Textile Industry Seeks Solutions for Circular Economy

Key stakeholders in Cambodia’s textiles industry have united to develop a circular textile economy to address mounting challenges in waste management
A panel discussion about Cambodia's Circular Textile Opportunities. Kiripost/Seng Mengheng
A panel discussion about Cambodia's Circular Textile Opportunities. Kiripost/Seng Mengheng

Government representatives and industry leaders in Cambodia are joining forces to explore opportunities for a circular textile economy, aiming to address the pressing challenges in waste management within the textile industry.

With the lack of available options for recycling textile waste in the country, stakeholders are focused on attracting recyclables, establishing proper waste disposal practices, and promoting the adoption of a circular economy.

On May 16, industry leaders and government representatives gathered at the Hyatt agency for a panel discussion titled "Textile Waste Opportunities for Circular Textiles, Garments, and Footwear in Cambodia".

The theme of the discussion revolved around identifying and harnessing Cambodia's potential in adopting a circular textile economy.

They are focused on tackling the pressing issue of textile waste, participants engaged in fruitful conversations to explore innovative solutions and pave the way for a more sustainable future in the Cambodian textile industry.

Dy Kiden, Director of the Ministry of Environment, claims about the new developments in the textile sector. He said that the circular economy is a topic that has been discussed previously, but that Cambodia is still in the early stages of learning about it.

Currently, the ministry is focused on managing solid waste from the garment industry, such as acrylic waste and wastewater treatment.

Kiden said that more cooperation is needed from all industries, not just in implementing their own waste management practices, but also in the upcycling of waste from other industries. He also noted that most garment factories in Cambodia produce for export, so cooperation from brand owners is essential for the adoption of a circular economy.

“The development of zero-waste industrial zones or eco-industrial parks would be a step forward for Cambodia in moving towards a circular economy,” Kiden said.

Currently, he added there is no specific policy or legislation in Cambodia related to the circular economy. However, the ministry has finalized a draft of the environmental code, which will be submitted to parliament soon.

Kiden believes that this code will help to promote the circular economy in Cambodia. He also said that the ministry is developing new policies and mechanisms to support adopting a circular economy in the government and industry sectors.

Ken Loo, Secretary-General of the Textile and Footwear Manufacturers Association in Cambodia (TAFTAC), spoke about the challenges facing the textile industry in Cambodia. He said the main challenge is the need for more options for managing textile waste.

Loo said there are only two options: landfill or incineration. Landfilling is a costly and environmentally harmful practice, while incineration releases harmful pollutants into the air.

There are no available options for recycling textile waste in Cambodia, Bangladesh, Vietnam, or Thailand. The only way to recycle textile waste is to export it to countries where there are recycling facilities. However, this comes at a certain cost.

“I think that's really the problem we face here. There are no other options available. There are options available at a cost, but they are not affordable for buyers or factories. That's why we want to work with the government to see how we can attract recyclables.” Loo said.

He added that the government would be working to attract recyclables and chemical recyclables to Cambodia. These companies could set up collection centers and export the waste to countries with recycling facilities.

TAFTAC is also working to raise awareness of the issue of textile waste among buyers and factories. The association is hoping that by raising awareness, buyers and factories will be more willing to pay for recycled textile waste.

Loo said that "he is hopeful that “the issue of textile waste will be partially resolved within the next 18 months. If this is achieved, it would be a major step forward for Cambodia in its efforts to adopt a circular economy.”

Massimiliano Tropeano, Integrated Expert of GIZ, EuroCham, highlighted the significant challenges in the waste management sector. While he acknowledged that not everything needs to be governed by strict laws, there is a need for basic rules and guidelines regarding waste treatment and classification.

The complexity of the issue arises from the involvement of multiple ministries.

Tropeano said the Ministry of Commerce plays a role as the waste originates from imported fabrics. This Ministry involved technology is involved due to the Centralized Unit of Fabric Recycling, which is a crucial mitigation action outlined in the Nationally Determined Contributions (NDC) document of Cambodia.

The Ministry of Environment for obvious reasons is involved in waste collection, landfill management, and related aspects. Lastly, the Ministry of Economics and Finance, specifically the tax department, is involved because selling waste acquired duty-free can create taxation and legal complications. he added.

"Every factory cannot sell the waste because 90-95% of it comes from abroad. It is fabric that has been imported duty-free. Therefore, the moment you sell the waste, you are acquiring an income from something that was taken duty-free, which attracts taxation and creates problems," Tropeano said.

He added that this intricate interplay of ministries contributes to the prevalence of informality within the sector. Many factories desire to generate some income from waste materials, but the lack of a formal framework results in informal transactions.

“The goal is to establish regulations that formalize the recycling industry, enabling factories to engage in the proper waste disposal and have legitimate transactions with sorters and recyclers.”

This is one of the solutions to treat the certificates issued by sorters and recyclers, indicating the quantity of waste received, as a valid export or an official means of waste disposal. This approach would prevent unnecessary taxation and encourage a formalized recycling industry, similar to how Chip Mong manages their waste.

Tropeano emphasized that establishing a comprehensive legal framework and formalizing the recycling industry would contribute to addressing the challenges in waste management and promoting a more sustainable approach in Cambodia.