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Financial management of waste management systems in developing countries

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Globally, developed and industrialised countries are considered responsible for waste production. Although developed countries produce more waste materials, they are also economically stronger for waste management than developing countries. Developing countries such as Nepal have to spend a lot of money on different functional aspects of waste management.

Financial perspective

Various issues emerge as barriers to proper and sustainable waste management in developing countries. One of the major problems is poor and unstable financial conditions. Developing countries like India, Bhutan, Bangladesh, and Nepal are financially poor and not stable and are not capable of managing waste properly as a waste management process requires good financial resources. A proper waste management system requires good technical experts, good resources, good planning, and coordination with other stakeholders like those working on the issues of roads, drainage, transportation, telecom, and electricity. All these things are possible only when good financial resources are available. Less economically developed countries or developing ones generally suffer from improper waste management.

Cities in low-income countries with GDP under 1,000 USD per capita, including Lusaka, Dang, Dhaka, Bamako, Moshi, Birgunj, and Nairobi, are still struggling to provide adequate waste collection and street sweeping services to their citizens. In their efforts, they are partnering with diverse stakeholders, ranging from the private sector (which is often not interested), community-based organisations (CBOs), and the informal sector and their associations, with varying success.

Factors leading to financial unsustainability in developing countries

Most of the developing countries are now facing the problem of rapid urbanisation. Especially Bangladesh, India, and Nepal are facing this problem, along with population growth. Hence, financial resources are invested elsewhere and for various administrative costs, infrastructure development, industries, hospitals and so on in this region.

It is predicted that, by 2025, the Asian urban population will reach 50% of the total population. Similarly, as population increases, sanitation in these countries gets slow and there will be a wasteful condition, resulting in various health implications. Poor sanitation facilities lead people to be infected from various kinds of communicable diseases. Also, most of the developing countries do not have sufficient hospitals, enough to serve the increasing population, the members of which get infected by various diseases caused due to improper sanitation.

The World Bank reported that about 2.5 billion people were not using good and proper sanitation facilities in 2008. People are suffering from environmental contamination and various microbial infections. As many as 863,000 deaths were recorded in 2008 across the world due to malarial infections (Imad A, 2011).

Another factor leading to financial unsustainability in developing countries is the lack of proper management of government budget and unsystematic financial records. Political instability can also be considered as one of the major causes in countries like Nepal, Pakistan, and some African countries.

Financial difficulties in waste management

In most of the developing countries, solid waste management is given a low priority as they are still struggling to meet people’s basic needs. The weak financial basis of these countries is providing hindrances in solid waste development.

Also, if the services are provided relating to solid waste management, the service users are unable to pay or deny paying for the services. In the same way, the local tax system is not adequately developed. Most of the people except in major cities of developing countries have moderate economic conditions and some are poor and too poor as well. The willingness to pay for the service is also another factor to be considered. The willingness to pay for the service is ineffective in general.

File: Waste piles up at UN Park in Lalitpur.

The lack of financial management and planning depletes the limited resources available for the sector even more quickly. This delays solid waste management. One of the major problems in developing countries is that is there is no good financial management and planning. Also, the annual budget allocation for the sector is weak. Corruption is another major problem. Political instability is wasting much precious time and money in these countries.

Financial sustainability

The evaluation of financial sustainability is very much important, but it is a complicated task. A country can establish a proper and sustainable waste management system only if sustainable financial conditions favour. Otherwise, the country suffers from debt, as well as has to depend upon donors. As a result, waste gets piled up for many years.

As viewed by many scholars, solid waste management is not only a single service. It involves the process of collection, transport, resource recovery, processing, and disposal. All these activities demand financial sustainability and the country has to be financially strong.

Various studies have shown that Americans alone are producing hundreds of millions of tons of waste per year. And, both the government and environmental associations have developed numerous methods dealing with this problem. According to the material recovery statistics of the US from 1960 to 2017, in 2017, some 94.2 million tonnes of materials in waste were recovered from municipal solid waste streams (T.Twang, 2019). It means developed countries are ahead of developing countries, in both production and management of waste. It, however, can be a problem in the developing countries including those listed below:

These countries are facing the problem of waste management with major adverse impacts on public health. For example, managing municipal solid waste has been a big problem for South Sudan for the past few years. Juba city in South Sudan is considered to be the most problematic city in terms of municipal solid waste management. South Sudan also considers low capital or financial resource as one of the challenges in the waste management system  (Manya, SeyoumLeta, & Khan, 2017).

Many studies show the economic situation in many developing countries has deteriorated considerably in recent years. Between 2010 and 2014, aggregate GDP expanded at an average pace of 6.0 per cent, but growth slowed to an average of 4.2 per cent between 2015 and 2018. The slowdown in growth has been particularly pronounced in Africa, Latin America, and Western Asia. In 2019, average GDP growth in developing countries could fall below 4.0 per cent, amid lingering fragilities in Argentina, Brazil, and South Africa, and weaker economic conditions in Mexico, Saudi Arabia, and Turkey. There are many reasons behind this trend, including the knock-on effects from the collapse in commodity prices, the Covid-19 pandemic, protracted domestic weaknesses, and, in many cases, deteriorating investor and consumer confidence due to policy uncertainties. For many developing countries, the escalation in trade tensions has dampened export flows.

Developing countries are carrying out waste management activities on their own, but are also developing various strategies to get funds from various donor countries in the world. But, as shown by various studies, the initiatives have been weak and ineffective.

This does not mean that all the developing countries in the world are stepping backwards in solid waste management; there are still many examples to show progress.

Challenges in waste management in developing countries

Some developing countries like Nepal are facing the problem of slow economic growth. Slow growth in the economy not only makes the country poor but also highlights structural factors, which include limitations in their innovation and technological capabilities. It is creating problems in the innovation process. Innovation is the key factor that drives transformation and gives new methods, meeting new requirements and needs of the country.

Another factor is the hindrance in the creation of education and awareness among the uneducated and unaware people in and around different parts of the country. Problems in the purchase of recycling and other waste management equipment also exist in poor countries.

File: A PPE set being sewed in a workshop in Kathmandu.

The next is a lack of sufficient PPEs for the waste handling personnel. Due to the lack of PPEs for waste collectors and other landfill workers, they cannot provide their services to the public during emergency situations like the Covid-19 pandemic.  Many waste collectors have been tested coronavirus positive around the world.

Another challenge is the unavailability of technical experts in the field of waste management. Also, many waste workers in countries like Nepal and India lack technical skills relating to recycling processes and equipment

What needs to be done?

Developing and searching strategies that will help to raise funds in order to make sustainable solid waste management in developing countries is necessary. Collaborative projects able to provide both financial and technical support should be searched and should let the government be a part of the projects so that sustainable waste management can be ensured to some extent. Awareness should be raised for household composting and recycling. PPEs and good wages should be provided to waste collectors to ensure their health protection and sustainable social life.

The governments of developing countries should generate more financial aid for integrated sustainable waste management. Since local governments of most developing countries have a low financial basis, they can collect service charges from the locals; no one should deny this as all the people are responsible for producing waste.

Educational programmes should be provided to the illiterate so that they can be aware of the harmful effects of waste on them, and the entire world. This will help in the reduction of waste generation from each household. The use of recyclable products should be given priority; people should be encouraged to buy recycled products.

Each developing country should carry out strategies to develop an integrated waste management system. Community participation and involvement of private sectors should be enhanced. Every strategy developed for waste management should be followed considering the available budget, public health, integrated approach to infrastructure development, and other various factors. It is better to prefer waste minimisation than waste management.

Adhikari is an assistant professor at Kathmandu University.

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Adhikari is an assistant professor at Kathmandu University.

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