July 13, 2023
Norfund is making its first two direct investments in plastic recycling in Africa in Nigeria and Ghana. “By showcasing functioning models, we can enable the development of an industry that is crucial in tackling the challenges of plastic pollution while creating a large number of jobs,” says Carl Johan Wahlund, Investment Director for Green Infrastructure at Norfund.
Norfund has committed EUR 2 million as a convertible loan to Wecyclers Nigeria Limited, a recycling company based in Lagos. At the same time, Norfund is announcing a USD 10.5 million investment in Miniplast Ghana Ltd, a leading plastics manufacturer based in Accra, to support its recycling capacity.
- The investment in Wecyclers will finance a new plant for the recycling of PET-bottles for use in new bottles locally and in Europe. The plant will be located in Ogun state in Nigeria and have a capacity of 12 000 ton per year. See separate press release here
- Norfund’s investment in Miniplast will go towards purchasing new manufacturing equipment and machinery to increase the company’s recycling capacity to 1,700 tonnes a month, increasing further the use of locally sourced recycled materials to substitute imported plastic resins and reducing production costs. See separate press release here
More than 171 trillion pieces of plastic are now estimated to be floating in the world’s oceans, an increase from 16 trillion pieces in 2005, and it could further nearly triple by 2040. Systems for collection of plastic is crucial in tackling plastic pollution. Establishing these with incentives and a commercially sound model across the value chain is however complicated even in many high-income countries, and still more challenging in developing countries, where waste regulation and enforcement of extended producer responsibility is lacking.
“Wecyclers has managed to establish a model in one of the more difficult areas of the world, with its own collection both directly from households and via kiosks and franchises, combined with a close collaboration with a European plastic producer which will serve to ensure that both the process and the output quality meets highest international standards”, says Carl Johan Wahlund, who heads Norfund’s Green Infrastructure investment area, which has a dedicated focus on waste and water.
In 2020, Miniplast established an in-house plastics recycling business that uses locally sourced plastic waste. These recycled plastics are then used by the company in the manufacturing of its finished products, as well as sold to third parties. The factory was also the first to install solar power delivered by Empower New Energy, another Norfund investee.
“Supporting local manufacturing and recycling initiatives will help create many decent jobs not only at Miniplast, but across the entire plastics value chain”Obafemi Awobokun, project manager for Miniplast in Norfund
The investment in Miniplast is expected to create more than 850 jobs across the plastics value chain.
“While the contributions of these two investments may seem small compared to the overwhelming challenge of plastic pollution, by showcasing a functioning model, they enable the development of an industry and the promotion of a culture of waste management. They will be Norfund’s first of many planned investments into the sector”, says Wahlund.
Miniplast Ghana Ltd is a leading plastics manufacturing company in Ghana and the West African sub-region. Established in 1988, Miniplast specializes in injection moulding and blow moulding, with its key offerings being products made from High/Low Density Polyethylene (H/LDPE), Polypropylene (PP) and PET Plastics. This includes industrial packaging solutions (packaging containers for many classes of products, bottles, jerrycans, paint and detergent buckets, pails, etc.), plastic furniture, and other household products (bowls, plates, buckets, basins). Headquartered in Accra, Miniplast has a current production capacity of 41 tonnes of plastic per day, and directly employs over 650+ people whilst indirectly employing over 200 more. The Company also has waste collection and grinding hubs in Kumasi and Tamale.
Wecyclers is a for-profit social enterprise that promotes environmental sustainability, socioeconomic development, and community health by providing convenient recycling services in densely populated urban neighbourhoods. Wecyclers addresses the challenge of urban waste, gives households a chance to generate value from their waste and provides a reliable supply of raw material to the local recycling industry.