The project “Circular Economy Malaysia – Financial Instruments Taking into Account the Revenue Side” is a result of the “Master Plan – Circular Economy Malaysia” project and aims to analyze in more detail a wide range of financial instruments for the economically sustainable implementation of circular economy infrastructure, using Malaysia as a case study.
Region:
Malaysia
Term:
June 2025 – September 2025
Partners:
Goal of the Project
The aim of the project is to develop a study using Malaysia as an example, which compares various common financing instruments for implementing circular economy concepts with a focus on waste collection, sorting, recovery, and recycling, discusses them in comparison with the sales tax solution, and applies them to advise other countries. The study should help to identify adaptable solutions to the most fundamental financing problems in the circular economy.
Background
Malaysia is on a promising path towards implementing the circular economy – supported by a clear legal framework, political will and the active participation of society. In the area of plastic packaging in particular, the introduction of an Extended Producer Responsibility (EPR) system has been decided in the states covered by ACT 672 (Solid Waste and Public Cleansing Management Act). The separate collection of other recyclable materials is also considered a key component.
At the “Masterplan Circular Economy Malaysia” workshop on July 16 and 17, 2024, in Kuala Lumpur, the introduction of a two-bin system for separating wet waste and dry recyclables was considered necessary, but with significant financing challenges. At the same time, the construction of waste-to-energy plants, sorting and processing infrastructure, and the marketing of secondary raw materials are planned.
In addition to the six existing sanitary landfills, the 165 unregulated landfills nationwide must be secured and, if necessary, closed. The increasing logistical requirements underscore the need for digital solutions and secure financing, as the current system with only one mixed material stream is already severely underfunded.
Activities and Measures
- Completion of a study analyzing various financing instruments for circular economy concepts, with a focus on waste collection, sorting, recovery, and recycling.
- Presentation of the completed study to the Circular Economy Council, the highest authority for the development of the circular economy in Malaysia.
Results and Publications
The results achieved within the framework of the project, as well as further publications, will be published here after the completion of the respective project phases.
Funded by
the Federal Ministry for the Environment, Climate Action, Nature Conservation and Nuclear Safety (BMUKN)
Additional funding from the Export Initiative for Environmental Protection (EXI) program.
