Washington — The U.S. Agency for International Development announced June 5 a $35 million fund to support plastic pollution cleanup in developing countries in Asia, in partnership with the industry-funded investment firm Circulate Capital.
At a Washington launch event that included speakers from plastics and consumer product companies, USAID said the $35 million will come in the form of loan guarantees to support the $100 million that Circulate Capital has raised privately to fund plastic waste projects in Asia.
"Marine plastic pollution is a huge problem," Carrie Thompson, USAID's acting assistant administrator for the Bureau for Economic Growth, Education and Environment, said. "[This] kind of partnership with the private sector is critical to us.
"This problem is so big and it has so many associated development problems and the resources required to address it as such that no government can go it alone on this," she added.
USAID and Circulate founder and CEO Rob Kaplan described the project as "blended finance" and said they see the $35 million as helping to leverage other investment in companies and projects in plastic waste in Southeast Asia.
They said investments in plastic waste are often too risky for private capital alone, so a combination of government money and other investment with social goals can help to bring in more traditional, profit-oriented private funding.
"As we've looked at how you invest in the solutions that will prevent plastic pollution in some of these target markets, we've seen there's an incredible need for capital, well beyond the $100 million that we've been able to pull together," Kaplan said. "The pathway is to really unlock and catalyze billions of dollars of investment into Asian infrastructure and across the emerging markets.
"Today those dollars are being allocated to bridges and roads and ports. What we need to do is help those institutional investors allocate capital to waste and recycling," he said.
USAID said the partnership builds on work it's done with municipal waste recycling program in Asia and said at least 50 percent of the $35 million will go to Indonesia, the Philippines, Vietnam and Sri Lanka because they are among the largest sources of plastic pollution in the sea.
Thompson said USAID is concerned about the "knock-on effects" of plastic pollution on economic development and health, such as harm to fisheries and tourism, microplastics in the food chain and plastic waste on beaches serving as breeding grounds for mosquitoes that spread dengue fever and the zika virus.