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The informal sector in waste recycling in egypt2


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  • 1. THE INFORMAL SECTOR IN WASTE RECYCLING IN EGYPT Report Submitted to GTZ MAY 2008 Submitted to GTZ by
  • 2. Table of ContenetsABBREVIATIONS ............................................................................................................................ 4GLOSSARY OF EGYPTIAN TERMS .................................................................................................... 5INTRODUCTION ............................................................................................................................ 6METHODOLOGY ............................................................................................................................ 6Chapter 1: Historical Descriptive Narrative of Egypt’s SWM Situation ............................................ 8 1.1 Actors in the Informal Recycling Economy ........................................................................... 8 1.1.1 The Traditional Waste Collectors (Zabbaleen) ........................................................... 8 1.1.2 Roamers (Sarriiha).................................................................................................. 10 1.1.3 Robabekia and Saxonia Peddlers ............................................................................ 10 1.1.4 Middlemen and Intermediary Buyers/Dealers ......................................................... 10 1.1.5 Wholesale Merchants of Recoverable from Roamers ............................................... 10 1.2 Formal Actors in the Solid Waste System .................................................................... 11 1.2.1 Local Level Government ...................................................................................... 11 1.2.2 Ministries.............................................................................................................. 11 1.2.3 The Formal Private Sector....................................................................................... 13 1.2.4 Donors and Private Supporters ............................................................................... 14 1.2.5 Residents and Commercial Waste Generators ........................................................ 15 1.3 Adaptive Strategies of the Informal Recycling Sector ..................................................... 15Chapter 2: Overview of the Institutional Framework of Informal Waste Workers .......................... 17 2.1 Informality of Shelter is linked to Informality of Livelihood ................................................ 18 2.2 ..... Business Aspects of Informality: International Contracting Threatens a Dynamic Recycling Sector ..................................................................................................................................... 20 2.2.1 Response to Markets.............................................................................................. 20 2.2.3 Ownership of Land, Sorting Space and other Assets ............................................... 20 2.2.4 Capital ................................................................................................................... 21 2.2.5 Labor and Wages ................................................................................................... 21 2.2.6 Growth in Recycling Enterprises ............................................................................. 21 2.2.7 Trading Networks .................................................................................................. 21 2.2.8 Specialized Trading Towns and Centers ................................................................. 22 2.3 Informal Sector Recyclers: Private Business Partners to Large Industry ........................... 22 2.3.1 Livelihoods, Income and Employment..................................................................... 23 2.3.2 Exploitation of Household Waste Collectors by Middlemen ..................................... 24The Informal Sector in Waste Recycling in Egypt 1
  • 3. 2.3.3 Competition for the Waste by Scavengers ............................................................... 24 2.3.4 Residents’ Displeasure ........................................................................................... 24 2.3.5 Resettlement Issues ............................................................................................... 24 2.4 Challenges Faced by Informal Sector Recyclers .............................................................. 25 2.4.1 Poor Ability to Organize ..................................................................................... 25 2.4.2 Lack of Transparency of the System ...................................................................... 25 2.4.3 Financial Constraints ............................................................................................ 26 2.4.4 Legal and Contractual Obstacles .......................................................................... 26 2.4.5 Social Issues Related to Stigma of Trade and Perception of Society at Large ................ 26 2.4.6 Need for Skills Upgrading – Training ..................................................................... 26 2.4.7 Operational Issues ................................................................................................ 26 2.4.8 Informality ............................................................................................................ 27 2.4.9 Difficulty in Acquiring and Asserting Ownership of Property ................................... 27 2.4.10 Inadequate Market Information and Market Intelligence ......................................... 27 2.5 Non-Profit Community Groups ..................................................................................... 27 2.5.1. Association of Garbage Collectors for Community Development (AGCCD) .................. 27 2.5.2. Association for the Protection of the Environment (APE)............................................. 28 2.5.3 Spirit of Youth for Environmental Services (SoY).......................................................... 28 2.6 Lessons Learned from the Various Institutional Actors ...................................................... 28 2.6.1 Lesson One: Recycling of Source Segregated Waste Dignifies the Trade and Generates Income ............................................................................................................... 28 2.6.2 Lesson Two: Source Segregation of Household Waste into Two Fractions (Organic and Non Organic) is Feasible ............................................................................................... 29 2.6.3 Lesson Three: The Regularity of Service and Efficiency in Recovery are Based on Inherent Incentives to Collectors Who are Recyclers: ............................................................ 32 2.6.4 Lesson Four: Motivated by Profit and armed with Market Information the Informal Sector Recovers High Levels of Industrial Waste all over Egypt ............................................. 33 2.6.5 Lesson Five: It is Possible to Institutionalize Informal Sector Models of Clean Recovery and Recycling of Institutional Waste .................................................................................... 34 2.6.6 Lesson Six: Informal Sector and Formal Private Sector Interests Converge around Brand Name Fraud, 2000 .................................................................................................... 35Chapter 3: Integration of Informal Waste Workers in Formal Systems: Legal, Institutional andTechnical Aspects ....................................................................................................................... 36 3.1 Solid Waste Management Legal Framework ....................................................................... 36 3.1.1 Other Laws Address Specific Aspects of Waste: ................................................... 36 3.1.2 Solid Waste Management Specifications Related to Recycling in law 38/67 and its Executive Regulations: ........................................................................................................ 38The Informal Sector in Waste Recycling in Egypt 2
  • 4. 3.1.3 Other Laws and Regulations: .................................................................................. 39 3.1.4 Challenges Related to Law Enforcement ................................................................. 39 3.1.5 Laws Related to the Formalization & Licensing of Businesses .............................. 39Chapter 4: Assessment of Integration Process of Informal Waste Workers ................................... 44 4.1 Awareness and Information Dissemination ........................................................................ 45 4.2 Actions towards Formalization of Businesses .................................................................. 45 4.2.1 Registration through Local Authority .......................................................................... 45 4.2.2 Recourse to Registering with the SFD ......................................................................... 46 4.2.3 Fear of Taxation ......................................................................................................... 47 4.2.4 Complexities of Formalization of Land Tenure............................................................ 47 4.2.5 Cooperating with the Industrial Modernization Center (IMC) ....................................... 48Chapter 5: Lessons Learned, Conclusions and Recommendations................................................ 51The Informal Sector in Waste Recycling in Egypt 3
  • 5. ABBREVIATIONSAmCham American Chamber of CommerceAGCCD Association of Garbage Collectors for Community DevelopmentASMAE Les Amis de Soeur EmmanuelleAOYE Arab Office for Youth & EnvironmentAPE Association for the Protection of the EnvironmentBMZ German Federal Ministry for Economic Cooperation and DevelopmentCCBA Cairo Cleansing and Beautification AuthorityCAPMAS Central Agency for Public Mobilization and StatisticsCCFD Comite Catholique Contre la Faim et Pour le DevelopmentCDA Community Development AssociationsCID CID ConsultingCRS Catholic Relief ServicesDanida Danish International Development AssistanceEEAA Egyptian Environmental Affairs AgencyEIA Environmental Impact AssessmentsEMU Environmental Management UnitsEPAP Egyptian Pollution Abatement ProgramEQI Environmental Quality InternationalFCC Federal Communications CommissionFEI Federation of Egyptian IndustriesFinnida Finnish International Development AgencyGCBA Giza Cleaning and Beautification AgencyGOPP General Organization for Physical PlanningGTZ German Technical CooperationIMC Industrial Modernization CenterMRF Materials Recovery FacilityMSW Municipal Solid WasteNGO Non Governmental OrganizationPET Polyethylene TerephthalatePVC Polyvinyl ChlorideRBO Regional Branch OfficeSEAM Support for Environmental Assessment and ManagementSFD Social Fund for DevelopmentSME Small & Medium EnterpriseSWM Solid Waste ManagementUNDP United Nations Development ProgramUSAID United States Agency for International DevelopmentThe Informal Sector in Waste Recycling in Egypt 4
  • 6. GLOSSARY OF EGYPTIAN TERMSCAIRENES: inhabitants of CairoFUUL MEDAMMES: popular Egyptian local dish made of fava beansLAE’ITA: scavenge and collect the waste by picking through dumps, landfills, and street binsMO’ALLEM (pl. MO’ALLEMEEN): Middlemen and intermediary buyers/dealers who own small-scaledepots. They live inside and outside of the garbage collectors neighborhoods. Some used to begarbage collectors themselves, others were never in that trade; both were able to accumulatecapital to acquire space to store large quantities of recoverables. They sell to wholesalers andlarge buyers of non organic waste.ROBABEKIA and SAXONIA Peddlers: an age-old group of people trading in old, used, and unwantedhousehold items, and exist throughout Greater Cairo and most other Governorates in Egypt.,TOGGAR (singular “tager”): Wholesale Merchants of Recoverables from Roamers:.SARRIIH (pl. SARRIIHA): Egyptian term for roamer or scavenger: Sarrih clandestine search wastebins for recoverable. Unlike the Zabaleen scavengers don’t have agreements with the owners orthe Waahis. Other terms exist such as “Sarriih Khorda,” which means roamer specializing in scrapmetal (literally, Sarriih means roamer; and Khorda means scrap). who roam the streets buying,trading, and exchanging recyclable waste itemsWAAHIS: Oasis migrants to the city. They first organized a collection service of paper fromhouseholds in the early forties. They sold the paper to public baths who needed to heat water overlong periods of time and to preparers of the local national dish fuul medammes.ZABBALEEN: Traditional Egyptian waste collector. Zabbaleen collect household waste in agreementwith the owners and charge their service. In most of the cases they have a fixed routes and fixedcustomers. The Zabbaleen formed an agreement with the Waahis (from the oases of Egypt) to takeover the collection and transport of household waste to their own homes. This latter group wasdenied their share of the monthly fee collected by the Waahis, and sometimes had to pay him a feefor access to the waste. As the Zabbaleen became more involved in waste collection, they startedto receive a small fee from the Waahis.The Informal Sector in Waste Recycling in Egypt 5
  • 7. THE INFORMAL SECTOR IN WASTE RECYCLING IN EGYPT CID CONSULTING MAY 2008INTRODUCTIONThe German Technical Cooperation (GTZ) executes The Recycling Partnerships project on behalf ofthe German Federal Ministry for Economic Cooperation and Development (BMZ). It takes a closelook at global experiences around the integration of the informal sector in solid wastemanagement. CID Consulting was commissioned to undertake a study specific to Egypt, withinthe sector project “Promotion of concepts for pro-poor and environmentally friendly closed-loopapproaches in solid waste management (SWM)” work title: Recycling Partnerships; PN 03.2144. Itis hoped that this study, along with others conducted in other developing countries will enrich andinform the current debate around the informal sector in solid waste management. The study sumsup key factors, planned and unplanned events, circumstances that lead to an increasedinvolvement of the informal sector in SWM in Egypt. It ends with an outlook on approaches andmechanisms which might be taken to advance the process further.METHODOLOGYThe study used a combined methodology of desk research of reports, papers, conferenceproceedings, numerous focus groups and in depth interviews with key representatives of thesector, their organizations, government representatives, donors, consulting firms and individualrecyclers. It is structured in the following manner:Chapter 1: Historical Descriptive Research: presents a brief chronicle description of thedevelopment of the Informal Sector in SWM in Egypt. The research reviewed existing literature,interviewed garbage collectors who came to Cairo in the late forties, and reviewed reports on thesector from the early seventies and eighties.Chapter 2: Overview of the Institutional Framework of Informal Waste Workers: This chapterpresents the continuum of informality which exists in Egypt and tracks its evolution. It outlines therole of intermediaries, umbrella organizations, issues of licensing, associations, cooperatives, andtheir viability. The chapter identifies the organizations which have been formed to mobilize theinformal sector, and describes the manner in which their local initiatives attempted to integratethat sector. Meetings with members of these organizations led to a description of how theseactivities were designed and undertaken. An analysis subsequently attempts to outline whatfactors and structure influenced the formation of coalitions or impeded them. This process isreviewed within the socio-politico cultural context of Cairo and Egypt. Aspects which may haveinfluenced the process in an indirect manner are extrapolated. The historical and institutionalgrowth of Cairo as a city, the changing face of the economy, and the legal and political changesover the past fifty years are the backdrop to the discussion in this chapter.Chapter 3: Integration of Informal Waste Workers in Formal Systems: Legal, Institutional andTechnical Aspects: This chapter covers the legal framework within which the process offormalization or exclusion occurs. Laws, decrees and ordinances are listed and a discussion ofThe Informal Sector in Waste Recycling in Egypt 6
  • 8. how they impact the informal sector is provided. The chapter also outlines key factors and keyactors contributing to the integration of the informal sector in SWM systems, such as: Governmentefforts, donor efforts, the informal sector’s efforts, and Non Govermental Organizations’ (NGOs)efforts. Research methods used included focus groups, a review of existing reports, and meetingswith representatives of garbage collectors and municipal heads, consultants in the wastemanagement field, practitioners, NGO’s and waste dealers to arrive at elements of successfulintegration models where they exist.Chapter 4: Assessment of the Integration Process of Informal Waste Workers: This chapteranalyzes and assesses the sustainability of current practice to date with regards to the integrationof the informal sector. Focus groups with practitioners and researchers were undertaken to assistin the: identification of necessary strategies to promote and ensure the sustainability of theintegration process; identification of further external support that might be necessary;determination of whether and how the integration process is positioned in the poverty reductionstrategy of EgyptChapter 5 : Lessons Learned, Conclusions and Recommendations: An analysis of the pointsoutlined above yielded recommendations on how to proceed to bridge the gap between officialpolicy and the current status of the informal sector. The study terminates with recommendationsand lessons learned for potential transfer to other contexts, for further adaptation and tailoring tothese specific realities.The Informal Sector in Waste Recycling in Egypt 7
  • 9. Chapter 1: Historical Descriptive Narrative of Egypt’s SWM SituationThe current actors in Egypt’s Solid Waste Management System are many. The very first organizedservice ever provided in the largest city in Egypt, Cairo the capital, was one which was designed,managed and implemented by the informal sector. The oasis migrants to the city, the waahis, firstorganized a collection service of paper from households in the early forties. They sold the paperto public baths which needed to heat water over long periods of time and to preparers of the localnational breakfast food fuul medammes (fava beans). At that time the population of Cairo wasaround 2 million. Other cities in Egypt disposed of their organic waste by raising small animals onthat fraction. Non organic waste had still not begun to appear as Egypt was largely an agriculturalcountry and communities enjoyed rural characteristics. Municipalities were not charged with theprovision of cleansing services to towns and cities. No laws, ordinances or regulations existed toregulate the sector or the service. Environmental agencies, ministry or strategy were non existent.1.1 Actors in the Informal Recycling Economy1.1.1 The Traditional Waste Collectors (Zabbaleen)Garbage collectors first appeared in Egypt in the city of Cairo in the late forties. They providedresidents with a door to door, daily collection service and survived on the recycling of organicwaste which they fed to pigs and goats. They lived on the edge of the city in what became knownas garbage villages, referencing the squalor and living conditions where household waste wasbrought back to their homes for the sorting and animal raising activities. These informalsettlements grew in number and density as they became home to the ‘zabbaleen’ (Arabic forgarbage collectors) who had migrated from the rural south of Egypt, specifically from the provinceof Assiut, 400 kilometers south of the capital, to the outskirts of Cairo. They formed anagreement with the waahis (from the oases of Egypt) to take over the collection and transport ofhousehold waste to their own homes. This latter group was denied their share of the monthly feecollected by the Waahis, and sometimes had to pay him a fee for access to the waste. As thezabbaleen became more involved in waste collection, they started to receive a small fee from thewaahis. For residents of Cairo receiving the service however, the difference between the waahisand zabbaleen is not readily apparent. The latter were subjected to numerous forced evictions (5-6 in the span of 30 years) but each time were told by authorities where to resettle in recognition ofthe need to keep them operating the city’s waste system and in the absence of any otheralternative to municipal waste management in Cairo.The understanding was that the garbage collectors (zabbaleen) would continue to deliver thepaper to the waahis, while keeping the food to raise animals and to trade metals and plasticswhich had begun appearing in household waste in the fifties.The introduction of fuel oil and the introduction of private baths in dwellings in the 1940’sgradually disrupted this chain and led to the gradual disappearanc of public baths. Thus thewaahis no longer found ready customers among the fuul medammes producers nor in theoperators of public baths.As Cairo grew, so did the coverage of the waste collectors of high income neighborhoods. Ruralto urban migration patterns brought in more farmers with whom they had kinship ties. Thecousins they had hired soon became licensed with their own collection route and their ownThe Informal Sector in Waste Recycling in Egypt 8
  • 10. recycling trading networks. Nobody organized the system. It grew and evolved in an organicmanner with the growth of the city and as a result of the adaptability and ingenuity of the informalsector.Up until l990, garbage collectors used to set out on donkey-pulled carts to individual residencesin Cairo. From 1990 they began converting to mechanized trucks in response to an order by theCairo Cleansing and Beautification Authority (CCBA) – an agency which was established in 1986 toprovide overview to the various actors in the waste management system of the city, to provideservices to hitherto unserviced low income neighborhoods, and to license new Egyptian privatecollection companies. A similar agency was formed for the second largest city adjacent to Cairo –Giza – which is considered part of the greater Cairo area. This agency was charged with licensingthe traditional collectors serving the Giza residential areas and Egyptian private companies whichwere formed in the late 80’s to service commercial waste generators and/or neighborohods whichwere not serviced by the traditional collectors. Waste Recovery in Garbage Collectors’ Naighborhoods © Norbert SchillerThey were given licenses to collect residential waste from designated areas. However, thecontractual basis by which the CCBA and later, local city councils engaged the informal sectorhousehold operators, differed from the one by which they engaged formal private sectorcompanies. The latter purchased tender documents, bid competitively, signed a contract with theCCBA and got their contract fee from the same Authority. The zabbaleen, on the other hand, wereleft to collect the fees directly from their clients and were open to the risk of some residentspaying for the fee-for-service and others not doing so. They also had to pay a deposit ‘insurance’to the CCBA up front, in return for the right to service a specific number of apartment blocks. Theyhad no guarantee that these blocks were all inhabited, that residents would pay, or that theywould recover their cost. The CCBA provided direct services in the area of street sweeping, streetlighting, maintenance of public parks, etc. The garbage collectors were illiterate, did not knowhow to drive motorized vehicles, and were unable to access credit to purchase their own trucks.They relied on the intermediation of the waahis to assist them in obtaining licenses from theCCBA. In the nineties, some of them had acquired the expertise of doing that and had evenbecome intermediaries for other members of their own neighborhood among those who soughtlicensing to service specific neighborhoods. The traditional waste collectors themselves invested inthe development of their own community when they acquired a sense of land tenure andownership security in the mid eighties.The Informal Sector in Waste Recycling in Egypt 9
  • 11. 1.1.2 Roamers (Sarriiha)They represent a trade that covers all of Egypt. Their name derives from the nature of theiractivity: Sarriiha (singular sarriih), are those who roam the streets buying, trading, and exchangingrecyclable waste items, and “lae’ita,” are those who scavenge and collect the waste by pickingthrough dumps, landfills, and street bins. Other terms exist such as “sarriih khorda,” which meansroamer specializing in scrap metal (literally, sarriih means roamer; and khorda means scrap). Theyroam around the country in both rural and urban areas either with pushcarts or on donkey-pulledcarts. They have no fixed neighborhood where they all agglomerate the way the garbage collectorsof Cairo do. They have no community-based organization to represent them. They barter withresidents in low income neighborhoods in Cairo and in towns and villages in the Delta and UpperEgypt. They exchange mainly plastics and metal which housewives have set aside for them inreturn for household items of utility. These range from clothes pegs to glasses, pitchers, plastictubs, and the like. They purchase recovered items from commercial waste generators as well.They also purchase source segregated waste from commercial and institutional waste generatorssuch as supermarkets, butchers, metal workshops and the like. The roamers possess limitedcapital especially if they work for themselves. They may be attached to a trader who owns a depot(a mo’allem) who supplies their donkey cart and the day’s cash for cash transactions. Themo’allem’s advantage is that he possesses capital and storage space and thus is able to buywhatever these roamers recover from their day’s bartering activities with residents. He also hasbetter market information than the roamers.1.1.3 Robabekia and Saxonia PeddlersThey are an age-old group of people trading old, used, and unwanted household items, and existthroughout Greater Cairo and most other Governorates in Egypt. They have acquired a vast know-how in trading, bartering, buying and selling. They have also accumulated knowledge of fixing andrepairing old appliances, furniture, house wares, and simple machines by way of knowing where tofix each of the items, where they could be potentially sold. Robabekia includes all items that fallunder old and used appliances, house wares, apparel, paper, books, glass bottles, and scrapmetal. Those who roam the streets of the neighborhoods calling out “saxonia,” are in search of oldclothes and unwanted apparel, which they trade along with dishes, plates, bowls, and tubs.“Saxonia” refers to hard porcelain produced in Saxony.1.1.4 Middlemen and Intermediary Buyers/DealersThese live inside and outside garbage collectors neighborhoods. Some used to be garbagecollectors themselves. Others were never in that trade; both were able to accumulate capital toacquire space to store large quantities of recoverables. They are known as “mo’allemeen”(singular “mo’allem”) who own small-scale depots. They sell to wholesalers and large buyers ofnon organic waste.1.1.5 Wholesale Merchants of Recoverable from RoamersThese buy in bulk from small merchants who roam the streets of Cairo and from the middlemenwho live in low income and garbage neighborhoods and who buy from waste generators, roamersand garbage collectors. They are large-scale dealers, known as “toggaar” (singular “taager”) whoown large warehouses specializing in a single type of recyclable.The Informal Sector in Waste Recycling in Egypt 10
  • 12. 1.2 Formal Actors in the Solid Waste System1.2.1.In the early 70’s the traditional collectors of Alexandria mobilized and demanded infrastrucutre fortheir neighborhood from the then governor of Alexandria. They threatened to strike if they werenot granted basic human conditions (water, sanitation, lighting, etc.). The response of theAlexandria governorate was to evict them otuside of the city and disperse them. A few continuedclandestinely but were not enough to maintain the level and coverage of service to the city. Thegovernorate responded by contracting small private hauling companies and NGO’s, andsupplemented their efforts with municipal services on a campaign basis. Years of this system stilldid not lead to a cleaner city. The situation was exacerbated during the peak summer monthswhen more than 2 million Cairenes (residents of Cairo) descended upon Alexandria in escape ofthe heat of Cairo.In 2000 the governorate of Alexandria decided it had exhausted all local solutions to the problemof the city’s cleanliness and resorted to international tendering of the service, but this time toinclude the novel component of sanitary landfills since uncontrolled dumpsites had become amenace to most major cities in Egypt. There was no attempt to draw elements of high recyclingrates and labor intensive technology leading to high employment in recycling as practiced by theinformal sector or to include that sector in the new plan. Decision makers felt a great weightwould be lifted off their shoulders if they were left with the task of only monitoring theseinternational contracts. Recognizing that they did not have the competence to monitorinternational contracts, the governorate of Alexandria (in 2000) and later the governorate of Cairo(in 2002) sought the assistance of the United States Agency for International Development (USAID)to establish and train a Contract Monitoring Unit to oversee the implementation of the workplan asagreed upon between the governorate and the international winner: in the case of Alexandria,Onyx (Veolia) and in the case of Cairo, two Spanish firms and one Italian firm.Governorates come under the structure of The Ministry of Local Development. It is the governingbody charged with the administration of governorates to include local city councils andEnvironmental Management Units (EMUs) established in the nineties when the Ministry of State forthe Environment and its executive arm, the Egyptian Environmental Affairs Agency (EEAA) wereestablished. The EMU’s are located in the governorate central offices. Governorates are vestedwith the authority to negotiate and contract waste management services to ‘private’ operators.They have the ability to raise local revenues to supplement the local waste cleansing ‘fee forservice’ in order to meet contractual obligations towards the private contractors. Localmunicipalities and city councils are charged with town cleanliness and the licensing of small, localoperators.1.2.2 MinistriesThe Ministry of State for the Environment has a mandate to monitor and protect Egypt’senvironment. It is governed by Law 4/1994. The EEAA, is the executive branch of that ministry.It coordinates waste issues with line ministries in Egypt, monitors the implementation ofenvironmental guidelines, reports environmental violations to the relevant ministry, imposes andcollects fines from institutional violators, coordinates activities of its Regional Branch OfficesThe Informal Sector in Waste Recycling in Egypt 11
  • 13. (RBOs) and governorate EMUs. It produced a national waste management strategy in 1998 and isresponsible for monitoring its implementation and dissemination to the public at large as well asto institutions. The National Waste Management Strategy specifies operational targets for waste, tobe met for all of Egypt:• Collection coverage must exceed 60% for towns by 2005 and 70% by 2010.• Collection coverage must exceed 80% for capitals of governorates by 2005 and 90% by 2010.• A minimum of 80% of disposal to occur in landfills as opposed to dumpsites by 2005 and 90% by 2010.• 50% of organic waste generated to be composted by 2005.• 20% of solid waste generated to be recycled by 2005.• 40% of municipal solid waste by 2005 to be source segregated into wet and dry by 2005• 5% source reduction to be achieved by 2005• 100% cost recovery of waste management services to be reached by 2005• The level of funding for waste management services to reach 0.35% of GDP by 2005.Up till 2008 this was not met.The adminsitrative structure of formal actors in the waste management system is shown below. Ministry of State Ministry of Local Ministry of for Environment Development Social Affairs (EEAA) RBOs NGOs Governorates Waste Treatment Private and Recycling Contractors Centres Local City Councils Environmental Management Units – EMU’s The Formal Institutional Framework for Solid Waste Management in EgyptIn order to achieve its mandate, the EEAA is required to build the technical and managerialcapabilities of environmental officers in the EMU’s and RBO’s, provide some financial support topublic, private, and non profit groups to comply with laws and regulations. In order to do that, ituses a mechanism of an Environmental Protection Fund and designs special programs for specificlengths of time (e.g. the Industrial Waste Reduction Project). It sites the locations for sanitarylandfills and partners with donors to achieve the national waste strategy.The EEAA does the following:• Sites landfills for governorates, towns and cities.The Informal Sector in Waste Recycling in Egypt 12
  • 14. • Develops the design elements, specifications and principles of the Environmental Impact Assessments (EIA) for waste treatment and disposal facilities in concert with the relevant local authority• Reviews EIAs submitted by the relevant administrative agency or licensing agency, and issues an official judgement within a 60 day period.• Monitors the Environmental Register facility to ensure data consistency with the actual environmental status; undertakes sampling and conducts appropriate checks to verify complaince with environmental standards.The Ministry of Health oversees the vast network of healthcare institutions generating clinical andhealth care waste, such as public hospitals, teaching hospitals, private hospitals, private andpublic clinics, public and private labs, pharmaceutical firms, etc. It has a clear mandate to enforcethe safe management of hazardous clinical wastes generated by these facilities. In the currentcontext of lax enforcement of relevant rules and regulations and/or charging violators, theinformal sector has become an unfortunate actor in the recovery and recycling of hospital waste.Syringes, intravenous tubes, empty bottles of expensive medication find their way to informalrecycling markets: informal recoverers process the plastic and sell it to industrial manufacturers.This activity exposes the waste recyclers in the informal economy to untold hazards, primarilyhepatitis C caused by the exposure to infected needles while attempting to recover the plasticportion of the syringe.The Ministry of Agriculture is responsible for directing farmers towards safe, appropriate methodsof managing agricultural residues. In Cairo, the introduction of new rice harvesting technologiesin the late 90’s led to agricultural residues being burned in large quantities and mixing with theexisting large quantities of smoke emanating from burning household waste in uncontrolleddumpsites in Cairo. The persistence of that ‘black cloud’ hanging over Cairo for three to fouryears during the months of October and November, drove waste management policy makerstowards the resolution of the problem by tendering the entire system to international bidders andinviting multinationals to take on the whole system, not just the final disposal end of it.The Ministry of Irrigation and Water Resources is the primary agency to which falls theresponsibility of the welfare of the Nile - the lifeline of Egypt. As small rural towns grow andmunicipal services do not meet the needs of burgeoning populations, municipal waste is dumpedinto the river, in irrigation canals and other waterways. Tourism also contributes to the pollutionof the Nile as cruise ships practice uncontrolled, illegal dumping of effluent and municipal wasteinto the Nile.1.2.3 The Formal Private Sector1.2.3.1 The For Profit Private SectorPrivate contractors in the waste sector are of two types: local, Egyptian companies and foreignmultinationals. The latter bid for, and won international contracts to manage the waste of theentire city of Alexandria and three out of the four zones of Cairo. Cairo was divided into fourzones, as each corresponded to the size, population and waste generation rate of Alexandriawhich had led the experiment in international contracting three years before Cairo. One zone waswon by an Italian Public Private Partnership Firm: AMA, a second was won by the Spanish Urbaserwhich later became known by the name Enser; the third was won by the Spanish FCC. The latterThe Informal Sector in Waste Recycling in Egypt 13
  • 15. also won a portion of the Giza contract while the Italian Jacorossi won another portion of Giza.When no one qualified or bid for the fourth zone in Cairo (the southern zone) the CCBA formed apublic private firm called El Fostat to do that. El Fostat, in turn sub-contracted part of its southernzone to an Egyptian private firm entitled Europa 2000. The Not for Profit Private SectorCommunity Development Associations (CDAs) all over Egypt have implemented community basedwaste management schemes. These have not had a visible impact on the national level yet providemodels which can be mobilized for interventions around recycling, source segregation into wetand dry, and for the establishment of small processing and trading centers for recycling. Theyrepresent the mosaic of community groups in Egypt today. NGOs and CBOs have playednumerous roles in the waste management system of Egypt. These are summarized here below:1. Providing assistance and welfare relief to the informal sector2. Implementing development initiatives in waste management at the grass roots3. Testing pilot schemes designed to upgrade the working methods of the informal waste sector4. Demonstrating replicable small scale waste systems based on informal sector aspects of recovery and recycling5. Undertaking action research at the grass roots around waste issues6. Participating in research projects around the integration of the informal sector7. Advocating for the rights of the informal sector8. Communicating with government agencies, the media and other NGO’s to place the informal sector on the policy agenda for waste management in the city and in the country9. Conducting public awareness campaigns around innovative methods of waste segregation at source10. Approaching donors to fund development projects11. Raising in kind contributions from individuals and the private sector as well as community groups to improve living and working conditions of the informal sector. The Popular Economy Private SectorThe licensed Semi Formal, the Informal and Traditional sector (waste collectors, recyclers,manufacturers, scavengers, sorters, recoverers, and traders) constitute a sizeable portion of thewaste recycling system in Egypt. Success of the informal sector in achieving high recycling ratesand establishing trading channels shows promise in the creation of market-based incentives tointegrate this sector in the overall waste management structure. Their principal contribution hasbeen their long standing and persistent handling of these materials as resources and not as‘waste’, their contribution to employment and livelihood generation around these materials andtheir achieving strikingly high rates of recovery and recycling, at no cost to local authorities,central governments or residents.1.2.4 Donors and Private SupportersAmong the principal partners supporting the traditional collectors of household waste weredonors such as the International Development Association of the World Bank, the Ford Foundation,the Association of Garbage Collectors for Community Development (AGCCD), Les Amis de SoeurEmmanuelle (ASMAE), the Danish International Development Assistance (Danida), the FinnishInternational Development Agency (Finnida), Unesco; International NGO’s such as Oxfam, theComite Catholique Contre la Faim et Pour le Developpement (CCFD), Association for the ProtectionThe Informal Sector in Waste Recycling in Egypt 14
  • 16. of the Environment (APE), Oxfam, and Catholic Relief Services (CRS), and consulting firms such asEnvironmental Quality International (EQI) and CID Consulting.1.2.5 Residents and Commercial Waste GeneratorsThe failure of the current system, coupled with a steady increase in population and urbanization,have brought about the collapse of Cairo’s waste services and caused a public outcry for a moreefficient system which accommodates the city’s residents and their lifestyle. Small kitchens, noaccess to waste shafts in new buildings, the preponderance of stray dogs and cats, and the evenbigger preponderance of a scavenging urban population living below the poverty level (% ofpopulation below national poverty line 2000-2006): 17% and proportion of the population belowthe poverty line (2004/ 2005): 19.6%1 led residents to call for a new look at the current poorlydesigned system.The system faced more challenges at the official level:• The lack of reliable and timely information on waste quantities, composition and characterization• Limited physical, human, and financial resources in the entire waste system.• Limited capacity of municipal and local city council officials in undertaking cleansing services• Limited capacity of municipal and local city council officials in enforcing laws, and monitoring of private operators• Local governments unable to cover cleaning system costs from the current fees for service and having to resort to piecemeal mechanisms and financial resources to provide adequate services.• The general absence of properly sited, designed, and constructed sanitary landfills• Unclear modalities of integration of informal sector waste workers: e.g. cooperation between international operators and local NGOs, traditional waste collection groups, and private operators.• Low level of public awareness, poor public behavior and practices with regards to waste handling and disposal1.3 Adaptive Strategies of the Informal Recycling SectorThroughout the last half century the informal waste collectors/recyclers have unrelentingly comeup with adaptive strategies to continue to access the waste and circumvent barriers to that accesswhile at the same time integrate into new systems as they came up. Theirs has been the mostregular and adaptable service because it springs from a survival strategy to make a living from thewaste since the fee for service traditionally went to the waahis. Thus materials are treated as aresource and a livelihood base. Examples of these strategies were:1. Renting a truck from outside the neighborhood for a few hours when donkey pulled carts werebanned. This involved using bigger cloth containers to collect the resource from several buildings,store at the corners of streets, then load onto trucks. This meant that they did not need to rentthe truck and driver for the full six (6) hours that the collection task lasted. Instead the truckcould quickly roll through their assigned route and quickly pick up these huge containers whichhad been planted at corners of streets in a span of two hours.,,menuPK:287166~pagePK:141132~piP1K:141107~theSitePK:256307,00.htmlThe Informal Sector in Waste Recycling in Egypt 15
  • 17. 2. Acquiring the capital to purchase trucks, and recycling machines, to build solid homes and toeducate their children. They did this by selling any gold belonging to their wives or daughters; bypooling cash savings among brothers; by selling any remaining small plot of land or house in theirancestral village, or by obtaining credit from loan sharks in the neighborhood.3. Teaching their sons to drive and giving them an education. In later years, this was to prove tohave been a critical decision in increasing their social mobility and their acceptance by Cairenes atlarge.4. Sustaining their daily collection from households on a door to door basis thus maintaining highservice levels to one third of the city’s high income neighborhoods and commercial wastegenerators (grocery stores, print shops, small garment Small Medium Enterprise’s (SMEs), metalworkshops, etc.).5. Maintaining their autonomy in organizing the expansion of the service in concert with theexpansion of the city. They obtained licenses from the CCBA whenever new neighborhoodsappeared in the city. More collectors and recyclers were hired. Cousins and other day laborersexpanded the workforce.6. Establishing a hub of recycling activity in their neighborhoods as their homes were sortingstations and their neighbors provided the entire value chain – from trading small amounts ofspecific waste: paper, cardboard, glass, plastic, cloth, metals, bones, etc. – to processing eachkind of recovered material: secondary sorting, baling, cutting large items with manual scissors,granulating, washing, drying, pelletizing, agglomerating, manufacturing The food was fed to pigswhich they raised in the back of their homes.7. Providing employment and income for thousands of unskilled, unemployed youths: today anestimated 300,000 people in Cairo are engaged - either directly or indirectly - in the collection,transport, recovery and recycling aspects of managing the solid waste of one third of the cityshousehold waste/resource. Women are predominantly responsible for the manual sorting of therecoverable components. Only 15-20% is not recovered. This is transported to Cairos mainmunicipal dump where, until 2003, it was left without any sanitary treatment.8. Establishing one of the world’s largest small enterprise recycling industries through privateownership of recycling machines, processing machines, maintenance equipment, tradingenterprises, and trading with the entire country all the way through to exporting plastic PET toChina. In 2006, at least 1000 SME workshops existed in the largest recyclers’ neighborhood -Mokattam.9. Refining their manual sorting expertise so that recovered items are sorted by highlydifferentiated characteristics and take a variety of trading routes. They are sold at different prices,depending on their level of cleanliness, wholeness and type, size, color, soiled or clean condition,etc. They do not sell the waste/resource unsorted directly to anyone, as it is their sorting activitywhich adds value to mixed waste. This resource is perceived as a nuisance by society. Wastecollectors do not sort communally; therefore it is possible to estimate, with a fair measure ofaccuracy, how much is recovered of each item.The Informal Sector in Waste Recycling in Egypt 16
  • 18. While the collection route is the domain mainly of men and children, the task of manually sortingthe garbage into separate piles of recyclables falls to the women and adolescent girls who do notaccompany their fathers on the garbage route. Upper Egyptian cultural norms dictate that theystay in their neighborhoods in order not to jeopardize family honor.Today, six recycling neighborhoods form a ring around the city of Cairo2.These are:1. Mokattam, with an estimated population of 60,000 - collects from downtown, Shoubra,Abbasiyya, Ramsis Square, Abdeen, Rod el Farag and parts of Nasr City and Zamalek;2. Ezbet el Nakhl, with an estimated population of about 25,000 - administratively in thegovernorate of Qalyoubiyya - collects from Heliopolis, Zeitoun, Saray el Qubba;3. Moetamadeyya - collects from Mohandessiin and Giza;4. El Baragiil - collects from Zamalek, Dokki, Agouza, Embaba and Mohandessiin;5. Tora - collects from Maadi, Basateen, Dar el salaam and others.6. Helwan, the southernmost neighborhood of Cairo.They sort and recycle around 80 – 85% of the resources/waste they collect, making a living fromrecovering, recycling and trading recyclable materials. They provide the more affluentneighbourhoods of Cairo with door-to-door service at a minimal fee paid by residents and at nocost to the Government.The recycling industries in their settlements have developed extensive backward and forwardlinkages with other informal and formal markets throughout the country. In addition to collectingmixed household waste, they also purchase source segregated waste from commercial andinstitutional waste generators, as well as roamers, middlemen, etc. These are sold as either endproducts or inputs for other manufacturing activities to large scale industry of informal sectorsmall enterprise Ez b e t El N a k he l El M o a ta m a d ia T ura a l-B a la d Traditional Waste Collectors Neighbourhoods in Cairo, EgyptChapter 2: Overview of the Institutional Framework of Informal Waste WorkersStudies undertaken by the “Support for Environmental Assessment and Management3 (SEAM)Program” in governorates outside of Cairo confirm the existence of a sizeable recycling informalsector with strong economic activity covering the entire country. It has largely goneundocumented and un-quantified. Its characteristics are:2 CID Consulting, “Study on Brand Name Fraud”. Commissioned by Chemonics/Ahmed Gaber & Associates, June 1998SEAM, “Support for Environmental Assessment and Management (SEAM) , environmental program implemented by the3Egyptian Environmental Affairs Agency.(EEAA), Entec UK Ltd and ERM with support from the UK Department forInternational Development (1996).The Informal Sector in Waste Recycling in Egypt 17
  • 19. • Thriving activity which recovers, trades in, processes and re-manufactures plastic, scrap metal, paper, cardboard and bones.• A culturally intrinsic practice of separation at the source, among households, institutional and commercial waste generators, which makes the sought-for items available when the roamers access towns, villages and neighborhoods.• Highly developed markets and strategies in the informal source segregated waste sector, and a chain management of the resource from generators all the way to recyclers.• Substantial employment opportunities in that informal sector of source segregated waste.• Specialized towns and centers for the recovery and trade of specific items appearing in the municipal, industrial and commercial waste streams. These are source segregated and traded through a chain of roamers, traders, middlemen, graduated traditional collectors and informal sector operators in all of Egypt’s towns and villages.• Small and medium enterprises appearing everywhere in small towns and larger villages around the processing, re-manufacturing and trading of particularly recovered recyclables.• Manufacturing of recycled end products which may sometimes not qualify to consumer protection standards. Informal arrangements embedded within the formal sector of collection, transport and disposal of municipal waste.• A very slow, gradual departure from re-use, recovery and recycling as urban lifestyles replace rural ones, but a persistence of that behavior well into certain suburbs of the capital.Where people leave off habits of re-use and recovery, scavengers -the poorest of the poor- step into perform that function and create a network which demonstrates highly developed survivalstrategies devised and adopted by the poor.2.1 Informality of Shelter is linked to Informality of LivelihoodIn 1993, a General Organization for Physical Planning (GOPP), the government agency charged withurban planning in Egypt, estimated that there were 23 informal settlements in the Greater Cairoarea with a total population of 5.88 million people and an average density of around 685 personsper hectare.4 Current estimates of the number of informal areas in Egypt vary. There is still noagreement on definitions and boundaries. From the public administration’s point of view Egypt’sinformal urban areas are often considered a problem. Yet, from a macro-economic point of viewthey have been the solution to housing for poor and low-income families for the past forty years.The fast growth of informal settlements particularly on the periphery of Cairo in line with fasturbanization has revealed the inability of government and the private sector to meet the demandfor land and housing. Spontaneous urbanization occurred mostly on scarce and therefore preciousagricultural land and dates back to the 1960s, though most growth occurred since 19865. Therapid growth of informal settlements took place in a situation of oversupply of formal housingunits, albeit for a different population category. The average price of land for low-income housingincreased 23-fold between 1960 and 1993.4 (GOPP, Upgrading of Informal settlements in Greater Cairo Region, Preliminary Report, Cairo, 1993, as quoted in El-Batran, Manal & Arandel, Christian, A shelter of their own: informal settlement expansion in Greater Cairo and governmentresponses).5 Estimates predict that between 1980 and 2025 nearly half of Egypt’s agricultural land will be lost to informal settlementsThe Informal Sector in Waste Recycling in Egypt 18
  • 20. Informal areas do not only house the urban poor. They also offer affordable housing to young,educated families, including public service employees and university students. Through theprocess of migration and urbanization, these communities mix, transform and add new values totraditional ones. They find new patterns of organization, informal economy, social networks andsolidarity mechanisms. From the 70s to the 90s the social structure of informal areas changedconsiderably, leading to the heterogeneous, culturally and socially incoherent informal areasstructure of the present. Before the 1970s informal areas were more like homogenous campsformed by rural migration to the periphery of large Egyptian cities. Since 1975, increasingurbanization and real-estate speculation forced many previously urban population groups intoinformal areas.The Egyptian government’s attitude towards informal settlements experienced a shift due to anumber of factors: one was pressure from international donors, another was social and securityreasons which date back to the early 90s. These were linked to religious groups having becomeprimary service providers, delivering aid to widows, health care for the poor, clothing and food topoor families and the sick in many informal neighborhoods in Egypt. Economic deprivation,political passivity and the absence of state security control provided the conditions for ideologiesof violence. The analysis of the social roots of Islamic militants reveals the extent to whichinformal areas bred political violence in the early 90s. Many came from Mokattam/ManchiyetNasser, neighbours of the zabbaleen. It became urgent for the government to respond with socialand physical upgrading of informal settlements. A “National Upgrading Policy of Informal UrbanSettlements’ went into effect in 1993 and according to United Nations Development Programm’s(UNDP) 2005 Egyptian Human Development Report more than half a billion Euros were spent onthese massive projects.6 Studies report that the overall impact has been less than expected withcontinued migration, unemployment and poverty still outpacing government resources.In 2006 President Hosni Mubarak announced an ambitious programme for improving people’sstandards of living in his election platform for his new six-year term. It included 12 projectsrelated to housing, education, health care, transportation and infrastructure, access to clean waterand sewage system networks in squatter settlements. The programme aims to improve randomlybuilt areas by guaranteeing property rights while extending water and electricity services, buildingschools, providing medical care and security services.7 The Fifth 5-year (2007-2012) Plan forEconomic and Social Development8 specifies guide-lines for participatory local developmentpolicies in poor urban areas. The government of Egypt has adopted four strategies for addressinginformal settlements:• upgrading,• redevelopment,• containment and• demolishing.6 UNDP and Ministry of Planning, Egypt Human Development Report: A New Social Contract. Cairo, 20057 Source: Source: Egypt State Information Service, Informal Sector in Waste Recycling in Egypt 19
  • 21. It has set criteria for the definition of each.9 Under these criteria, Manchiyet Nasser, the largestneighborhood which houses informal recyclers, qualified for upgrading. This has given therecyclers a greater sense of land security, but has not led to titling or registration of property.2.2 Business Aspects of Informality: International Contracting Threatens a DynamicRecycling SectorIn 2000 it became clear that government policy for the city of Cairo’s waste management washeading towards privatization to multinational firms. A number of organizations felt there was aneed to prepare the way for the integration of the Zabbaleen as a serious technical input and as alivelihood threatened by the advent of new entrants into the sector. A study undertaken in 2000documented the magnitude, growth and vitality of that sector in the Greater Cairo area, as well asits capacity to expand its service to new neighborhoods, generate income and employment, whilemaintaining its high rate of 80% recycling10. For this study, Mokattam area was selected to gatherinformation about the following specific activities: collection, transportation, recovery of primarymaterials, SMEs trading activities and small scale recycling industries. It showed that trading andmanufacturing networks had grown to cover the whole country from Alexandria to Aswan. Theindustry had spawned its own dealers, its own centers of production and recycling, and its ownbusiness culture of credit, trade and finance. The implications of this situation were thatinfluences felt in the informal recycling sector in Cairo reverberate all over the country andinfluence a much larger economic sector of poverty stricken Egyptians than is documented andquantified.2.2.1 Response to MarketsThe increase in the number of collection enterprises and corresponding increase in the number ofhouseholds served in Cairo over the last fifty years is indicative of the capacity of this informalsector to grow and expand, and shows its comparative advantage over the formal sector. Its abilityto respond to demand-driven forces faster, and to design systems more flexibly has served it wellin braving the forces of change in the waste management systems of the city which never includedthem in the dialogue or design of these systems.2.2.3 Ownership of Land, Sorting Space and other AssetsTo this day, very few residents in the informal neighborhoods where recyclers live have registeredtheir land or secured legal title to their property. However, they have established informalownership to the land which is not officially recognized or registered with the government, butwhich is honored by residents who know and recognize each others’ rights to the land on whichthey live and work. This has facilitated the sale of land and other transactions such as rentingproperty for housing, trading or recycling activities. It has allowed them to rent and sell suchproperty to generate income and capital to invest in their diverse enterprises. The long years of coexisting on the fringes of the city have engendered enough trust to allow them to acceptdocuments which transfer property informally in recognition that they are all at risk of not beingable to claim their right to the land if and when the government decides to evict or relocate them.9 It is noteworthy to mention that Hernando de Soto presented nine types of informality based on threecriteria: land tenure, zoning and type of construction.10 CID Consulting “The Informal Solid Waste Sector in Egypt: Prospects for Formalization”. A study conductedby CID Consulting for the Ford Foundation and funded by the Institute of International Education (IIE).October 2000.The Informal Sector in Waste Recycling in Egypt 20
  • 22. 2.2.4 CapitalThe network of social and personal relations within such communities is in effect a form ofcollateral. Social norms and pressure become the mechanism for enforcement of the repayment ofthe debt. The reputation of the borrower is at stake compromising his standing in the communityand the trust of his compatriots in the trade, thus jeopardizing future business opportunities.Studies show the dependence of the recycling enterprises on informal sources of capital andlimited access to, and utilization of any formal sources of financing, such as the Social Fund forDevelopment (SFD). While these opportunities are created through some of the non profits, theydo not meet the growing need and demand for financing. As the number of trading and recyclingenterprises increases so does the demand for diverse sources of capital. This creates anopportunity to develop appropriate programs for such endeavors.2.2.5 Labor and WagesAs with labor markets in the Greater Cairo area, workers operate informally in this sector. Theaverage number of workers in the garbage collectors enterprise, i.e. the garbage collector, hisunpaid family workers and other paid wage earners who collectively work on the collection routesand recovery of primary materials is 7.4 persons. The average number of workers in the tradingenterprises is 4.6 workers/enterprise and 6.7 in each of the recycling workshops.2.2.6 Growth in Recycling EnterprisesRecycling industries in Egypt have expanded, diversified and increased in number over the last 25years. The 1980s ushered in a move towards investing in recycling workshops starting in theMokattam settlement but now extends to the entire country. Initiatives to start such endeavorswere supported by external funding and technical assistance. From 1996 to 2000, the number ofworkshops in Mokattam increased by approximately 40%. The recycling workshops in the areacreated approximately 43% new job opportunities during that four-year period (1996-2000).These recycling workshops rely on the primary material sorted by the waste collectors and soldthrough intermediaries. They have also become a magnet for youth from other parts of the city.Some workers commute to the settlement on a daily basis, while others have relocated and nowreside in the settlement. The size, scope and activities of the recycling workshops vary. Somespecialize 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 certaintypes of primary materials. The recycling workshops produce both final products andintermediary products. Their clients are located throughout the country and the city. Theintermediary products are sold to larger workshops and often to large-scale industrial plants inand around Cairo as well as those around the country, such as the 6th of October, the 10th ofRamadan, Alexandria, and Suez.2.2.7 Trading NetworksMost traders are part of the informal sector, but a significant number of formal sector traders areincreasingly attracted to this large and lucrative market. Intermediary traders buy the bulk of thematerials recovered by the garbage collectors on a weekly basis. Traders in recyclingneighborhoods generally specialize in one type of material such as glass or plastic, and sometimeseven on sub-categories of these materials such as PET plastic water bottles or PVC, etc. Onaverage, it takes a week to accumulate quantities that are large enough to sell to their customers:traders from other markets around the country, and in some cases large manufacturing plants.The Informal Sector in Waste Recycling in Egypt 21
  • 23. They have developed a large network of customers who rely on their proven ability to deliver therequired materials on a regular basis. More often than not, the agreements made between thesetrading partners are verbal agreements to which they all adhere.2.2.8 Specialized Trading Towns and CentersStudies conducted in 15 governorates (South Sinai, Red Sea, Aswan, Qena, Sohag, Assiut, Minya,Dakahleya, Gharbiya, Menoufiya, Damietta, Qalyoubiya, Alexandria, and Giza), and a photodocumentation of the recovery and recycling sector in Egypt, point to the emergence of townswhich have become specialized in the trade and recycling of specific items appearing in themunicipal, industrial and commercial waste streams. The items are source segregated and tradedthrough a chain of informal sector operators throughout Egypt’s towns and villages. Themiddlemen must have access to land to organize the sorting and storage functions. Credit playsan important role in these wholesalers’ ability to conduct business as many financial transactionsare based on term.11 In the field of recovered metal they make their way to metal processingplants in the following manner:Steel Dekheila (near Alexandria), Mostorod & Abu Zaabal (near Cairo)Iron Mansoura, All over EgyptAluminum Miit GhamrCopper Miit Ghamr, CairoTin MostorodMany began as informal sector operators but have now become formalized with tax I.D.s due tothe need to bid on huge lots of metal. Their main source of recovered waste are the dealers whoroam the country on animal-pulled carts. These still operate in the informal sector of theeconomy and are not controlled by one large operator. Informal Recovery and Recyling Actvities © CID Consulting2.3 Informal Sector Recyclers: Private Business Partners to Large IndustryThe informal recycling sector’s trading methods present potential aspects as business partners tothe formal recycling sector and to government on a number of fronts:• Quick response to markets; this creates new demand for recyclables and energizes trade and investment.• Ownership of assets and its positive aspect for economic growth.• Growth in enterprises indicative of a vibrant popular economy.• Trading networks covering the entire country.11 CID Consulting. Study on the Social Development Aspect of Municipal Solid Waste Management in thegovernorate of Dakahleya, for ENTEC, the SEAM Program in the EEAA. 1965The Informal Sector in Waste Recycling in Egypt 22
  • 24. • High labor and employment generation vital for unskilled and semi-skilled labor force.• Higher than national average wages offered to workers.• Positive aspects of capital accumulation and investment – both for local and export economy as borne out by the export of PET plastic, and recovered empty paint cans.• A high degree of product differentiation in response to new demands and technological advancement in the recycling industries.Over the last two decades, an increasing number of usages have evolved for more and more of theprimary materials. As new market demand arises, the appropriate technology is adopted, and newchannels for market distribution and production are instated.When the Egyptian government adopted privatization of solid waste management to internationalcompanies, new recycling contractual quotas (20% of waste) were required of them. These werefar lower than the informal sector’s recovery rate of 80%. This was bound to adversely affect anentire industrial recycling chain, strain scarce natural resources, and increase the amount of wasteto be landfilled. In 2008, the recycling formal industry was feeling the effects in a serious way.This generated an interest on their part to examine and correct imbalances suffered by theinformal sector recyclers caused by current systems. They have come to recognize that theinformal sector is a private sector in its own right and have tangibly felt the impact of theirreduced access to materials from waste generators on their own large industries.Prior to privatization, feedstock from the informal sector had been flowing regularly to largeformal private sector recycling industries. Since privatization to intermational companies, thesteady supply of materials dwindled. These large industries are becoming a new, and potentiallyimportant actor in any scheme to integrate the informal sector in waste recycling. They haveunwittingly become advocates for the informal private sector recyclers which will affect severalfronts.2.3.1 Livelihoods, Income and EmploymentSo far efforts to integrate the informal sector within the multinational companies have not beensuccessful: multinationals expect traditional collectors/recyclers to act as a collection crew only,i.e. to not take the waste away to their homes for recycling and to work for a wage. They alsoexpect them to put in eight hour working days even if they can cover their routes in 4 hours. Andlast but not least, they expect them to do anything which is required in the companies’ garagesand transfer stations of multinationals. The informal sector collectors who collect only for thepurpose of recycling see no purpose to the invitation extended by the private international firms.This has forced multinationals to recruit unemployed youths and train them to be collectors. Fewrecruits find the occupation appealing and those who are recruited soon drop out. High turnoverrates among these new collection crews drew the multinationals to accept to hire the traditionalcollectors on their own terms, i.e. have them work on the route only for as long as it took to finishthe rounds, turn a blind eye to the continued practice of taking the mixed waste back to theirhomes to sort and recycle, and continue to use their own trucks instead of using the contractor’strucks as the contract stipulated. To date, the zabbaleen still transport mixed household waste intheir trucks, take it to their homes, sort it and profit from it. This is expected to end when, and if,contractual terms in the contracts between the governorate and the international companies areenforced. Up till now though, the Contract Monitoring Unit established in the CCBA and GizaCleaning and Beautification Agency (GCBA), have not fined the multinationals for these practices asThe Informal Sector in Waste Recycling in Egypt 23
  • 25. they too recognize the prolematic situation which these companies find themselves in and do notwant to jeopardize the system any more than it currently is.2.3.2 Exploitation of Household Waste Collectors by MiddlemenWhen the multinationals gave in to hiring the traditional collectors, none of them had formalbusinesses registered and thus could not sign contracts nor represent a large group of collectors.They had found it sufficient to operate with the licenses which had been granted by the CCBA andGCBA. Only the waahis had the forward looking inclination: they had registered small privatecompanies, NGOs and cooperatives as well. Once more the traditional collectors found themselvesneeding the intermediation of the waahis, but this time with the international contractors. Many ofthese contractors paid the intermediaries fair wages for each collector hired, but the middlemenpassed only the smallest fraction of it to the collector. Once more, exploitation was their lot. InCairo, the traditional collectors are now open to the exploitation by middlemen who possesslicenses and are therefore able to sub-contract with international companies directly.2.3.3 Competition for the Waste by ScavengersMultinational companies do not offer door to door collection services as that would have pushedthe cost of their bids beyond competitiveness. Placing household waste in the public domain(street communal containers) has meant that the traditional waste collectors have to contend withscavengers who now have access to waste pooling sites in neighbourhoods serviced by theinternational companies. This has reduced the amount of waste available for recycling as someresidents have changed their habits and now bring their waste to pooling sites. It has also meantthat the city has become much dirtier than prior to international contracting as scavengers litteraround the containers they scavenge, stray cats and dogs complete the damage and scavengersventure into the city on donkey pulled carts. These were banned in the 1990’s but became anevery day occurrence again in 2006!2.3.4 Residents’ DispleasureDespite the poor social image of the traditional collectors and their services, and in spite of theactual take over of the waste collection by the international companies, many Cairenes still preferthe door to door service of the traditional collectors. Cultural bias and class aspects keepresidents prefering not to bring their waste down to a waste pooling site. Lonstandingrelationships with specific collector families, bred over decades, have also led to the establishmentof social ties between collectors and residents so that the relationship is an important aspects ofthe system. A point of contention though is that these service recipients are obliged to pay twicefor the same service: once on their electric bill , as the fee for waste collection service became anintegral part of the electric bill as per the Egyptian government decree, to the international firms,and a second time directly to the door to door collector, albeit voluntarily and informally.Furthermore, residents are displeased with the increasingly unsanitary appearance of theirneighborhoods as waste pooling sites overflow with waste, containers are not large enough for thelarge volume of waste and scavengers leave the space surrounding containers with mountingvolumes of litter.2.3.5 Resettlement IssuesAnother threat is the potential resettlement to the outskirts of the growing city of Cairo.This would conceivably increases transport cost, travel time and labor cost in the recycling trade.This feature is discussed in Chapter 4.The Informal Sector in Waste Recycling in Egypt 24
  • 26. 2.4 Challenges Faced by Informal Sector RecyclersThis study conducted focus groups with small, informal and semi formal recoverers, recyclers,collectors, and traders. These uncovered numerous constraints faced by them:1. They have no fixed or predictable income.2. They are dispersed throughout the country.3. They are exploited by traders who own depots and who employ them4. They risk arrest, confiscation of their donkey and cart and are harrassed by police as theyroam around the city of Cairo on donkey carts which were banned in 1990 on the streets of Cairo.5. They are forced into the trade due to unemployment or as an interim stage in search foremployment.Traditional informal sector recyclers express the following challenges:2.4.1 Poor Ability to OrganizeFrom the outset the exploitative situation the traditional waste collectors found themselves in wasbased on the weak position of the collectors and the stronger position of the more powerful oneswho organized them. In the first decades of their presence in Cairo, the waahis exploited them.Later, it was the more powerful among them who had been able to negotiate with the governmentand obtain licenses to service a large number of apartment blocks. The latter kept the smallercollectors breeding pigs for them. The smaller waste collectors were content to service a smallernumber of flats (between 350-500) and accepted the exploitation by the more powerful men inthe trade. Exploitation also came from the pig merchants who seldom paid them the true value ofthe animals they sold claiming that a fair proportion of the herd was sick and not fit for slaughter.Their first taste of fair and equitable organization was when they formed a non–profitorganization, the AGCCD and an external facilitator, in the form a consulting firm EnvironmentalQuality International (E.Q.I.) was charged with implementing a credit scheme financed by OXFAMto introduce recycling of non-organics in the neighborhood. Their second experience was whenAssociation for the Protection of the Envirionment (A.P.E.), another non-profit, organized a girls’and women’s community recycling enterprise based on source segregated cloth and paper. Again,this was facilitated by a group of external volunteers. Thus the people in that trade had notlearned to trust each other and organize themselves in a common front, holding one opinion andone view with which to negotiate.More recently, the agreement with the multinationals involved the mediation of both the powerfulmiddlemen, either from among them or from among the waahis, or from their NGO, which turnedaround and granted the right to distribute labor and concessions to routes to the same powerfulmiddlemen who had negotiated independently with the multinationals. The NGO had become co-opted by the more powerful men in the neighborhood and no longer represented the interests ofthe poor and the voiceless.Organizing for true representation is thus one of the most critical constraints facing the informalsector recyclers. It is even more difficult for roamers and scavengers of waste pooling sites anddumpsites than for the traditional zabbaleen.2.4.2 Lack of Transparency of the SystemThe system has been marked by a lack of transparency from its inception. Be it the termsnegotiated by the waahis and the local authorities, or the terms negotiated between them and theThe Informal Sector in Waste Recycling in Egypt 25
  • 27. middlemen (moallemiin) or the present terms between the moallemiin and the multinationals, andeven the terms of contract monitoring for the present multinationals. The traditional wastecollectors therefore find themselves in the unenviable position of not having accurate informationand not knowing who to trust.2.4.3 Financial ConstraintsAccess to capital has been listed as one of the most critical constraints to growth in that sector. Todate, the need for capital and financing has not been adequately addressed as lending institutionsare currently not easily accessible to that business sector. Their informality, lack of education andlack of collateral all place contraints to their accessing formal financial markets. It is mostly NGO’sthat have reached that market.2.4.4 Legal and Contractual ObstaclesForeign companies are encouraged to cooperate with traditional garbage collectors, because oftheir vast numbers, their accumulated experience in the field of collecting, transporting, recyclingand disposing of municipal waste. Representatives of the Italian and Spanish company expresseda willingness to negotiate with one entity representing the traditional collectors within therequirements of their contract with the government of Cairo. The traditional sector needs to learnand start the process of forming one legal entity to represent the larger group of individualcollectors who could then act as a sub-contractor to the main contractor.Foreign companies are contractually required to recover 20% of waste only. There is no contractualincentive to reach the 80% recovery rate currently achieved by the traditional collectors. Thetraditional garbage collectors, who inherited this business from their fathers, whose traditions asprivate sector operators go back fifty years, would not easily accept to be employed just as acollection crew by the multinationals.2.4.5 Social Issues Related to Stigma of Trade and Perception of Society at LargeHandling garbage is not an attractive occupation, neither physically nor culturally, and does notconstitute an attractive option for Egyptian labor. People do not consider the sector an option foreducated youths and do not respect the work waste workers do. Much as people appreciatehaving their wase collected from their doorstep on a semi daily basis, yet they do not approve ofthe unseemly appearance of the traditional collectors, nor their soiled clothes and trucks.2.4.6 Need for Skills Upgrading – TrainingNew labor entrants in the waste sector need training, which entails cost, and will lead to higherwages. The traditional collectors are willing to cooperate and to upgrade their collection andsorting techniques, but this requires planned interventions. In 1986, the consulting firm E.Q.I.implemented a credit scheme which deliberately targeted pig breeders to convert them intoplastic, paper, cloth recyclers. This scheme was the genesis of the industry which exists inMokattam today. A similar scheme is required to convert the collectors into contractual partnersto the government and large recycling firms.2.4.7 Operational IssuesThe traditional garbage collectors’ means of handling waste lack appropriate hygienic standards.This renders them an unattractive institutional partner. A number of traditional garbage collectorsopt for continuing to raise animals on the organic waste. This further makes them unattractice aspartners to local authorities, local companies or multinationals. Alternative breedingThe Informal Sector in Waste Recycling in Egypt 26
  • 28. configurations need to be sought. The current options of compacting garbage or disposing of it inlandfills leads to a waste of raw materials and of job opportunities. Now that Climate Changeopens up prospects for carbon trading from the recovery and processing of organic waste, newavenues for changing current operational processes are opening up offering alternative uses forthe organic fraction of the waste. They will need the mediation of consulting firms, donors, andadvocates as well as investors and social entrepreneurs.2.4.8 InformalityThe thriving informal sector is a boon and a bane at one time. Interventions to correct the sector’shazardous work methods and sub standard products sector are necessary and are potentiallyfeasible. They will require policy interventions coupled with the temperate application of lawsuntil the industry is steered through the tricky transition from sub-standard, uncontrolled andhazardous production to quality production based on specifications and standards. Formalizingthe zabbaleen would address the aspect of labor shortage, and keep residents satisfied with doorto door collection, but it will also maintain health standards for finished products and industrialsafety standards for workers in that sector. Traditional garbage collectors have still not unitedunder the umbrella of one single federation or entity. This has dissuaded foreign companies fromcooperating with them.2.4.9 Difficulty in Acquiring and Asserting Ownership of PropertyOwnership of property, albeit informally, has emerged as an integral element in the informalsector activities. The majority of informal sector recyclers live and work in the same place. Theypurport to “own” the premises in which their enterprise is based, albeit informally, as well as theequipment that they use, vehicles or otherwise. The availability of sorting and storage space is acritical aspect of trading and growth in recycling markets. The establishment of depots all overthe city, and indeed the country, is linked to the availability of land, warehouse space, and use ofspace in the home as an unregistered business in informal neighborhoods. Giving the informalproperty holders legal title to these assets may allow them to use these in various transactions inthe formal and financial markets whether they are used as collateral or guarantees. Formalizationof property is a critical step towards the security which can later contribute to upgrading the trade.2.4.10 Inadequate Market Information and Market IntelligencePrices and market information are available in the immediate neighborhood and vicinity. Moreinformation becomes available as traders and recyclers create links and networks with othertrading neighborhoods and markets. However, poor communication and inaccurate informationlead to cut throat competition and recyclers relying on windfall profits rather than sustainedmarkets. This makes them an inappropriate partner to formal sector industries and increases theirpreference for informality, and their vulnerability.2.5 Non-Profit Community GroupsA significant institutional actor in the informal recycling sector has been NGO’s- both local andinternational - and faith based organizations.2.5.1. Association of Garbage Collectors for Community Development (AGCCD)It launched the first credit program for small and medium enterprise development in 1983 in theinformal neighborhood of Mokattam garbage collectors (the zabbaleen) through the interventionThe Informal Sector in Waste Recycling in Egypt 27
  • 29. of a consulting firm, E.Q.I. and with funding from Oxfam.12 Additionally, this NGO implemented anexperiment in Grameen-style lending in Egypt and launched the seeds of a Primary HealthProgram in the neighborhood, as well as experimented with new institutional arrangements forwaste companies to service the city132.5.2. Association for the Protection of the Environment (APE)Registered in 1984, A.P.E. started operating its first project -a composting plant- in 1987. TheRag Recycling Center was launched in 1988 followed by a Paper Recycling Project, a Childrensclub and Nursery for infants, a Mother and Child Health Project, and an Adolescent Girls HealthProject in 1996 and more. The NGO is governed by a 9-member all-volunteer board which playedan active role in project implementation for the first 7 years of its life. It has now trained a staff of65 people from the neighborhood to manage projects. While the urgency of living conditions ofthe people living in garbage neighborhoods drove APE’s projects towards welfare developmentapproaches, yet in parallel, the NGO piloted critically important projects which today bear theseeds of what might be an appropriate, efficient, culturally and locally responsive system forCairo’s waste system which would include the informal sector, most notably source segretation ofhousehold waste into wet and dry.2.5.3 Spirit of Youth for Environmental Services (SoY)Established in 2004, SoY has made source segregation a primary mandate of its mission. It hasmobilized youths to spread awareness around that practice in schools, community developmentassociations and has created a strong African network with the South African chapter of ShackDwellers International and with community based recycling groups in Kenya, Nigeria and the U.K.Its landmark intervention has been to demonstrate how the interests of multinationals (shampooproducing industries) converge with the interests of informal sector recyclers through theestablishment of recycling schools cum buy back centers of shampoo packaging which wouldotherwise be fraudulently refilled. This school teachers youths who became marginalized as aresult of international contracting of waste services in Cairo. Mokattam Recycling School © CID Consulting2.6 Lessons Learned from the Various Institutional Actors2.6.1 Lesson One: Recycling of Source Segregated Waste Dignifies the Trade andGenerates IncomeFor the women, A.P.E. chose income generating interventions revolving around rags and paper.Research and field practice had indicated that women in extreme poverty situations, coupled with12 Extensive documentation about the Mokattam Zabbaleen experiment can be found in documents compiled byEnvironmental Quality International, E.Q.I. 3B Bahgat Ali Street, Zamalek, Cairo13 Extensive documentation about the Mokattam Zabbaleen experiment can be found in documents compiled byEnvironmental Quality International, E.Q.I. 3B Bahgat Ali St., Zamalek, CairoThe Informal Sector in Waste Recycling in Egypt 28
  • 30. the exclusion particular to garbage collector communities, would probably not benefit to ameasurable degree from the extension of credit – micro or medium. Technical, social, andmarketing difficulties would probably have caused their enterprise to falter.14The Rag and Paper Recycling Centers15 designed and delivered income generating/povertyalleviation initiatives for adolescent girls and women in the informal sector, in which wasembedded a lifelong learning model in the field of non-formal education. It focused on lifelonglearning skills to empower mothers of the future; to build on the expertise of experts - girls andwomen involved in the manual sorting of municipal household waste in Cairo, to create conditionsof work revolving around recovery and recycling of man-made waste with dignity, and to empoweradolescents and adults to participate, as literate adults, in community and society. The projectsbegan in 1988 and 1992 alternatively and continue to the present day. They have become self-sustaining. One did not require external donor assistance while the other invested in inputs frompartners and donors such as the Ford Foundation, ASMAE, and others. Egyptian private sector in-kind donations and individual cash contributions as well as consulting time and expertise given ona voluntary basis helped get them established. Revenues from the recycling enterprise andcapacity building to manage these enterprises has sustained them.2.6.2 Lesson Two: Source Segregation of Household Waste into Two Fractions (Organicand Non Organic) is FeasibleIn 1992, A.P.E. tested a source segregation of garbage in two neighborhoods in Cairo (Manial andDeir el Malak) to develop new household level interventions which would reflect on the informalwaste workers and the city16. The methodology included door to door communication and publicawareness campaigns to raise awareness regarding the importance of at source separation.Findings were that 65% of residents in the two sample neighborhoods continued to separate theirgarbage at source into two components: organic and non-organic, for two years. Residents weremotivated to participate because of the information given to them about the hazards of mixingheavy metals with food waste and the attendant effects this had on human health and the foodgrown with contaminated compost. Residents were given a further incentive to participate byreceiving nominal prizes for having screened and source segregated their waste efficiently, at theend of each 2-3 month period.The plan was to deliver the organic waste to composting plants around Cairo while keeping thenon-organic in Mokattam to sort and separate for processing and re-manufacturing in the micro-enterprise workshops run by the men. The driving concern behind it was women’s exposure tohealth hazards while sorting. This pilot project was financed by the Ford Foundation and resultsindicated that:• sorting time was reduced by 50% (two instead of four hours per day),14 Assaad, Ragui and Rouchdy, Malak. “Poverty and Poverty Alleviation Strategies in Egypt”. A Report Submitted to TheFord Foundation, Cairo, Egypt, January 1998.15 Kamel, Laila R. Iskandar. Mokattam Garbage Village, Cairo, Egypt. Published by Laila R. Iskandar Kamel and printed byStallion Graphics. Cairo, 199416 Assaad, Marie and Moharram, Ayman. Final Report on the Separation-at-source Scheme as Implemented by theAssociation for the Protection of the Environment. Submitted to the Ford Foundation, January 1995.The Informal Sector in Waste Recycling in Egypt 29
  • 31. • women had more time to work, learn and earn in other productive activities in the neighborhood revolving around clean recycling industries, namely in the Rag and Paper Recycling Projects run by the Association for the Protection of the Environment (A.P.E.)• women and children were spared the health hazards associated with sorting mixed waste manually,• there would be potentially more non-organic waste to recover as it was unsoiled,Other studies implemented in the Delta and Upper Egypt indicated that Egyptians intrinsicallysorted household waste into organic and non-organic. The habit dies out among residents withlong urbanized patterns of living commensurate with high income levels.17.Municipal Waste Pulsing Project in Cairo – Association for the Protection of the Environment (APE2001):18In 2001, A.P.E. partnered with a Finnish NGO, Kema, supported by the Finnish Aid Agency, Finnida,to pulse whether the residents of Cairo would be willing to source segregate their household wasteinto two components only: food and non-food. The project trained a team of Mokattam garbagecollectors who had acquired an education – up to technical and university levels - on relayingpublic awareness messages to the residents of various neighborhoods in the greater Cairo area, aswell as to the garbage collectors. The team made presentations to 268 NGOs, 145 private andgovernmental schools, and ten (10) education directorates. Of the total groups pulsed, an average90 % accepted the idea of source segregation into two components and were willing to implementit. Implementation of source segregation did not actually take place. The pulsing consisted of apresentation to communities about the idea and their acceptance of it. Their response waspositive and indicative of a high participation rate as long as:• extra containers were distributed,• the collector kept the waste separated and did not render residents’ efforts futile by mixing waste components together again and• awareness continued over time until the habit was entrenched.But while non-profits were institutionalizing the know-how of the informal recyclers andtransferring it, there was still a big learning gap on the part of the municipalities, the public andthe media. This meant that new strategies for information and education had to be designed inorder to augment the learning that the city of Cairo could acquire. New partnerships needed to becemented and new processes of decision-making explored. As a result of these findings this wasreplicated in the South Sinai town of Nuweiba.Scaling up to Town Wide Demonstration Model, Nuweiba, South Sinai, 1998:In 1997, A.P.E. partnered with a local NGO in the town of Nuweiba in the South Sinai, Hemaya, totest the feasibility of source segregation into two fractions only: organic and non organic, on atown wide basis and establish a municipal recovery facility to be oprated by youths who wouldhandle non organic waste only and hare in the revenues from sales, in an attempt to replicate theinformal model of Ciaro into a joint youth enterprise. The pilot was adapted to the peculiarities ofa region blessed with some of nature’s more amazing wonders -- coral reefs in the Red Sea and17 CID Consulting, Two studies conducted by CID. on “The Social Development Aspects of Solid Waste Management inSohag and Dakahleya”. Commissioned by ENTEC Consultants to the Technical Cooperation Office (TCOE) of the EgyptianEnvironmental Affairs Agency (EEAA) May and August 1996.18 Association for the Protection of the Environment, Final Report on Source Separation Project to KEMA NGO, 2000.The Informal Sector in Waste Recycling in Egypt 30
  • 32. mountains in the South Sinai, and to the demographic peculiarity of bedouins wanting the organicfraction of the waste to feed their goats.The waste situation in the South Sinai had reached proportions which called for interventions of allstakeholders and had gained the attention of the Protectorates Department of the EEAA. Theyapproached CID Consulting to design and implement a demonstration project for Nuweiba. Thusit was that in 1997 CID transferred A.P.E. source separation and recycling concepts and approachto the South Sinai. Municipalities, the hotel industry, the EEAA, and two other NGOs weremobilized. A three-month training phase on source separation into organic and non-organicwaste was funded by the European Union-Protectorates Department. Subsequently, the SocialFund for Development (SFD) granted a start-up fund of a half a million Euros million for a projectin the South Sinai cities of Nuweiba. 19 Hemaya MRF, Nuweiba, South Sinai © CID ConsultingTen years into implementation (in 2008), source segregation of household, commercial and hotelwaste was undertaken at an 80% efficiency rate for hotels and 90% rate for households. This wasbecause frugal habits of residents meant little organic waste was disposed of. The decisive factorin hotel efficiency was the close monitoring by managers and their turnover rate. The decisivefactor for residents was the tangible actions of the collection crew in keeping the two fractionsseparate. Today, separate garbage collection occurs, transport, disposal, recovery, recycling occurat the municipal recovery facility and sanitary disposal is required for less than 5% of residualwaste.The system components consist of:• a source separation scheme of municipal solid waste into organic and non-organic through training of residents, hotel staff, tourist and commercial establishments;• a collection system for separated waste;• organic waste channeled to serve as food for animals in keeping with the request of the indigenous Bedouin population;• transport of non-organics to a sorting transfer station (materials recovery facility-MRF);• processing of plastic, paper, cardboard, glass and metals in the MRF;• directing the processed output for trade in Cairo and other industrial centers for recycling;• disposing the remaining non-recyclable components into a controlled, managed dumpsite.19 Reports compiled by CID Consulting and presented to the Social Fund for Development, SFD, 1997-1998The Informal Sector in Waste Recycling in Egypt 31
  • 33. At-source Separation Non-Organic (Solid) Waste Organic Waste Transfer Station Food for Animals Sorting and Processing or Composting 80% recyclables to be 20% non-recyclables Remains to traded in Cairo to sanitary landfill Sanitary LandfillNon-organic waste only arrives at the transfer station and is loaded on a central conveyor beltwhere workers sort it to its different components: paper, cardboard, plastic, glass, and metals.Each material is then channeled to its specific processing room. Certain types of plastic aregranulated; paper, cardboard and metals get compacted, each in a separate machine. Theprocessed/separated product is stored for sale to recycling industries in the Greater Cairo areathrough the Mokattam recyclers and other traders.2.6.3 Lesson Three: The Regularity of Service and Efficiency in Recovery are Based onInherent Incentives to Collectors Who are Recyclers:Important lessons learned from informal sector workers in Cairo were transferred to Nuweiba.They were significant to the effectiveness and long term maintenance of the system:The recyclers in the municipal recovery facility cum transfer station were the collectorsthemselves. The NGO Hemaya recognized that breaking up the collection from the recoveryportion of the system is detrimental to successful implementation of cleaning services. Thisaspect is neglected by both government policy and private contractors. This is why collectorsworking for formal companies and municipalities can be seen mining waste on the trucks offormal companies and municipal trucks, leading to a slow down of collection routes and anunseemly collection system which is not much better than the informal one. Thus collectors in theNuweiba model act as public awareness agents who urge waste generators to source segregatemore efficiently when they relax their habits. The collectors are driven by motivations of personalprofit from both sorting cleaner waste and generating more revenues from the recovered unsoiledmaterials.The NGO divides up revenues from the sale of recovered non organic waste with the workers (i.e.collectors cum sorters). This ensures that at no point in the collection and trading system will nonorganic waste ‘leak’ out of the system and protects financial sustainability of the overallenterprise. This is a critical concept gleaned from activities of the informal sector and informs thepractice of successful implementation of town and city wide waste systems in the south.Formal companies and composting plants run by the government have been known to sufferlosses caused by poor sorting or mixed waste at the conveyor belts as workers are paid a fixedwage and do not benefit from the efficient sorting of non organic waste. The organic fractionheaded for composting thus includes more pieces of glass, plastic etc, and requires costlyhandling to bring it up to marketable standard.The Informal Sector in Waste Recycling in Egypt 32
  • 34. The project was based on a stakeholder mapping, and close consultations leading to a partnershipamong the following:1. CID. Consulting2. Association for the Protection of the Environment (APE)3. Hemaya Association for Community Development4. Social Fund for Development, Government of Egypt5. South Sinai Governorate6. Nuweiba Municipality7. The Ministry of the Environment and the EEAA8. The Ministry of Social Affairs9. The Protectorates Department-EEAA10. The Indigenous Population (Bedouins) and the Local Community11. The Private Tourism Sector12. Investors in Nuweiba13. The Media14. Other NGO’s: S. Sinai NGO’s, Cairo Divers, the Roteract and Youth NGO’s2.6.4 Lesson Four: Motivated by Profit and armed with Market Information the InformalSector Recovers High Levels of Industrial Waste all over EgyptCase Study One: PVC Recovery and Recycling20A study conducted for the Egyptian Pollution Abatement Program (EPAP) under the auspices of theEEAA focused on the PVC waste stream and virgin material, the current system of PVC collection,recovery, trading, and recycling in both the formal and informal sectors. It surveyed about 100garbage collectors and traders in Ezbet Al Nakhl, Imbaba, Moatamedeya, Al Baragil, Old Cairo,Tora, and Mokattam. The study concluded that the informal sector is a major actor in the tradeand recycling of PVC waste all over the country. Many small traders buy PVC wastes from garbagecollectors and roamers, and then sell to large traders. Sometimes, small traders and roamers selldirectly the PVC waste directly to the recyclers in specialized PVC recycling neigborhoods Basousand Shubra Al Kheima. Therefore, there is no one way flow of PVC waste, but many different andoverlapping flows and markets of PVC. This is the nature of informal trading and versatility ofenterprise in the informal sector. The survey concluded that the reason this is at all practiced isthat PVC is source segregated by a host of informal actors, primarily because these actors allpossess market information about PVC prices and clients, i.e. its potential to generate income.Although the current recycling activities operate in an informal way and have health hazards andindustrial hazards attached to them, the system recycles about 31% of total consumption of virginPVC, compared to 3%21 of PVC recycling of post consumer waste in the EU. Moreover, the currentsystem employs thousands of people in recovery, trading, and recycling all over the country.Case Study Two: Empty Paint Cans in El Sho’ara, Damietta22, 2003.El-Sho’araa village is a satellite village 4-5 kilometers from Damietta – Egypt’s furnitureproduction center. It boasts nearly half the spray booths and furniture paint workshops in20 CID Consulting, A Study on PVC Recycling, the Egyptian Pollution Abatement Program (EPAP), of the EgyptianEnvironmental Affairs Agency (EEAA), with Finnida, 200321 Vinyl 2010, Progress Report 2002, Mechanical Recycling22 CID Consulting, A Study on Empty Paint Cans in El Sho’ara Village, Damietta, to the SEAM Program in the EgyptianEnvironmental Affairs Agency (EEAA), 2004.The Informal Sector in Waste Recycling in Egypt 33
  • 35. Damietta (40%). El-Sho’araa village had a population of about 40,000 according to the CAPMAS1995 census. The nearest-to-actual number of workshops and spray booths was 2000.A study commissioned by SEAM estimated that these workshops and spray booths produce nearly8 tons of empty paint cans on a weekly basis. Analysis and tracking of empty cans waste routesand streams revealed two main streams: the first moved through a small NGO, the local council,roamers and traders at Damietta dumpsite; and the other moved through roamers, working formiddlemen. The former collect these empty cans from workshops, booths streets and nearbycanals then deliver them to those middlemen/traders who store them in their private warehousesthen sell them to other large merchants in Damietta. These in turn sell them to merchants in MeetGhamr and Mokattam in Cairo. Large cans (10, 16 & 25 K) are sold to pickle shop owners andplant nurseries in the local market in El Sho’araa and Damietta. The study concluded that sourcesegregation of empty paint cans occurs on a voluntary basis – again because the people whoengage in it are motivated by profit and have market information on prices, clients and routes toenable them to trade, process, re-manufacture and even export.2.6.5 Lesson Five: It is Possible to Institutionalize Informal Sector Models of CleanRecovery and Recycling of Institutional WasteCase Study One: Paper WasteThe Association for the Protection of the Environment: In 1992 APE established a communitybased paper recycling enterprise for women in the Mokattam garbage neighborhood. It receivedpaper which had been source segregated in offices in various spots in Cairo. This was clean,unsoiled and ready to be turned into hand made craft paper. It is currently ongoing and employsover 100 women in the recycling process. Paper continues to arrive unsoiled, and sourcesegregated from hotels, offices, businesses and university campuses. The enterprise has beenworking up till now very effeciently , and continues to creatw jobs and generate income for girlsand women.The American Chamber of Commerce: In 1995 the Environment Committee of the AmericanChamber of Commerce (AmCham) implemented a year-long pilot project around the sourcesegregation of office paper among 15 of its corporate members. The scheme succeeded ingetting offices to source segregate paper. It yielded 8 tons of clean, unsoiled paper which was re-manufactured into file folders. The financial feasibility of this project was presented to thechamber members. It was not replicated because it was more appropriate to a Small and MediumEnterprise (SME) audience than to the present corporate profile of chamber membership.Case Study Two: Campus Waste (The Arab Office for Youth & Environment (AOYE): 23The project area covered residences in the southern zone of Cairo in the neighborhood ofMa’asara (320 households) and in Old Cairo (1200 households) as well as on the campus ofHelwan University (800 students in the University hostel + thousands of students and employeeson campus). It led students and university staff as well as residents of Old Cairo to sourcesegregate their waste into two components: food and non-food. This was further classified into:paper, food and all other waste for the University of Helwa. The project raised awareness aroundsolid waste management issues Helwan university and piloted the source segregation of wasteinstitutionally on campus. Organic waste was directed to a composting plant nearby while the non23 AOYE brochures & Informal Sector in Waste Recycling in Egypt 34
  • 36. organic fraction is diverted to a Helwan University recovery center in Basateen. There, secondarysorting takes place on a conveyor belt and tertiary processing by washing, compacting takes placebefore selling to markets of recyclables in the city. Results of that pilot are that sourcesegregation efficiency rates hover around 50-60% and people are motivated to participate as aresult of the awareness campaign and contests organized by AOYE, as well as the provision of theright bins in the appropriate locations.2.6.6 Lesson Six: Informal Sector and Formal Private Sector Interests Converge aroundBrand Name Fraud, 200024Trading of fraudulently packaged products has grown around numerous brand name containers.A thriving market for them is prompted by the inherent revenues to be generated by selling themto fraudulent refillers.25 This has meant that companies producing brand name consumer goodsstand to lose substantial amounts of money from this trade. Not to mention loss of customerloyalty and loss of brand image and reputation. Peculiarity of garbage collectors is that they arenot scavengers. Thus they have clearly identifiable homes, addresses, physical places where theylive, sort, recover and sell the empty containers (in this case shampoo, bath gel, detergent, etc.)Their homes are the repositories of an average of one ton of garbage per day. Their routes areknown and they enjoy a direct relationship with the brand name consumer/wastegenerator/resident in Cairo. The trade in recovered brand name containers has become soorganized and specialized that it has influenced the manner in which garbage collectors sortwaste. Containers with intact labels and lids are sold to large middlemen who live in the garbagecollector neighborhood and who specialize in selling to the re-fillers/wholesalers who use outletsin popular markets to sell the fraudulently refilled items (Game el Ahmar area and Ataba). Thesesell higher priced items as the container can pass more easily for the real thing. Wholesalers sellto the pharmacies and boutiques/stores in low-income neighborhoods.Containers with damaged labels are sold to smaller traders, mostly roamers (sarriiha), who accessthe garbage collectors neighborhoods in search for these items. These roamers sell their lowerpriced products to other smaller wholesalers who fill them with fraudulent products but who sellto the public on the street and in public squares.In 2003 the informal sector recyclers partnered through their NGO – Spirit of Youth (SoY) - withthe shampoo multinationals to beat the fraudulent market by operating as a buy back center forthe empty containers before they left the garbage collectors’ neighborhood. Children who hadbeen deprived of an education were enrolled in the buy back center which operated as amultigrade, non formal school whose curriculum revolved around recycling and granulating therecovered empty containers. Reading, writing and arithmetic as well as computing were wovenaround the empty containers. Learners were paid for each container they delivered to the ‘school’run by the Spirit of Youth NGO in their neighborhood and the two multinationals on board eachpaid for the respective quantity of containers of their own brand that the children had purchasedfrom garbage collector neighbors in the neighborhood. Contracts were drawn between the NGOand the multinational shampoo companies. This intervention could conceivably be used for any24 CID Consulting, Study on Brand Name Fraud. Commissioned by Chemonics/Ahmed Gaber & Associates, June 199825 CID Consulting, Social Development Aspects of Solid Waste Management in Dakahleya. Study commissioned by ENTEC,Consultants to the TCOE of the EEAA, May 1997 and Social Development Aspects of Solid Waste Management in Sohag, byand for the same, August1997.The Informal Sector in Waste Recycling in Egypt 35
  • 37. and all containers which are traded on the fraudulent market for eventual refilling with fraudulentfiller. Examples are perfumes, alcoholic beverages, etc. This would be especially important formedications and drugs as law enforcement and Ministry of Health supervision of health facilitiesare not sufficient to prevent the leakage of these items into the brand name fraud market.Chapter 3: Integration of Informal Waste Workers in Formal Systems: Legal,Institutional and Technical AspectsA discussion of the status of informal waste workers and recyclers in formal systems mustexamine the laws which govern waste management as well as the laws which govern formalizationof businesses, and the laws which pertain to land tenure and ownership of assets in informalsettlements. This has resulted from the informal recylers conglomerating in neighborhoods whichare informal by legal status and nature, and from the fact that the recyclers operate their informalrecycling enterprises in the informal neighborhoods where they live. Thus their activities aregoverned by the laws which govern their trade as collectors, transporters of solid wastes,recyclable materials and final recycled products, as well as the laws which govern informalsettlements and the laws which govern registration of informal businesses.3.1 Solid Waste Management Legal FrameworkThe principal laws and regulations which deal with municipal solid waste management andconstruction and demolition waste are: Law 38/1967 on Public Cleaning and its executive regulations issued by the Ministry of Housing Decree 134/ 1968 Law 4/1994 and its executive regulations issued by Prime Ministerial Decree Law 338/19953.1.1 Other Laws Address Specific Aspects of Waste: Law 48/1982 on the protection of the Nile and its canals from uncontrolled dumping of wastes Law 140/1956 which prevents the obstruction of public thoroughfares Law 84/1968 prohibiting the dumping of waste on roads and in public squares Labor Law 137/1981 Specifics of Law 38/1967 and its Executive Regulations: is the primary law governing solid waste management Article 1 of the executive regulations defines solid waste as garbage, waste and rubbish generated by individuals, residential units, non-residential (such as government and institutional buildings, companies, factories, and commercial entities), slaughterhouses, markets, amusement parks, camps, animal zones, and means of transportation. Law No. 38 of 1961 on the Public Cleanliness amended by Law No. 31 of 1976 and Law No. 129 of 1982 and the Executive Regulations thereof addresses all issues related to garbage and waste collection, transport, the licenses and requirements to protect the garbage collectors, as well as the responsibilities of the garbage-collection contractors. In addition to specifications required for garbage trucks, public dumps and the time schedules for garbage collection as well as other issues related to wastes and unfenced open spaces. Waste Collection and Transport: Article 39 of the executive regulations of Law No 4 of 1994 includes the following:The Informal Sector in Waste Recycling in Egypt 36
  • 38. Solid waste collection contractors shall be committed to the cleanliness of waste, containers andtrucks whose regular cleanliness must be a precondition for ensuring safety and strength of themeans of waste transport. The waste containers shall be tightly covered to avoid emission ofunpleasant odors, to avoid the spread of flies and other insects; or to attract stray animals. Wastesshall be collected from these containers at proper intervals of time according to prevailingneighborhood conditions provided that the quantity of wastes does nott exceed the capacity ofthese containers at any time. The law prohibits the placing of solid waste anywhere except in areasdesignated by the local councils (Article 1, and articles 5 and 16 of executive regulations). Theprohibition also applies to treatment and disposal.Local units shall be committed, through an agreement with the EEAA to allocate areas forplacement, treatment, or burning of solid wastes according to the provisions of this article.The local government authority responsible of the general cleaning or a contractor licensed by thelocal authority to collect, transfer, and dispose of solid waste are required to comply with thespecifications set by the law and executive regulations, as well as those set by the local councils(Article 3 and 5, and articles 5,6,7,9 of executive regulations).If the local authority contracts the solid waste services, the contractor is responsible for theactions of the garbage collectors they hire (Article 8 of executive regulations).The local council is authorized to impose a fee on residential buildings occupants of a maximumof 2% of their rent to fund solid waste management services (Article 8).All fees collected for violation of law 38 as well as the 2% fee are placed in a general cleaning fundestablished by the local council. These funds can be supported by additional funds from thenational budget to ensure adequate levels of solid waste management (Article 9)Owners of vacant land must remove accumulated waste and keep lots clean and the local authorityis authorized to remove solid waste accumulations from a vacant land at the owners expense ifthe owner fails to do so within 15 days after notification (Article 2, and Articles 22, 23 of executiveregulations)Law 38/67 Enforcement: The Minister of Justice Decree 3137 / 1976 identified the following localgovernment employees to have the authority to enforce law 38/67: Governorate housing administrators Governorate health department administrators Town and District councils engineering department administrators Municipal organizations administrators and engineers Governorate or Local Unit general manager for environmental protection Governorate health affairs representative working in environmental protection Physicians of health offices and units in towns, districts, and village units Environmental protection monitors in local units Technical supervisors of cleaning services in local units Supervisors and monitors of cleaning and drainageThe Informal Sector in Waste Recycling in Egypt 37
  • 39. Penalties for the Violation of Law 38/67: These are stipulated in article 9 of law 38/67 as follows:A fine of up to LE100 for violating the terms of the lawThe local authority is authorized to request a violating party to remove wastes deposited in anundesignated area or pay for the costs of their removal. If the violator is a place of business andthe violation is considered a threat to public health, the local authority may ask a judge to seizethe violators business until the violation is removed.3.1.2 Solid Waste Management Specifications Related to Recycling in law 38/67 and itsExecutive Regulations:a. Garbage Sorting (Article 13): sorting is only allowed in designated areas and prohibited in transportation vehiclesb. Land Disposal (Article 17): land must be of sufficient size, easy traffic flow, 250 meters downwind from the nearest residential unit, fenced with a suitable truck access, adequate sanitary facilities for workers, water source suitable for dust control and fire fightingc. Composting (Article 17): a suitable place must be provided for sorting the waste and removing glass, tin, rubber, rocks, and other non-organic wasted. Environmental Law 4/1994: is the principal law in Egypt for environmental protection. Articles addressing solid waste management of law 4/94 empower local authorities to enforce the law and hold them responsible for designating sites for treatment, burning and disposal of solid waste and in coordination with EEAA.e. Article 37 of Law 4/94 and Article 38 of Executive Regulations include provisions prohibiting disposal or treatment of garbage and solid waste anywhere except in an area designated by the local authorities. It also prohibits the burning of solid waste.f. Article 39 of law 4/94 addresses Construction and Demolition waste. A penalty for violating provisions on Construction and Demolition waste is a fine of between LE 500 to LE 1000 and the court is authorized to suspend a violators license or revoke in case of repeated offenseg. Articles 67 and 68 of law 4/94 deal with solid waste management on ships and offshore platformsh. Articles 38, 39 of Executive regulations address general solid waste managementi. Articles 19 through 23 of Law 4 / 94 and Articles 10 through 19 of Executive regulations contain provisions requiring Environmental Impact Assessments of establishments. These provisions apply to solid waste management facilities such as Recycling and Composting plants and Landfillsj. Articles 43, 44 of law 4/94 and Articles 45, 46 of Executive Regulations consist of provisions for worker safetyk. The Minister of Justice Decree 1353/1996 authorizes local government authorities to enforce the provisions of law 4/94. Article 104 of law 4/94 also stated the duties of inspectors in enforcing the lawl. Law 4/94 imposed higher fines on violations related to solid waste management than any other law; however monitoring and enforcement are still weak.m. Articles 86 and 87 of law 4/94 set the penalty for disposing, treating, or burning solid waste in an undesignated area as a fine of between LE 1000 to LE 20,000. Repeat offenders are charged with a fine and face the threat of imprisonmentThe Informal Sector in Waste Recycling in Egypt 38
  • 40. 3.1.3 Other Laws and Regulations:Law 137/1981: is enforced by the Ministry of Manpower and Immigration and requires employersto inform employees of the hazards associated with handling solid waste and provide safetyequipment and training on handling solid wasteHealth Care Hazardous Waste: Medical waste (classified as hazardous infectious waste by Law4/1994) is governed by the national strategy developed by the ministry of Health and the EEAAwhere the code of conduct is set and the related regulations for the safe treatment and disposal ofinfectious wastes are specified. The elaboration of the strategy was funded by Danida. A broadereffort on hazardous waste was completed by EEAA and in cooperation with various ministries onthe classification, characterization and coding of hazardous waste. The program was funded byUSAID.3.1.4 Challenges Related to Law EnforcementEgypt faces challenges related to law enforcement of the above laws, rules and regulations. Someof the reasons behind this are:1. The non-transparent basis of contracting, enforcing of laws, and fining of violators. Currently penalties inflicted on informal sector workers are more stringent than the ones imposed on formal companies. Their lower levels of education make them easier prey for extortion by local officials. Heavy fines are placed on them and their vehicles are often confiscated for real or imaginary offenses.2. Inefficient management of the revenues generated by the ‘beautification fee’ imposed on households, commercial, and industrial facilities3. Lack of management skills among municipal officials, cleaning authorities and environmental monitoring units to manage or monitor complex waste management system4. Fast pace of urbanization and population growth5. Increased role of the active, and more efficient ‘informal sector’ where appropriate management practices are not observed and/or implemented6. Lack of coordination between the official major stakeholders represented by the Ministries of local development, environment, etc.7. The absence of public awareness towards issues of solid waste management and importance of waste avoidance and minimization8. The persistence of improper waste management practices even after private contractors’ assumption of responsibility. Open burning still occurs in some areas in Cairo and Giza; medical waste still finds its way into the municipal stream, etc.3.1.5 Laws Related to the Formalization & Licensing of Businesses26Small industrial enterprises in informal areas have a special legal status which is a related to theinformal neighborhoods in which the subject enterprises are located. Informal areas came intoexistence and became a reality in breach of laws or regulations, as Egyptian legislation hasattempted to regulate jurisdiction incorporating cities and villages with no consequence paid toorganizing or legalizing informal areas. Some have drawn parallels between enterprises ininformal areas with illegitimate children: both need to be legitimated via the ownership of formaldocuments which recognize their existence (birth certificate for the child and registration26 Report by Yasser Hamza to GTZ SME Enterprise Development Program, Cairo, 2006The Informal Sector in Waste Recycling in Egypt 39
  • 41. certificate for the enterprise), i.e. both need to be a juridical person, thus making it possible forthem to exist in society and economy. The juridical person thus acquires a legal milieu to exercisehis activity and can produce a product that is to serve as an expression of existence. Thisnecessitates that this product be made within the scope of legitimacy. Below we present in aschematic format the process required to legalize industrial enterprises in informal areas byaddressing three factors:Establishing a juridical Licensing the Enterprise Licensing the Enterprise person Headquarters ProductTax Registration Card A License by the district The Egyptian Organization to which the Enterprise is affiliated for StandardizationA Commercial Register Industrial Development Authority Approval3.1.5.1 Establishing the Enterprise Juridical Person:Establishing a juridical person for the industrial enterprise located in legitimate areas andoperating within the scope of the various laws shall be determined in accordance with the natureof the subject enterprise:1- An enterprise held in severalty2- A partnership of a number of personsIn both cases and in compliance with the provisions of the Egyptian Commercial Law and theEgyptian Tax Law the features of the enterprise juridical personality shall be determined by thefollowing two matters:1- A tax registration card2- A commercial registerBy obtaining these documents the enterprise shall be a juridical person recognized by Egyptianlaws.Procedures to obtain a tax registration card:These documents are obtained by presenting the following legal documents and undertaking thefollowing procedures: • A copy of the enterprise owner’s personal ID in case of ownership in severalty or the IDs of partners in case of joint ownership.The Informal Sector in Waste Recycling in Egypt 40
  • 42. • A lease contract in which the enterprise’s headquarters address is certified and date of acquisition; this is to be certified at the Real Estate Publicity or a notarized ownership contract. If the enterprise is a partnership, a notarized copy of the partnership contract is submitted. • Electricity and water bills or an insurance receipt for the installation of both services. • A form indicating the issuance of a tax registration card from the competent district office.Steps to obtain a tax registration card: • The enterprise owner or his deputy shall submit the abovementioned documents to the appropriate officer at the competent Tax District Office. • The contents of the subject documents shall be certified and enquiries shall be put to the enterprise owner in a verbal process set for that purpose. • An inspection of the site where the activity is conducted shall be undertaken. • The tax registration card shall be issued within two months.Note: Due consideration shall be made to have the tax review conducted in the presence of anaccountant or a lawyer due to the impact it will have on determining the enterprise forecasted tax.Required documents to obtain a commercial register: : • A request to obtain a commercial register form. • A copy of the enterprise owner’s personal ID or the partners’ IDs in case of joint ownership. • A notarized copy of the partnership contract and its summary. • A Profession practice certificate issued from the Chamber of Commerce. • A copy of the tax registration card.Note: To obtain the profession practice certificate from the Chamber of Commerce the applicantneeds to submit the same documents required for the commercial register.Steps to obtain the register: • The above mentioned documents are to be submitted to the appropriate officer whereby their content is stated in the form set for that purpose. The necessary fees are paid and immediately an official copy of the commercial register is handed. • With the issuance of the tax registration card and the commercial register, the enterprise becomes a juridical person through which it may conduct transactions relevant to its activity with all official and government bodies. Licensing the Enterprise Headquarters:Efforts to bestow legitimacy on the headquarters where industrial enterprises in informal areaspractice their activity poses a hurdle to their bid to gain legitimacy; as informal areas are by natureillegal and lack licensing, hence the difficulty of licensing a part of an unlicensed bigger whole. Ifthe enterprises in question are affiliated to a neighborhood which has been designated as a ruralzone by local government, then they shall be licensed by the local government of the said village;the licensing shall take the form of payment of treasury fees or similar fees and shall not be in theform of official licensing. If the enterprise is located in a informal area affiliated to a district, urban designation, then it shall comply with the ordinary licensing procedures, whereby it isissued with an ordinary license but following special procedures which may be summed in thefollowing:The Informal Sector in Waste Recycling in Egypt 41
  • 43. Documents required to obtaining a license for a commercial or industrial business enterprise: • A copy of the enterprise owner’s ID • A lease contract with certified date or a notarized title deed • An inventory list “A Dues List”. • A Survey map of the area where the enterprise is located. • An engineering drawing of the enterprise; six copies, authorized by a trade union architect wherein is illustrated the horizontal plan and vertical elevation. The drainage system and the power supply shall also be outlined. • A letter from the Social Insurance to insure the enterprise owner. • A copy of a notarized company contract if the enterprise is a partnership. • Regular and engineering stamps. • A receipt indicating payment of licensing fees. • A hygiene certificate if the activity practiced is related to food. • The approval of the civil defense authorities relating to industrial safety. • A utilities bill - water or electricity.The enterprise approval is to be prepared as a facility and not to be part of the estate utilities orone of its residential units.How to obtain a license? • The abovementioned documents shall be submitted together with a licensing application to the district or the village local administration to which the enterprise is affiliated. • An inspection of the subject site is conducted to verify the absence of any violations. • If the site is free of any violations, the district issues a license confirming practice of the subject activity to be followed by the issuance of a final activity license. • If these procedures and documents necessary to obtain a license for an industrial or commercial enterprise are submitted and the district does not issue a decree of acceptance or rejection of the license application within sixty days from the date of submission this shall be regarded as an acceptance decree in compliance with the law.Note: The legislator has in the recent times devoted due attention to small enterprises, thusprompting the issuing of Law no. 141/2004 on the development of industrial enterprises; thesubject Law has been followed by a number of executive decrees, the most important of whichare:By virtue of the Presidential Decree no. 350 for the year 2000, the Industrial DevelopmentAuthority was established; the second article of the said decree stipulated that “approvals andlicenses for setting up industrial projects outside authorized industrial zones shall be issued incompliance with the terms and procedures determined by the board of directors”The Ministerial Committee meeting at 5/12/2005 issued decree no. 3/13 which stipulated that nolicense shall be granted to set up any new enterprises outside the authorized industrial zonesunless the said enterprises were operational before 5/12/2005. Although most recyclingenterprises were established prior to that date, yet the hurdels placed by local authorieisa dnenvironmental units remain insurmountable. The backdrop to this ia a huge government effort toestablish one stop shops for the registration of businesses in the formal economy. Informal sectorThe Informal Sector in Waste Recycling in Egypt 42
  • 44. enterprises, recycling and otherwise – have no access to these newly established facilities theMinistry of Investment has established.Acting on the above mentioned, the only two bodies considered exclusively competent to grantlicenses to industrial enterprises in informal areas are: the district or the local unit to which theenterprise is affiliated.The Industrial Development Authority (Ministry of Industry): the documents to be submitted andthe terms to be met to obtain the Industrial Development Authority approval to grant the license,are as follows: • A condition that the project shall have started before 5/12/2005 • District license • Commercial Register • Civil Defense approval • The Environment agency’s approval • Partnership contract • A letter from the State Lands • The documents shall be submitted on form no. (1) authority, approval shall be issued with the completion of the said documents.Once the enterprise fulfils the above mentioned it can be legally eligible to practice its industrialactivity, the aforementioned documents if required to obtain the Authority approval of licensing,are also required to obtain an industrial register for the enterprise as shall be indicated thereafter: Licensing the Enterprise ProductOnce the enterprise acquires a juridical person, and its headquarters has been licensed, itbecomes imperative that it practice the activity for which it acquired the juridical person andestablished headquarters. As the enterprise practices an industrial activity it is natural that itshould manufacture a certain product. In order for that product to be legal it must fulfill specificterms foremost among which are: • The enterprise shall have an industrial register. • They shall have an approval of the Egyptian Organization for Standardization.First: How to Obtain an Industrial Register:The industrial register can be obtained from the Industrial Development Authority whoseheadquarters are at El Khalil Agha st. Garden City. The documents required to obtain the saidregister are as follows: • A document indicating the project was operational before 5/12/2005 (electricity – water bill - insurance) • A commercial register. • A license to practice issued by the district. • Civil Defense approval. • The Environment Agency’s approval. • Partnership contract if any. • A Letter from the State Lands indicating approval. • A power of attorney from the competent person or his ID.The Informal Sector in Waste Recycling in Egypt 43
  • 45. When these documents are submitted along with the appropriate form, following the verificationof the tendered documents, the industrial register is issued.Second: The Egyptian Organization for Standardization and Quality ApprovalThe Egyptian Organization for Standardization and Quality was set up by a Presidential decree no.329/79. It is the body competent for setting, issuing, amending and abolishing Egyptianstandardization for the various products. It determines the eligibility of enterprises to producedifferent products by issuing certificates indicating the manufactured products compliance withspecified standardization. The owner of an enterprise shall undertake the following steps to obtainthe abovementioned certificate: • Specification of the industrial product: agricultural – chemical – engineering, etc. • The ingredients of which the product is manufactured shall be submitted. • The said ingredients are tested and if in compliance with the standardization, the competent person is issued with the aforementioned certificate.Following the issuance of the certificate, the product is manufactured and a sample of it isdelivered to the Organization for verification and so the product shall be eligible for circulation.The enterprise owner can become acquainted with specifications of the product which he willmanufacture by obtaining a handbook of the specifications from the Organization premises at thedistrict office Cairo.With the fulfillment of the above elements, the enterprise will enjoy the status of being a juridicalperson in the technical sense of the word; the said person may represent himself before thebodies concerned with dealing with him and tackle all bureaucratic hurdles without fear of beingruined by them.Conclusion:The issue of legalizing the status of small industrial enterprises in informal areas is extremely vitalbut at the same time extremely complicated due to the multiplicity of procedures and thestipulations relevant to licensing small industrial enterprises in general. Consequently, if anenterprise seeks to legalize its status it needs to undertake a thorough review of its legal statusand have full knowledge of all the various dimensions it will have to address in order to be able tonavigate through the three factors mentioned above. These factors are vital to the creation of alegal industrial enterprise. In case of a dispute preventing the enterprise to obtain the necessarylicense the State Council Administrative Court shall have the competence to decide the matter.The following chapter will discuss the legal reality as it relates to informal sector recyclers. This isa particularly significant aspect of the research around integration and formalization of theinformal recycling workers.Chapter 4: Assessment of Integration Process of Informal Waste WorkersThe previous discussion on the various initiatives undertaken by various actors demonstrates thatnon profits, donors and consulting firms, have worked long and hard to develop models, to testinterventions and to mobilize informal recyclers at the local level, etc. Yet little energy wasdirected towards forming a coalition of all NGOs representing informal sector workers in a nationalThe Informal Sector in Waste Recycling in Egypt 44
  • 46. syndicate or union. Other countries, such as Colombia, Brazil and Peru have focused primarily onchanging legislation, policy frameworks and regulations and have achieved significant rights forworkers in the informal recycling sector. But in Egypt, the general climate did not lend itself to thatkind of approach. Instead, actors who continue to be involved in the quest to integrate informalwaste recyclers are now testing approaches along the following lines:4.1 Awareness and Information DisseminationA year-long effort with one of the recycling neighborhoods (Ezbet El Nakhl) was supported byGTZ’s Small and Medium Enterprise Development Program. It included plastics recyclers only andundertook a series of interventions through a variety of partners, such as: the Plastic TechnologyCenter based in Alexandria, CID Consulting, PREMA Good Housekeeping institute, lawyers,municipalities, other NGO’s (SIMA in Alexandria), etc. The project organized meetings, informationsessions, field visits to large plastic recycling industries, attendance at fairs and exhibits,attendance at conferences, participation in specialized workshops, presentations made by lawyers,invitations to municipal heads to discuss formalization, contacts with Egypt’s Social Fund forDevelopment (SFD) to explore alternative ways of formalizing recycling SME’s, etc.Copies of the small industries development law #141 for the year 2004 were distributed to a coregroup of recyclers as well as copies of the steps and procedures of registering the smallworkshops through the SFD of Egypt, whose role according to the law #141 for the year 2004 is toassist small workshops and industries in registration and legalization as well as to upgrade them.To register at the SFD, every owner must submit a proof of having paid real estate taxes from thedistrict council or the city council in addition to proof of having covered workers with socialinsurance payments, as well as a rough plan of the workshop and the commercial register in orderto be able to apply for a small business identity number from the SFD. Decrees regarding theissuance of small business identification for small enterprises are found at the IndustrialDevelopment Center, which is affiliated with the Ministry of Industry. Most recyclers do not knowthat this center exists, what its functions are, its location in the city, how to approach bureaucratsthere and what to ask for, or how to pursue the process.4.2 Actions towards Formalization of Businesses4.2.1 Registration through Local AuthoritySteps towards formalization had taken place but with woefully disappointing results.A Case Study: The recyclers of one neighborhood in Cairo invited the head of their local citycouncil to a meeting in their community center and informed him of their intent to submitcomplete dossiers in application of formalization. He expressed enthusiasm for the plan andinvited them to come as a large group to do so at his office in the local city council. Ten recyclersprepared their dossiers but were sent home as the council head said they were too few andencouraged them to come back with 30 dossiers. A month later twenty nine (29) recyclerssubmitted their dossiers. A month later, when they had not received licenses for their workshops,they were told that the city council had raised the dossiers to the governorate level and that thefiles were held up in the bureaucracy there. Weeks later, when the recyclers approached thegovernorate, they discovered that the files had never left the local councilman’s office and thatthey had become marked as workshops open to fines and violations for having unlicensedbusinesses!!! Officials from the local council had made it a monthly event to venture into theneighborhood, fine these specific workshops and others for a variety of violations: beingThe Informal Sector in Waste Recycling in Egypt 45
  • 47. unlicensed, not compling with environmental regulations, not complying with industry safetystandards, obstructing traffic by placing large bales of recyclables on the street, etc. The contextof these violations is a neighborhood where the current sewage system is so inefficient that it isnot uncommon for streets to overflow with effluent, where roads which had been paved once havebeen ruined by the continual overflow of sewage, where street lighting is so scarce and wheremunicipal services are virtually non existent.Thus integration through registration of businesses faces seemingly insurmountable obstacles andneeds to be the focus of government, civil society and private sector action in the coming years.4.2.2 Recourse to Registering with the SFDProcedures adopted above were governed by a law which was drafted specifically (Law # 141 of2004) to shorten and facilitate the registration procedures for informal workshops. This met withlimited success as fears of delays by the SFD meant that the recyclers would now be subject totaxation without enjoying the protection from extortion by municipalities.The process adopted by the SFD required applicants to present official documents to the local SFDoffice. Upon completion of the file, the SFD issues SME owners a national Small Business I.D.number and card which serves as protection from would be extortionists. This I.D. serves as a firststep towards the complete formalization process. The SFD coordinates with the local units tofinalize the registration procedures. These I.D. numbers are considered an official and legalacknowledgement from the government that these workshops are legal till they issue the finallicenses from the local units.Some of the advantages of the SFD small business I.D. are the official recognition by thegovernment of the informal sector workshops until they complete the full formalization process,the ability to access credit through the SFD, a tax holiday for 5 years for loan recipients, andconceivably negotiate for a fair and appropriate relocation to one of the newly designatedindustrial zones. The collective registration of a large number of informal sector recyclingworkshops under the government’s SFD might lead to an implementation of the complexrelocation, formalization, upgrading and registration which is currently faced with innumerablebarriers and challenges.One of the licensing problems with the local units is that each workshop must have anenvironmental register before starting the licensing process. This register is to be issued by theenvironmental administration. If the licensing procedures and the SFD stopped for any reason,recyclers fear facing anew the harrassment via violations and sanctions from the local unitemployees. They also fear that if they issued the tax ID and the commercial register but forunforseen reasons the licensing process stopped, accrued interests on taxes and social insurancearrears would place a heavy financial burden on them. In short, a huge uncertainty surroundingoutcomes of actions leading to formalization and limited confidence in the smooth process withingovernment bureaucracies places enormous barriers towards their integration.More benefits of the SFD national number for small industries can be aspired for:1. Government must purchase 10% of the workshops production through a supplier/provider enrollment/registering request.The Informal Sector in Waste Recycling in Egypt 46
  • 48. 2. 10% of the tenders and the governmental purchasing orders to be given to the small enterprises.3. Small enterprises sales amount to be exempted from taxes.4. 60 % of the small enterprises sales amount to be exempted from taxes according to value added to the small industries.5. As for the inspection, according to article # 12 of the small enterprises law, the inspection authorities must inform the SFD with the inspection timings and programs and inform the small establishment with a copy of the inspection report.6. The industrial modernization program in the industrial federation provides a 10% non refundable grant of the value of the machines of the factory or the small workshop.7. The advantage of participating in fairs and exhibitions8. Opening new channels for local contracts and export as well.9. The national number of the SFD saves 80% of the training costs needed by the small industries workshops to train its workers on the recent and latest technologies.4.2.3 Fear of TaxationAmidst fears of randomly valuation of taxes, retroactively charged of workshops licensingprocesses are viewed with apprehension and distrust. Insufficient and inaccurate information onthe current tax system plagues the sector with the inability to take decisive actions towardsformalization. Some believe that taxes are assessed retroactively back to the date of theacquisition of an electric meter. If so, they argue that this would be extremely prohibitive as theyhave been operating for 10-15 years. Others say that a recent law assesses taxes on businessesand yet others point to the well-publicized new law which places a 20% flat fee on all corporatetaxes and ignores all payments due to the tax authority prior to 2007. Some cite the advantage ofobtaining the SFD small business I.D. as it places recyclers in lower tax brackets than large formalenterprises. The government designed this tax structure in recognition of the large employmentgeneration potential of the SME sector and as a desire to promote it.Yet actual steps to implement that process face serious challenges when it comes to informalSME’s trying to register and formalize.4.2.4 Complexities of Formalization of Land TenureInformal sector recyclers live and work in neighborhoods which were either government ownedland or on what was previously agricultural land whose owners subdivided and sold to currentresidents. Houses were built without licenses, neighborhoods grew without adequate planning,and have now become small residential and recycling industrial zones, marked by informality.Mokattam Recycling neighborhood in Manchiyet Nasser is located on a limestone hill which wasquarried up till recently. The present recyclers were evicted from five previous locations anddirected by the governorate of Cairo to settle on that barren hill in the early seventies. Instead ofsettling close to the main road, they settled deep into the gorge of the hill in order to avoid furtherevictions. This strategy has served them well. They are now nestled between one of the largesturban slums in Cairo (Manichiyet Nasser) and the Mokattam Hills. The homes they built withoutofficial permits provide waves of local municipal workers with illicit income – a feature of allinformal settlements in the world.The Informal Sector in Waste Recycling in Egypt 47
  • 49. To compound the complexities of integrating informal sector recyclers, informality of land tenurefor informal sector recyclers and the changing face of the city affects further their insecuresituation. In Ezbet el Nakhl recyclers’ neighborhood, the classification of their neighborhood as arural area changed to an urban one in 2008. This meant that they were now the fortunaterecipients of a local city council with a full structure and staff meant to provide services at thelocal level. However, as presented above, the existence of municipal institutional and physicalstructures closer to neighborhoods does not necessarily lead to improved conditions and/orfacilitation of resolutions of urban issues for residents. On the contrary, in the absence oftransparent governance measures and poor accountability measures for local government, peopleare left wide open for extortion by local government officials. Random violations are regularly filedby the environmental unit employees, who periodically visit informal settlements and fineviolations and sanctions against some workshops. Standard responses by workshop owners are tobribe their way out of the situation or pay and get an official receipt for the fine paid. In eithercase, municipal workers stand to profit financially: in the first instance, directly and in the secondindirectly as their end of year bonus is tied to the local municipal revenues they raise throughfines and violations.4.2.5 Cooperating with the Industrial Modernization Center (IMC)This center was funded by the European Union through the Ministry of Trade and Industry. It offersassistance to SME’s that are legally registered. The IMC is a new actor in the waste sector and isrelated to the Federation of Egyptian Industries (FEI) which has members in the formal industrialsector. It is divided by industrial clusters. One of these is the Plastics Sub Group. This sub grouphas recently taken an interest in the informal plastic recycling sector. New actors emerging on thescene of waste and recycling are the Chambers of Plastics, Glass, Metals, Paper and Cardboard inthe Federation of Egyptian Industries. As prices of virgin materials rise on the global market, largeindustries in the recycling market have become interested in forging alliances with the informalsector. They are poised to create a paradigm shift in the formalization of recycling SME’s and thetechnology of small entrepreneurs as well diverting current final products towards the market ofsafer consumer products. An Experiment Linking Neighborhood Urban Upgrading, Land Tenure,Licensing of Waste Services, Recycling Activities and Resettlement of ‘Waste SortingActivities while Maintaining Rights to ResidenceWhen the government announced plans to privatize the waste management services of the city ofCairo, the two NGO’s active in Mokattam (A.P.E. and AGCCD) jointly approached the governor’soffice to explore how the informal sector workers could be integrated in the new system. Sincenone of the board members of A.P.E. were from the neighborhood, it did not have therepresentational strength to claim to represent the neighborhood. Since almost all members ofAGCCD were from among the stronger and wealthier factions of the neighborhood, they reducedtheir negotiations to limited personal interests and were not successful in taking the discussion tolevels which addressed system wide design to include the entire sector, instead of just theirimmediate neighborhood. They were tempted by an offer of land and relocating to an area 60kilometers outside of Cairo where they were to be given land for warehouse/workshop space. Theywere to keep their current homes in Mokattam as residential places only and would commute tothe new location on a daily basis to undertake their sorting, processing, animal raising and tradingactivities. Promises of infrastructure and secure land tenure were made. Coming from abackground of repeated evictions and having established themselves informally on what hadThe Informal Sector in Waste Recycling in Egypt 48
  • 50. become prime land in the city of Cairo, they saw potential profit from the ownership of land andthe eventual expansion of Cairo to overtake their newly designated neighborhood. Theycompromised the effects this relocation would have vis à vis the distance to the source of waste(homes of Cairenes and commercial waste generators), access to markets and market information,as well as the increased transport cost for them and for their trading clients. The risk takers in thecommunity ventured out and hastily began constructing workshops. Soon, problems arose overland ownership and all further implementation of the scheme was halted as opinions variedregarding whether the land belonged to the military or the governorate of Cairo. Those who hadcommenced construction had no recourse to recover their losses. The matter is still pending today(2008).This incident led to a serious erosion of trust between the informal recyclers and theirorganization – AGCCD. Meanwhile A.P.E. had successfully implemented the precursor to thisproposed move through a community based integrated development plan to upgrade 24 acresconstituting a home for 158 families of garbage collectors/recyclers in Tora, a settlement wheregarbage collectors/recyclers lived in the southern zone of Cairo and adjacent to a high incomeneighborhood – Maadi. Similar to the Mokattam garbage collection settlement, it was a squatterarea resulting from one of the series of forced relocations ordered by officials to accommodate thegrowing city and to keep it served by the traditional collectors as no substitute system had beendesigned to handle the mounting volume of residential wate. A.P.E.’s legal point of reference wasthe most recent law on informal settlements which stated that residents on land acquired prior to1984 can secure the land and obtain tenure. However polluting activities had to be transferred tothe desert. This justified people remaining in their homes if these became residences only whileall recycling activities (organic and non organic) were moved out of the city limits.APE established a Sorting and Recycling Center in Kattamiya on a 25-acre site at a distance of 19kms from Tora which was designated by the governorate of Cairo. It consisted of 62 individuallyowned recycling units, a veterinary center, a compost plant and plastic waste recycling workshop,as well as a factory for the production and maintenance of waste recycling machines. The “Toraplan” was a compromise which sought to avoid yet another forced eviction of the informal wasteworkers from their informal neighborhood. APE mediated between the community and thegovernment to halt the eviction and instead have residents participate in upgrading theirneighborhood. They adhered to street widths, whitewashed the facades of their homes, improvedhousing construction (from ramshackle tin and cardboard shacks to brick structures) landscapedstreets, became the recipients of a government public works scheme which installed water andsanitation networks. In return, the recyclers were directed to move their waste sorting and animalbreeding activities to Kattamiya.The government had granted APE the right to use but not own the land in the new site in order toassist in implementing the alternative to the earlier planned forced eviction. APE subdivided plotsand raised financial and in kind support from the private sector to upgrade the plots by providingwater, tiled space for easier cleanliness and an outlet for pig manure. It had relocated itscomposting plant which had years earlier (in 1984) been established by APE in Mokattam. Thuspeople, animals, composting plant and new infrastructure all cropped up on the barren Kattamiyasite on a promontory overlooking a petrified forest which had been designated as a protected areaby Egypt’s Ministry of State for the Environment.The Informal Sector in Waste Recycling in Egypt 49
  • 51. Meanwhile access to the homes of Maadi residents was now threatened. Maadi is the upperincome neighborhood which the “Tora collectors” had served and which provided the main input tothese recycling activities. The traditional collectors had been obtaining licenses to serve theneighborhood through the traditional licensing procedure which had served the zabbaleen fordecades, through the local branch of the CCBA in concert with the local municipality. This wasnow threatened. Waste workers could no longer use donkey carts to reach the farther and steeperKattamiya site. Unlike the Mokattam waste workers, they had no time to develop quick and readyadapative strategies or means to finance the purchase of trucks. Thus the service to the highincome neighborhood of Maadi faltered and cleanliness levels declined. As a corrective measure,the Maadi local council ‘tendered’ the waste services of the neighborhood to private contractorsand an Egyptian firm won the ‘bid’. This age old method of squeezing the informal sector wasteworkers out of the market and their trade worked only partially. As with so many otherneighborhoods in Cairo, many private companies find a ready and free pool of labor among thezabbaleen. Monitoring agencies in municipalities were, and still are, building their capacities toimplement rigorous monitoring of waste contracts and ensure that residents receive an efficientcleansing service. Thus the field was wide open in Tora, as it is today in all of Cairo, to informalarrangements being entered into between the private contractors and the informal waste workers.Since the private contractors receive their fee for service from the municipalities and not fromresidents, they are ensured of their revenues and do not need to recover their cost from recycling.Furthermore, Egyptian private contractors are mostly hauling companies with little or noexperience in waste management. They are not motivated to recover or recycle waste. Thus theinterests of the informal recyclers in accessing waste converged with the interests of the privatecompanies in reducing labor costs (the zabbaleen offer their labor free just for the right to accessthe waste in people’s homes!) and in reducing tonnage of waste having to be transported to themunicipal dumpsites. Residents are happy to have the same familiar service provider access theirbuildings and receive door to door service on alternating days. However, as with all informalarrangements, system efficiency cannot be guaranteed by clandestine arrangements. Irregularmonitoring campaigns by the municipality, as well as eventual disagreements between privatecontractors and informal waste workers led to an erratic and interrupted service. And to add insultto injury, collection crews hired by the private companies who also belonged to the poorer classes,soon found it expedient to either extort money from the informal waste workers or to share in thespoils of their trade! Since Maadi is home to a large foreign community and wealthier Egyptians,waste on the streets causes great displeasure but neither foreigners nor Egyptians find aresponsive actor in the local municipality.This is the story of waste management in the large megalopolis of Cairo: a city which is bursting atthe seams and which is home to an estimated 19.6% peope below the poverty line in 2004/ 2005according to the Egypt Human Development Report 2008 and 40.6% in 2004/ 2005 according tothe African Economic Outlook 2007/2008. In focus groups with recyclers around Cairo, the Toraexperiment was assessed and found to be unappealing. Interviews with recyclers indicated that ifa number of measures were in place, they would reverse that view. These measures are: Secure land tenure in the new proposed location Credit to assist in constructing safe, solid workshops which adhere to industrial standards. Infrastructure to allow them to maintain sorting of waste (space) processing (power, water and special drainage systems for industrial effluent) Access to markets (roads)The Informal Sector in Waste Recycling in Egypt 50
  • 52. Freedom from current arbitrary fines and violations imposed upon them by local city councils and Environmental Monitoring Units Support in licensing their businesses and compliance with the new user friendly tax laws. Business support services linking them to large scale formal recycling industries Technical support services in upgrading their technology and industrial processesChapter 5: Lessons Learned, Conclusions and RecommendationsThus the battle was and is still fought on many fronts: On one front are the needs of cities toprovide cleanliness services to residents and protect public health. On another are the needs ofinformal sector service providers who have developed expertise in some areas but who still needto be upgraded in others, to continue to serve residents to meet the public health needs withoutthemselves creating other public health hazards to themselves or to portions of the city. Thisneed includes their freedom from harassment, their formal recognition as contracted serviceproviders and the monitoring of their activities to ensure compliance to health and safetymeasures. On a third front are municipalities’ needs to monitor waste management systems in thecity while maintaining transparent contracting and monitoring methods, and to manage localneighborhoods without resorting to extortion and eviction measures. On a fourth front, largecities in the south have been unable to stem the tremendous influx of rural migrants or theunprecedented growth of informal settlements.The issues thus touch upon complex and interrelated aspects of urban management of cities –spatial, social, economic and political – and on waste management systems which include thepopular economy, on industry upgrading and the preservation of small enterprises which generatejobs for the millions of unskilled and semi skilled youths in the city, and on transparencymeasures in governing cities and neighborhoods along with upgraded methods of participatorycity planning. A greater involvement of urban planners, waste management specialists,government officials, NGO’s, SME business development providers, technology innovators, socialscientists, and the business sector is required to tackle these aspects.Since the interventions designed by NGOs to advocate for ‘rights’ in the waste sector did not seemto yield tangible results, but rather led to a situation where doubly informal arrangements are nowembedded in the seemingly formal system of international contracting, representatives of theinformal sector recyclers are now testing interventions with the large formal sector recyclingindustry. Efforts to formalize SMEs over the past two years have met with barriers to that processat the local level and the difficulty of penetrating local municipal structures to obtain licenses forrecycling workshops. Efforts to maintain access to the waste collection activities which are thepipeline to the entire recycling system are threatened on a continual basis by the advent of havingto operate informally through Egyptian private companies and international companies. Exportingrecyclers from among the informal sector have now been hit with a tax imposed on waste whichhas not enjoyed value added processing and while they do process the waste before directing itfor export, yet the interpretation of the law at local level has obstructed their exporting activities.Since they were not part of the discussion on the setting of the new tax, they view the largerecycling industry with suspicion particularly since the price of virgin plastics has spiralled andlarge recycling firms are searching for an ever growing supply of local, recycled plastic. Thus, thecurrent trend among informal recyclers, consulting firms and donors is to explore theThe Informal Sector in Waste Recycling in Egypt 51
  • 53. effectiveness of a partnership between these large industries and the smaller recyclers. Thismight lead to a number of things:• Large recycling firms who are organized in business associations and federations would use their clout to assist recyclers in licensing their businesses and in upgrading their industrial and business processes.• Small recyclers in the informal sector would engage with the large recycling businesses in the national around the recycling sector, from the most basic aspects of waste collection from homes to the most complex of relocating to industrial zones specifically designated for upgraded SME recycling workshops.• Large businesses would be forced to scrutinize the whole gamut of the current waste cleansing system: from waste collection, licensing, legal aspects, privatizing cleansing services, etc.• SMEs would provide large industry with recovered and processed materials according to industry specifications, thus circumventing, to a larger measure than is now practiced, the consumer good market and the brand name fraud market.One of the proposed schemes to integrate the informal sector recyclers has been the onepresented by the Plastic Technology Center (located in Alexandria) and emanating from theMinistry of Industry as a Business incubator and self financing cost recovery center for businessdevelopment for the plastics industry in Egypt. This center has begun drafting Egypt’s NationalStrategy for Plastic Recycling. The aims of this strategy are: to organize and institutionalize theEgyptian Plastic Recycling Sector; to enhance the harmonization between both the plasticsrecycling sector and the plastic industry sector ; to attract local and foreign direct investment tothis sector; to create an inclusive sector which combines economic with social development goalsfor Egypt.These aims constitute a belated recognition of the importance of the informal recycling sector inthe national plastic recycling industry of Egypt. Although it addresses plastics only, yet it is awatershed recognition as it is anticipated that other recycling industries will follow suit, once theplastic recycling national strategy has been concretized. The strategy document estimates thatEgypt generates 16 MT/ Y of MSW of which 6% (by weight) are plastics, i.e. 970,000 tons. It statesthat informal recyclers recover around 30% of that tonnage, i.e. 290,000 MT/Y of Plastics, of which21% is exported. Thus the informal sector recyclers have come a long way from the rural migrantfarmers who came to the city of Cairo 50 years ago: They are now recognized as a significantactor in Egypt’s export market . And, the strategy goes on to include the lowest household wastecollector in its estimate of people employed in that recycling sector (more than 130,000 personsin the Greater Cairo area alone). This inclusion is tantamount to a consciousness of the first link –the garbage collector - in the long chain of materials flow from waste generator to export market.The inclusion of the informal sector in the long chain of recycling activities is believed to be abetter mechanism for compliance with safe product standards than the hard-to-achievemechanism of policing informal sector recycling manufacturers.The strategy also addresses thebrand name fraud aspects of recycling .The Informal Sector in Waste Recycling in Egypt 52
  • 54. If the National Plastic Recycling Strategy is implemented it will link actors in the recycling sector tothe Ministry of Trade and Industry, Egyptian Organization for Standardization and Quality, theMinistry of Environment and the Industrial Development agency. These agencies are all currentlyoutside the reach of the informal sector, thus formalization, with all its uncertainties, might leadto more equitable integration of the informal sector recyclers.Market development instruments which would affect the sector would include targeted programstowards the upgrading of the performance of recycling operators. Such programs would beimplemented by governmental and non governmental actors and could be funded by donors.Conceivably, loans and incentives could motivate recyclers to upgrade their recycling businesses.The Informal Sector in Waste Recycling in Egypt 53