal sector activity, be it in the waste sector or other sectors, is
that it is essentially a family business. Each and every member of the family is involved in this
business either as a truck driver, a collector or a sorter. Most critically, the women and girls in
the family are the sorters. They are the ones, who amidst their daily household chores of
washing, cleaning and cooking, manually sort the garbage that is deposited in their yards. They
do this on a daily basis.
In this connection, we propose that a closer look be taken at source separation of waste to
address the efficiency of the recovery process as well as the health hazards that hundreds of
women and girls are exposed to in their daily chores. During the sorting process, the garbage is
sorted into its organic and non-organic components. The organic waste is fed to the animals,
sold to other breeders in the settlement or sent to composting plants and municipal dumps.
However, animal breeding has dropped significantly over the last two decades and is
continuously on the decline. The spread of composting plants offers other options to dispose of
the organic waste.
The high rate of recycling in Egypt is a function of the intensive and multi-layered sorting
process that takes place in the informal settlements where the garbage collectors are located. The
intricate, detailed and sophisticated system of classification of the recovered primary materials
that the informal sector has developed over time allows them to re-use up to 80% of the
municipal solid waste. This system of classification has evolved over time and is constantly
being revised and refined as the technology in the recycling industries has developed. Over the
last two decades, an increasing number of usages have evolved for more and more of the
primary materials. As such needs arise and the appropriate technology is adopted, both in the
informal and formal sectors, the garbage collectors have been able to come up with the
appropriate differentiation of the main primary materials by type, size, usage, texture, color. The
non-organic waste is then sorted into different categories of materials, primarily plastics, paper,
glass, metal, fabric, bones and non-recyclables. Another sorting process is then undertaken to
sort the different sub-types of each of the main categories of materials. Sorting is done according
to color, size, shape and potential use or re-use of the materials. These re-sorted and reclassified
materials are then sold to intermediary traders. These traders will in turn either sort or process
these materials so that they can sell them to other customers for resale or manufacturing
purposes. The primary recovered materials are sold in formal and informal markets and to large
industrial plants throughout the country. The recovery process is the crux of the efficiency of
recycling of solid waste. It should, at the very least, be maintained, but also enhanced as we
improve the design of solid waste management systems in the city in general. Materials that
cannot be recycled or resold are hauled to the municipal dumps. The efficiency of sorting and
recovery reduces the amount which ends up in controlled dumps and sanitary landfills.
Approximately 85% of the solid waste collected by the informal garbage collectors is
recycled while only 15% is considered unusable “rabbish” i.e. residual waste. The women and
6
Iskandar, Laila. (Community and Institutional Development, C.I.D.)Waste Management, The Case of the Cairo
Municipality: The Informal Sector Recycling Program. Workshop Proceedings on Cost Recovery and
Public/Private Partnerships, General Assembly of MEDCITIES Network; Rome, December 1998.
17

18. girls in the settlement sort the garbage on a daily basis into 16 different categories of material
depending on the type, usage and method of recovery. See Table 6 for the listing and volume
recovered for each kind of recovered material. All the recovered primary materials are sold to
intermediary traders in the settlement or traders located in other informal and formal markets
around the Greater Cairo area and throughout the nation.
Table 6
Primary Recovered Material
Type Volume Percentage
Per Week
Iron 1.2 0.05
Nylon Bags 3.3 0.13
Copper 3 0.13
Soft plastic 6.6 0.3
Animal Bones 6.6 0.3
Aluminum 8.8 0.4
Transparent Plastic 16.5 0.7
Cloth 23 1.0
Broken Glass 27 1.1
Paper 36 1.5
Tin 95 3.9
Cardboard 99 4.1
Rabbish 366 15.3
Nakdah7 477 20.0
Organic Waste 478 20.0
Glass 753 31.3
Total 2400 100
Trucks are used to transport the non-recyclables to municipal landfills on a monthly basis.
The majority (61%) use the trucks provided by the Association of Garbage Collectors for
Community Development (a local non-profit organization located in Mokattam) for that specific
purpose. Only 6% use rental trucks and the rest (33%) use their own trucks to haul these
materials to the municipal dumps. The average cost for each time they transport one truck-load
of “rabbish” to the landfills is L.E.30. On average, the garbage collectors have to clear their
workspace about 6 times per month, bringing the average annual cost of disposing of the non-
recyclables L.E.2,160. This expense constitutes a cost that Cairenes pass on to the garbage
collectors, as it is not covered by the monthly service fee that the residents pay. Thus, in essence
the informal sector subsidizes the formal sector i.e. the poor subsidize the rich. The cost is even
more exorbitant to the informal sector when health hazards, lack of industrial safety and
disabilities are calculated in the cost of collection and recovery.
7
Nakdah consists of wide variety of items that do not have specific uses for recycling. This category includes
articles such as toys, vases, artificial flowers, spoons, forks, and miscellaneous objects run by small motors.
18

19. Figure 5
Means of Transportation of Non- Recyclables Municipal Dumps
6%
Association Truck
33% 61%
Private Truck
Rental Truck
Based on the results of our survey of the sorting process, the garbage collectors report that
about 20% of the total garbage they collect is organic waste. This organic waste is either fed to
the animals (for the minority who are still raising pigs), sent to the composting plant or to
municipal dumps (if and when these are available). The organic waste residual waste is removed
from the workspace four times per year. It is either transported to composting plants or to
farmers in the Delta. The average annual cost of that activity is LE.1, 620.
Each of the primary recovered materials is handling according to its potential uses8.
Plastic: The most commonly recycled item in garbage, it includes food containers, mineral
water bottles, black garbage bags, medicine bottles, etc. Each is sorted by type and color. The
intermediary or informal traders specialize in handling the different kinds of plastic. Thus one
trader will specialize in mineral water bottles, another in food containers, a third in trash bags,
etc.
a. Food containers, oil containers and household items: These are cut in half manually
using a big pair of industrial-size scissors, sorted by color, washed in boiling water and potash in
a huge tub with a burning furnace underneath, left to dry then put through the funnel top of the
plastic crusher and packed in sacks awaiting sale to merchants who act as middlemen between
the plastic crushers and the manufacturers. Manufacturing of plastic takes place in the garbage
neighborhood as well. These microentrepreneurs evolved a few years after the inauguration of
the first credit scheme and were largely self start-up small businesses using locally designed and
manufactured technology available in the informal sector of the economy in Egypt. Start up
capital came either from the sale of the wife's gold earrings, a piece of furniture, a T.V. set,
credit from loan sharks or the sale of a small plot of land still owned back home in the home
village in Assuit.
8
Iskandar, Laila. Mokattam Garbage Village. Cairo, Egypt. Printed by Stallion Graphics, Heliopolis, Cairo, 1994
19

20. b. Black Plastic Bags: These are washed manually in a big container with soap and
water, left to dry on a clothes line and put through a plastic crushing machine which transforms
them into beads. These are in turn re-manufactured into black shopping bags or trash bags.
c. Mineral Water Bottles: The lid and label are peeled by the women in the family, then
the bottle is cut into half using manual industrial-size scissors, then crushed using the same
process followed by the food container plastic crushers except for the separation by color since
mineral water bottles all come in the same clear blue color.
Animal Bones: Animal bones are collected and sold to middlemen who re-sell them for fodder
and to glue manufacturers.
Glass: This component continues to be sold to manufacturers outside of the community but the
community does produce a handful of glass middlemen who would buy from garbage collectors
who went out on the garbage route and sorted the glass into according to type, size and color.
Intermediary traders specialize in handling these different types such as medicine bottles, beer
bottles, etc.
The following flow charts illustrate the complex and extended web of relationships
among the informal sector operators in the field of waste and between them and the formal
sector of the economy. A close look at that flow indicates the inextricable links between the two
economies – formal and informal. It becomes apparent that a dis- equilibrium in one link in the
chain can potentially disturb the entire chain. Backward and forward linkages between the
formal and informal economies are critical factors to examine by policy makers, formal lending
institutions, economists and market analysts.
20

21. Flow Chart 2
The Product Flow for Glass and Paper
GLASS PAPER
Sorted Sorted
Into Into
Thick Office
Broken Whole Paper Paper
Glass Glass
Sold to Sold to
Sold to Internal Sold to Internal &
Intermediaries External Intermediaries
Compression
Sorted by Sorted by Informal Workshops in
Color Type Traders & Settlement
Wholesalers
Sold to Large Scale Sold in Other Formal Formal Sector
Formal Sector & Informal Markets Factories in
Industrial Plants Across the Nation 10th Ramadan
21

22. Flow Chart 3
Product Flow for a Plastics Sub-Type --- Hard Plastic
Hard Plastic
Manually
Sorted by
type/texture
Sold to Manually
Intermediary Sorted by color
Traders
Sold to
Intermediary Washing
Traders
Sold to
Intermediary Crushing
Traders
Sold to Formal &
Informal Traders Granulating
and
Manufacturers
Sold to Formal &
Pelletizing
Informal Traders
and
Manufacturers
Sold to Sold to Formal
Intermediary Industry for
Traders Manufacturing
22

23. 3.3. Contractual Agreements for Collection and Transportation
The relationship between the wahiya and the garbage collectors was, and in some cases still is,
an informal contractual agreement. They had traditionally cooperated to provide their services to
households around the city when the system had no or limited government regulation. As the
municipal system of solid waste started to change during the late 1980s and into the 1990s, the
relationship between the wahiya and the garbage collectors also underwent some changes.
During the 1980s, the Cairo Cleansing and Beautification Authority (CCBA) was created to
regulate the solid waste management system in the city through the creation of licenses for the
collection and removal of waste. Only private, registered companies were considered eligible to
bid for such licenses. This prompted the waahis and the garbage collectors to form private
companies with the assistance of the consultants firm Environmental Quality International. The
waahis continue to have the responsibility of organizing the work on the collection routes and the
garbage collectors provide their labor in exchange for the garbage, which generates most of their
income. The majority of the waahis and garbage collectors have formed companies that can bid
for, and be granted, licenses from the CCBA. Most of these companies are owned by the waahis9.
The companies build on the arrangements that had existed between the waahis and the garbage
collectors. However it has enabled them to continue working in this trade as they now meet the
licensing requirements of the CCBA, while hauling the garbage continues to be worked out
between the waahis and the garbage collectors. The companies pay the licensing fees to CCBA and
collect the service fees from the households. Partnerships, mergers and contractual agreements
regulate, in an informal but equally binding manner, informal sector activity.
The pattern of relations between the garbage collector and the wahi has changed from the
traditional arrangement where the waahi only has the right to the service fee. During the early
1990s, the CCBA started to grant licenses to private companies that are owned by both the waahis
and the garbage collectors. These companies were registered in order to meet the new licensing
requirements enforced by CCBA. These companies allow the wahiya and garbage collectors to
participate in the CCBA bidding process. Some of these companies are jointly owned by both the
wahiya and the garbage collectors, other are owned by the garbage collectors alone, but the wahiya
independently own the larger proportion of such companies. The institutional and contractual
arrangements between the wahiya and the garbage collectors have changed over time. This yet
again demonstrates the ability of the garbage collectors to adapt to new changes in the market and
the regulation of their trade. As they operate in the informal sector, they have capitalized on the
adaptability and flexibility that is particular to that sector in general to reach agreements that serve
their purposes.
Depending on who actually collects the user fees from the household, the garbage collector and
the waahi share the proceeds. The only standard feature of this system is that when the waahi
collects the service fees from the households, he pays the garbage collector a certain amount of
money every month. When the garbage collector collects the service fees from the residential units,
he in turn pays the waahi a specified amount of money every month. The amount paid by the
waahi to the garbage collector or the garbage collector to the waahi varies according to the nature
9
Environmental Quality International, The Zabbaleen Environmental And Development Program: An Evaluation,
Cairo, 1997.
23

24. of the agreement between the waahi and the garbage collector. The amount of money that is paid
by one party to the other is determined by the nature of the relationship between the two parties.
Agreements to share the service fees are informed by a number of factors;
The proportion of the hauling costs that each party to the agreement will share
The proportion of the cost of the vehicle that each party will pay, if the wahi has helped
the garbage collector to acquire the trucks
Who provides the labor for the collection of the garbage from the households
Who provides the labor for the transportation of the garbage from the residential
neighborhoods to the settlement
The terms of these agreements are made between each waahi and garbage collector
individually. There is no standard form for these agreements but there are multiple formulae for
such agreements. Agreements are reached based on the historical relationship between any
particular waahi and the garbage collectors he deals with. In addition, as the system for collection
and transportation changed over time, so have the factors that have informed such agreements.
The average monthly payment from the Table 7
garbage collector to the waahi is Responsibility for Fee Collection from
approximately L.E.140 per month. The Households
garbage collector pays a fee to the waahi Number Percentage
who has the concession to collect the Waahi 87 50
garbage from the households. By Garbage Collector 49 29
participating in the licensing and bidding Both 32 19
processes implemented by CCBA, the
wahiya and the garbage collectors can be granted license to collect the garbage from
neighborhoods around the city. The licensing fee paid to the CCBA secures the right of the
garbage collector to get the garbage from those residential units. Based on who actually collects
the service fees from the residential units, payments are exchanged between the waahi and the
garbage collector. The minimum payment made by the garbage collector to the waahi is LE50 per
month when the fomer collects the fees from the households. The maximum payments is L.E.400
per month. On the other hand, the waahi pays the garbage collector an average of L.E.110 per
month, when the former collects the fees from the households. The minimum payment made by the
waahi to the garbage collector is L.E.10 per month and the maximum is L.E.350 per month. This
dual pattern of payment between wahiya and garbage collectors is a function of several factors.
One of these factors is historical arrangement between each party. The fees paid by the waahi and
garbage collector are based on the informal positions of financial power between the wahiya and
the garbage collectors. Traditionally, only the wahiya had the right to collect the service fees,
while the garbage collectors lived off what they could make from the garbage itself. With the
changes in the current system, some of the garbage collectors have recently acquired the right to
collect the service fees. This has resulted in new patterns between the wahiya and the garbage
collectors. The critical factor in this relationship is who has won the concession for the right to the
collection routes. These concessions are awarded through binding processes conducted by the local
municipal authorities. These individuals, in turn, tend to have more power over setting the formula
for sharing the service fees collected between the wahiya and garbage collectors. The second factor
is the provision of labor for the physical collection and transportation of the garbage. The garbage
collectors generally provide the labor and most of their income is generated from the sale of the
primary materials. The wahiya still appear to have a stronger bargaining position vis-à-vis the
24

25. garbage collectors and appear to receive the larger proportion of the income generated from the
service fees.
The amount of payment from waahi to garbage collector and vice versa is determined by:
Size and magnitude of the market (the number of households served)
Income levels (the service fees collected from each household)
Links between customers and service providers (who collects the fees)
Labor (who collects the waste from each household)
In some cases, the waahi uses his own workers (individuals that he pays directly and are not
accounted for among the solid waste workers i.e. they are not accounted for in this survey) to
collect the solid waste from the households and accumulate it at a specific location outside the
building. The garbage collector then hauls it from that spot to the settlement in Mokattam. In
others, the garbage collector is responsible for collection of the waste from the households and
transportation to the settlement in Mokattem. Both the garbage collectors and the wahiya have the
right to the service fee. In some cases, the garbage collectors collect the fee from the residential
units. In such cases, the garbage collectors have to pay an agreed upon amount to the waahi. If the
waahi collects the service fee from the residential units, then he has to pay the garbage collectors
operating on those routes a certain proportion of the fees collected. The amount paid by one party
to the other is agreed upon between them prior to working on the collection routes. The changes in
the regulation of the municipal solid waste management system made by the municipal authority
over the last two decades have resulted in some changes to the nature of the traditionally informal
and verbal contractual agreement between the wahiya and the garbage collectors.
Table 8
Monthly Payments made by Wahiya and Garbage Collectors
Payments Made By Waahi Payment Made by Collector
To Garbage Collector To Waahi
Number Percentage Percentage Number
Less than L.E.100 per month 15 36 31 44
Between L.E.100-200 per month 16 38 31 44
Over L.E.200 per month 11 26 9 12
25

26. 4. Trading Enterprises
Trading and manufacturing networks have grown to cover the whole country from Alexandria
to Aswan. The industry has spawned its own dealers, its own centers of production and recycling,
and its own business culture of credit, trade and finance. A thriving informal sector which
recovers, trades in, processes and re-manufactures plastic, scrap metal, paper, cardboard and
bones10.
After garbage collectors sort the primary materials are sorted into the main primary materials
and then sorted again into the sub-categories of these materials, the garbage collectors sell these
materials to intermediary traders. Some of these traders are based in the settlement while others
come from different parts of the city as well as country. Most of these traders are part of the
informal sector, but a significant number of formal sector traders are increasingly attracted to this
large and lucrative market. The intermediary traders will mostly buy the bulk of the materials
accumulated by the garbage collectors on a weekly basis. The informal traders in the settlement
generally specialize in one type of material such as glass or plastic. In some cases, they are even
more specialized as they focus on certain sub-categories of these materials such as plastic water
bottles for re-use or crushed plastic containers for recycling. The traders who are based in the
settlement store these materials in warehouses scattered around the area. On average, it takes
about a week for them to accumulate quantities that are large enough to sell to their customers.
These customers are mainly traders from other markets around the country, and in some cases
large manufacturing plants. They have developed a large network of customers who rely on their
proven ability to deliver the required materials on a regular basis. More often than not, the
agreements made between these trading partners are verbal agreements to which they all adhere.
In general, there is a demonstrable inclination toward specializing in one or the other kind of
recovered material. The most crucial factor in decisions about organizing this work and making
tangible profits is the sorting activity. The sorting activity requires space and technical expertise.
This is supported by the results of the survey that demonstrate that there is a high degree of
specialization in the trade of recovered materials among the micro enterprise traders in the
settlement. Of the 55 traders surveyed, approximately 37 traders (67%) specialize in only one type
of recovered material such as rags, 14 traders (25%) trade in two types of recovered material e.g.
colored glass and whole glass and only 4 traders (7%) trade in three types of material, mostly
different kinds of plastics based on color and reuse. There are seven main categories of primary
recovered materials in which the intermediary traders in the settlement deal in; glass, plastics,
paper, metals, rags, bones and nakdah. Most of these categories are composed of several
components, for example:
10
Iskandar, Laila. (Community and Institutional Development). The Informal Sector: A Dynamic Force in Municipal
Solid Waste Management. Workshop Proceedings of the Friends of the Environment Association (FEDA), Earth Day
Meeting, Cairo, 1997.
26

27. Glass: broken pieces of glass and whole pieces of glass, then sorted by color and then
according to whether they can be refilled.
Paper: sorted into thick heavy paper referred to as carton and other paper such as office
paper and computer printouts.
Plastic: divided into whole pieces and broken pieces, then sorted by color, type, shape,
e.g. HDPE, LDPE, PET, …
Most of the intermediary traders surveyed Table 9
worked in plastic (30%) and paper (29%) trading. Distribution of Trading Activities
Metal traders in general, such as tin, aluminum Type of Material Number Percentage
and copper accounted for 22% of the traders Plastic 17 30
surveyed. This concentration on these materials Paper 16 29
reflects two main factors, (1) the amount of these Glass 5 9
materials that is recovered from the garbage (See Tin 11 20
Table 6 Primary Recovered Material), and (2) the Aluminum 1 2
expansion in the recycling industries that are Rags 4 8
based on these materials (See Table 13 Growth in Animal Bones 1 2
Recycling Industries).
4.1. Trading networks
Most of these traders have arrangements with the garbage collectors to purchase specific kinds
of materials. On average, each trader contracts with 26 suppliers who are mostly located in the
settlement and in other areas around the
city. The majority of these traders Table 10
(40%) have up to 25 suppliers from Suppliers to Intermediary Traders
within the community and only 9% Number Percentage
have over 50 suppliers. These Less than 25 suppliers 40 73
intermediary traders contract, on an Between 26-50 suppliers 10 18
informal basis without written Over 50 suppliers 5 9
agreements, to purchase certain types of recovered primary materials from the garbage collectors.
They generally make daily rounds to haul these materials to their storage locations within the
settlement, as the garbage collectors do not have enough space to accumulate up to 16 types of
recovered materials for one week. The intermediary traders, in turn, accumulate the recovered
material and sell larger quantities to their buyers on a weekly basis. Ownership of warehouse space
counts as an asset for enterprises in trading in the informal sector. It is uncounted capital but still
capital without title which cannot be used as collateral vis a vis formal lending institutions.
On the other hand, the majority of
these traders (84%) have one or two Table 11
customers to whom they sell Customers of Intermediary Traders
accumulated volumes of the Number Percentage
merchandise. Most of their customers One buyer 22 40
are either recycling workshops in the Two buyers 24 44
settlement or large traders from More than two buyers 9 16
outside the community or large-scale plants and factories in industrial areas such as 10th of
Ramadan and 6th of October Cities. Approximately 58% of the customers of the intermediary
27

28. traders are located outside the settlement and are spread throughout the country. The intermediary
traders in the settlement have been able to develop extensive links with the national economy,
trading with partners as far south as Sohag. The spread and outreach of the informal economy
reverberates across trading networks nationally.
4.2. Complementary Activities
In addition to collection and storage,
other complementary activities are Table 12
undertaken during this process of trading in Supplementary Activities to Trade
primary recovered materials. In most cases, Number Percentage
the intermediary informal trader in the Sorting 46 84
settlement will collect certain kinds of Preparing 13 24
materials only such as glass, plastic, tin, Compressing 5 10
copper, since most of these traders specialize in only one kind of material. These materials are
sorted according to type and color, either on the premises of the garbage collector or in the
warehouse in the settlement. Different arrangements are made depending on the volume of the
primary material. In some cases, these workers throw out some material that they consider not
appropriate for re-sale. For example, this happens with certain types of metals that are considered
too small or copper wires still covered with plastic or whole glass are sorted according to color,
then according to type and size. The intermediaries will then sell each of these types to traders
from outside the settlement whom specialize in certain types of glass only. A similar process takes
place with paper. It is sorted according to type, e.g. newspapers, office paper, computer paper and
thick paper. Each type is then compressed separately and sold to specialized traders or large scale
manufacturing plants. This process is also carried out for plastic, where is it sorted according type,
size and color. Each type is processed separately and sold as cut pieces of plastic or as washed,
palletized or granulated plastic. This high degree of specialization is coupled with the flexibility of
the informal sector. Market differentiation dictates the need for such sophisticated sorting activity
and therefore the informal sector is highly responsive to market demands.
28

29. 5. Small Scale Recycling Industries
Recycling industries in Egypt have expanded, diversified and increased in number over the last
15 years. The 1980s ushered in a move towards investing in recycling workshops in the Mokattam
settlement. Initiatives to start such endeavors were supported by external funding and technical
assistance. After that first phase, the establishment of recycling industries has gained momentum
and expanded to be the second largest employment generator in the informal settlement. These
recycling workshops rely on the primary material sorted by the garbage collectors and sold through
intermediaries. They are their raw materials from the settlement. They also rely on the inhabitants
in the informal settlement for their labor. However, these recycling workshops have also become a
magnet for youth from other parts of the city. The recycling workshops employ the largest number
of workers from other communities. Some of these workers commute to the settlement on a daily
basis, while others have relocated and now live in the settlement. The size, scope and activities of
the recycling workshops vary. Some specialize in a particular step of the recycling process, having
invested in only one machine. Others have larger investments and undertake a multi-step process
in the recycling of certain types of primary materials. The recycling workshops produce both final
products and intermediary products. Their clients are located throughout the country, seeking the
output. The final products are destined to end up in the markets around the city. The intermediary
products are sold to larger workshops and often to large-scale industrial plants in and around Cairo
as well as those around the country, such as the 6th of October, the 10th of Ramadan, Alexandria,
and Suez.
5.1. Type and Growth of Recycling Industries
The growth in depth and breadth of recycling industries in the informal sector has soared over
the last few years. From 1996 to 2000, the number of workshops in the settlement increased by
approximately 29% during these four years. The largest increase was in the cutting tin and
pelletizing workshops, while the number of washing and sorting plastic workshops fell by about
25%. Some of the workshops have expanded to include more than one step in the plastic recycling
process. In July 2000, there were 228 micro and small scale recycling enterprises in the Mokattam
settlement that employed 1435 individuals from various communities. In 1996, there were 163
workshops that employed 1002 workers. The recycling workshops in the area created
approximately 30% new job opportunities during this four-year period. The total invested capital in
these enterprises was L.E.3,080,650, of which and equipment cost was L.E.1,805,350 was
allocated to the acquisition of equipment. The average amount of capital invested in recycling
workshops was L.E.13,800 of which L.E.7700 (56%) was allocated to cover the cost of
equipment. The average number of workers employed in each of these workshops is 6 individuals.
The largest number employed was 20 workers.11
29

30. Figure 6
Growth of Recycling Enterprises
1996-2000
Percentage 140
Growth 100
Number of 228
Enterprises 163
0 50 100 150 200 250
1996 2000
Table 13
Growth in Recycling Industries12
Type Number in Number in Percentage
1996 2000 Growth
Plastic Crushing Machines 44 65 32
Washing & Sorting Plastic 8 6 -25
Plastic Granulation 6 15 60
Cloth Grinders 16 17 6
Paper Compacting Machines 15 19 21
Cutting Tin 11 29 62
Washing Tin 2 2 0
Pellletizing Machines 6 11 45
Other Plastics 8 7 -13
Injection Mold 27 44 39
Aluminum Smelters 20 13 -35
Total 163 228 29
With the advent of paper compactors, also part of the micro enterprise scheme, assembling
little bits of paper and packing them into large, square bales of paper gave birth to a new category
of product for traders and recyclers. Paper is compacted and sold to traders and manufacturing
plants in the formal sector. Examples of recycling manufacturers of plastics are those who produce
clothes hangers, pitchers, ice cream spoons, lollipop sticks, and the like. A thriving market for
12
Based on a Community and Institutional Development survey conducted in the Mokattem settlement in January
1996 and updated in January 2000.
30

31. such products exists in low income neighborhoods in Egypt and is actually very active in its
trading outlets in the south (Upper Egypt)13.
The micro enterprise credit scheme began in 1986 introduced cloth grinding machines which
consist of two cogs moving anti-clockwise and crush the cloth into cotton stuffing for mattresses
and pillows and the like. These machines are powered by electric power that is becoming more
and more costly every year, especially in view of structural adjustment programs. The crushed
cloth makes its way to low income, informal markets and does not conform to high quality control
or hygiene standards.
A couple of years into the recycling experience, locally designed aluminum smelters began
dotting the neighborhood. These were not even purchased from outside the neighborhood. Rather,
they were designed, manufactured and installed manually by the entrepreneur himself and required
negligible start-up capital since they simply involved a deep furnace powered by diesel fuel, a few
antediluvian tools to poke the aluminum down into the bottom of the furnace, and a giant size ladle
to pour the molten aluminum into square molds locked into place with a single hole at the top to
receive the molten aluminum. After allowing this product to set, the mold would be opened up
into two parts, with one falling back as a flap and the solidified aluminum rectangle would be
picked up using metal tweezers and placed in piles, then rows of piles to cool down. This
technology was home grown and the implements were very basic. Dark smoke emitted from a
pipe attached to the furnace and it would have been too much to expect people engaged in the
survival game of recycling to design a system that would reduce or remove these emissions. Thus
there is a pressing need to provide technical support and credit to allow these entrepreneurs to
develop and adopt appropriate technology, avoiding negative side effects.
The same ubiquitous, industrial size scissors appeared here again in recycling tin, to separate
the tops of aerosol cans from the can. The can part was flattened using a heavy, handmade flat
hammer and the flattened tin was tied up in bunches of fifties and hundreds in anticipation of tin
middlemen. Those who bought the flattened tin used another indigenous technology to clean it and
process it for manufacturing. That technology involved a barrel filled with boiling water and
potash, sitting on top of a small furnace. The washed tin would then be placed in a drum into
which holes had been pierced and mixed with ash to ensure the thorough elimination of rust and
dirt from the recycled tin. That drum was hooked to an electrical power source and rotated as soon
as the switch was turned on. Bits of rust, dust, dirt and ash would fall out of the holes in the
rotating drum and onto the ground below the drum. The end product -- clean round, oval, square,
rectangle pieces of tin - would be sold to manufacturers who used it to make paint cans and a
number of other items14.
5.2. Trading Networks: Suppliers and Customers
13
Iskandar, Laila. (Community and Institutional Development, C.I.D.)Waste Management, The Case of the Cairo
Municipality: The Informal Sector Recycling Program. Workshop Proceedings on Cost Recovery and Public/Private
Partnerships, General Assembly of MEDCITIES Network; Rome, December 1998.
14
Ibid.
31

32. The micro enterprise and small scale recycling workshops in the settlement predominantly rely
on the informal network of garbage collectors and intermediary traders within the settlement to
purchase their raw materials. The Table 14
recycling workshops have on average Suppliers of Raw Materials
three suppliers each. In this case,
Number Percentage
suppliers are those individuals who
Garbage Collector 8 13
provide the workshops with the
Internal Trader 14 24
necessary inputs. The owner of the
External Trader 8 13
workshop contracts, on an informal
Multiple Sources 30 50
basis, with the garbage collectors
(usually three) who will provide him with the raw material needed for his workshop. These
agreements are usually verbal and informal but explicitly define the roles of each; the garbage
collector is the supplier of the raw materials and the owner of the workshop is the purchaser. The
price and quantity provided are agreed upon and the commitment of each party is clearly
understood. This implies that the 55 trading enterprises surveyed reflect the involvement of 165
other individual garbage collectors in weekly transactions in this informal market.
The size and volume of this market is central to the high percentage of recovery and
recycling of solid waste in Cairo. The web of transactions allows for the re-sale and re-use of
about 80% of the municipal solid waste. These transactions cut across the boundaries of the
settlement as well as the formal and informal markets. They link traders and producers throughout
the nation. Only 13% of the workshops rely exclusively on suppliers from other informal and
formal markets outside the settlement. About 50% use multiple sources in order to buy their
inputs, using both sources within the settlement and around the country. These workshops form
linkages to the national economy, both in the informal and formal sectors. They have transactions
with other traders from all over the nation and deal with a sizeable market and volume of trade.
The impact of any changes to the current waste handling system of Cairo will have resounding
effects that will reverberate in markets throughout the nation.
Table 15
Customers: Buyers of Primary Materials (M)
Number Percentage
Trader in Settlement 15 25
External Trader 19 32
Workshops 4 7
Factories 8 13
Multiple Outlets 14 23
32