In March 2024, negotiators and experts came together in Bellagio, Italy, for an exclusive meeting to discuss an essential topic: Plastic money. And we’re not talking about credit cards here, but the actual money we people around the world are paying for the production of plastics through our governments’ subsidies. I met with the organizers of the meeting, Ronald Steenblik of the Quaker United Nations Office QUNO and his colleague Andrés Naranjo, and Alexandra Harrington from Lancaster University Law School. She also chairs the Plastic Pollution Task Force of the IUCN World Commission on Environmental Law. Learn more from them about plastic subsidies in this episode!
Transcript
Music – Plink by Dorian Roy
Oliver Boachie
One of the things that we believe is so important is to reduce the volumes of plastics that we are producing and consuming.
Jennefer Baarn
There are so many financial flows going in the wrong direction and we need to curb that.
Oliver Boachie
Producers are being incentivized to produce more.
Hélionor de Anzizu
If you discuss with industry, if you discuss with states and others, you will hear that one of the reasons why plastics have penetrated our markets so easily, it’s because they are a particularly cheap material. Of course, if we continue subsidizing plastics production, it’s going to support and ensure that this remains the case.
Anja Krieger
Welcome to Plastisphere, the podcast on plastics, people, and the planet. My name is Anja Krieger. You just heard the lead negotiator for the plastics treaty from the Netherlands, the senior advisor to the Minister of Environment in Ghana, and the plastic trade expert from CIEL, the Center for International Environmental Law. They were among the participants of a meeting in Bellagio, Italy, at the end of March. Negotiators and experts came together to discuss an essential topic: Plastic money. And we’re not talking about credit cards here, but the actual money we people around the world are paying for the production of plastics through our governments’ subsidies. Despite climate change, many states are still spending billions of dollars a year supporting the production and consumption of fossil fuels — coal, oil and gas. That lowers the production costs for plastics, for the raw material and the huge amounts of energy needed to make them. The plastics industry also benefits from tax breaks, cheap loans and other favors.
Ronald Steenblik was the one who made me aware of this issue. He’s worked on subsidies to fossil fuels for over 30 years, and was the Special Counsellor for Fossil Fuel Subsidy Reform at the OECD — the Organisation for Economic Co-operation and Development. Today, Ron is retired but still donates his time working with the Quaker United Nations Office (QUNO). The Bellagio convening on subsidies was organized by QUNO, with support from CIEL and the World Conservation Union, the IUCN. I met with Ron and his colleague Andrés Naranjo, and they brought along Alexandra Harrington from Lancaster University Law School. She also chairs the Plastic Pollution Task Force of the IUCN World Commission on Environmental Law. For a start, Ron gave me a summary of what happened at the meeting in Italy.
Ronald Steenblik
We had eight representatives from governments and about 11 experts from intergovernmental organizations, non-governmental organizations and academia. Basically, we were there to try to develop a common understanding of the problem of of subsidies to plastics production and to look at possible legal language in the eventual Global Plastics Treaty, which Alexandra can tell you more about, and basically a roadmap for how we could all work together and collaborate and build a coalition of countries that would be willing to to tackle the issue of of subsidies to plastics.
Alexandra Harrington
If I could just jump in with one point to connect to that. When we had the convening, we had a very wide group of countries, and we had countries that were on all sides of this discussion — so countries where there are direct subsidies because they are producing countries, but also countries that are the recipients of goods and consumers of the goods, and also recipients of what we call legacy plastic waste, which is to say, the already produced and consumed, plastic products, the plastic bottles, the plastic bags, things like that, that for a variety of reasons wind up in, for example, oceans or marine environments, and then wind up on seashores especially, or in marine environmental ecosystems, and cause problems.
What was very important, and I think unique about the Bellagio convening, was bringing all those voices together, because we get those together often in a negotiation, but obviously they’re with their national delegations and that’s it. They voice the views of their nation and that’s it. Having them in a setting like Bellagio, where we were able to openly discuss these issues in a very protected atmosphere — because we operated under the Chatham House Rule, where everything that is said is not attributed to anyone in particular — it’s very much a protected environment that is really needed to foster dialogue about these types of issues without ramifications allowed. I think all sides have an understanding of this issue in a different way, and an understanding of more than just the immediate impact on their own country, but a global understanding of what the impacts are of subsidies on producing countries, as well as on countries that are consumers and countries that receive legacy waste.
Anja Krieger
You looked into these subsidies. Could you share specific examples of what form these subsidies take in different countries?
Ronald Steenblik
For example, in Saudi Arabia, one of its research organizations has shown that subsidies to ethane — which is one of the chemicals that then becomes ethylene and then eventually polyethylene (not all of that is used for petrochemicals) — but they could be as high as several billion dollars a year just in that one country. In the United States, a lot of states engage in what’s called investment competition. A big company will will say, “We’re thinking of building a plant here”, in Louisiana or in Pennsylvania or whatever. And then they are able to get big concessions on the taxes they would otherwise pay. An NGO in the United States recently estimated that, over the past 11 years or so, the value of those has been something like $9 billion. One plant in southwestern Pennsylvania, a $6 billion plant that’s recently come online, benefited from $1.6 billion in tax benefits.
Anja Krieger
In the plastics treaty negotiations that are ongoing, have subsidies been a topic so far and in what way?
Alexandra Harrington
Yes, they have been. Perhaps not as much as some people might like, but they certainly have been. Subsidies have come up in a couple of different places. The idea has been floated to have a special article that would just be on subsidies, but that has not so far been taken up. Instead, we see subsidies referred to in different parts of the draft treaty. So we see them referred to in the potential article which would, if adopted, attempt to limit the production of primary plastic polymers. We see them reflected in that in terms of reducing subsidies as a means of limiting them. We also see them discussed in the idea of transparency and reporting and the potential idea of having national action plans, under which countries would have to report what they’re doing, what their plans are for the future to implement their obligations under the treaty, what they’ve done in the past, and we’ve seen proposals for subsidies to be included in that, so that subsidies would have to be reported on. And countries would have to disclose what their subsidies are and how they have been either phased out or phasing down, depending on the language. Our understanding of subsidies is a long-term process. If we say we’re stopping all subsidies tomorrow, there may be many benefits. There are also potentially many downsides. So trying to put them in the treaty in a balanced way where we try to remove them, but we do it in a phased way using things like transparency requirements and reporting requirements has been the real focus so far of many of us in the treaty negotiating sphere.
Anja Krieger
Did you see that there were any specific barriers to getting countries to agree to take action on subsidies when it was a topic?
Alexandra Harrington
Unfortunately, yes. But I think that this ties into much of the discussion around the plastics treaty itself in terms of the plastics treaty coming at a very sensitive time. It’s a very necessary time. We know that plastic pollution is increasing dramatically, and it affects so many different aspects of human health and the environment, and biodiversity, etc., but it also is coming at the same time that the Climate Change Convention and the Paris Agreement, etc., have been putting pressure on the fossil fuel industry. What we’ve seen is a real concern among states that are more heavily dependent and tied to the fossil fuel industry, that their main source of revenue or one of their main sources of revenue not be so directly impacted and targeted.
I think it’s a pivotal point right now in this discussion, because we need to have an understanding more of why we need the plastics treaty, how it will work for countries that feel like their economies are threatened, etc., so they understand that the issue of subsidies in particular won’t undermine their ability to to be profitable and to take care of their citizens, while it will have the chance to also then help the environment and also help with the goals of creating a circular economy, addressing the life cycle, and also in spurring innovation. So in some of these countries we’ve seen — for example, in Saudi Arabia — a real shift towards the idea of using solar energy and being a producer of solar energy because of its geographic location. That type of incentivization can often come from things like how we classify subsidies, how we think about alternatives and substitutes. So that discussion, I think, really needs to be had, not as a potential barrier, but really to break down that barrier, because otherwise we’ve seen a polarization, with many countries that are concerned for their livelihoods and have that as their primary negotiating focus.
Anja Krieger
So let’s look into the future. And the question to all of you. What would be your ideal scenario for countries to deal with plastic subsidies if all goes well?
Alexandra Harrington
I would very much like to see, I think, what we have realistically [been] dreaming, but also being a realist. I would very much like to see what we have in the current revised zero draft being kept, especially because it is such a contested area in so many other discussions — not only subsidies but so many other discussions: the provision on primary plastic polymers. If we can have that and keep the substance of it the same and also include subsidies, for me that would be the ideal goal. If we step back at the end of the day, and hopefully in December in South Korea can sit there and go, it’s done. We have a document that would make me very happy. Honestly, it would.
Anja Krieger
Great. Andrés, what’s your ideal scenario?
Andrés Naranjo
Well, I think in Bellagio we really touched upon various proposals and scenarios that countries were willing or able to accept. And I think that Alexandra’s ideal scenario falls mid-way between a lower and higher ambition. I think that, at the highest level of ambition, what we could envisage would be a stand-alone provision on subsidies in the forthcoming Global Plastics Treaty, and this would really signal an ambition to curtail or to really end these subsidies in the context of the INC negotiations. It is unlikely, but it would be the highest ideal that we could aim for, at least for those that are really, really looking forward to an ambitious treaty that tackles upstream measures in the Global Plastics Treaty, so that one would be, for me, wonderful.
Anja Krieger
And, Ron, I’m sure you have an ambitious vision right?
Ronald Steenblik
Yeah. I would hope that the fact that we’re getting close to a treaty would lead to a more sustained and deeper effort to try to get better data on the size of the subsidies and their nature, and some analysis on the effects of them currently and the effects of phasing them out. As Alexandra mentioned, she would hope there would be transparency provisions in it. I would hope so too, but I’m a little bit skeptical that that’s going to result in a lot of information. As we’ve seen at the WTO, for example, they have subsidy-notification requirements, and even the Chairs of the committees that are responsible for it have pointed out that the information is very incomplete. It’s very unsystematic. So what it really needs is an organization like the OECD or maybe even an NGO having sufficient funds, and support from those providing the funds, to actually develop a database over time and engage in what, when I was at the OECD, we would call “monitoring” of the subsidies.
Anja Krieger
So we need transparency and data. Thank you so much. As a last question, is there anything we can do as citizens or as listeners of this podcast in terms of subsidies, or is that all up to the decision-makers up there?
Alexandra Harrington
Stay informed on the topic and start asking questions of governments, of officials, of representatives, just to find out what types of subsidies are in place, where are they going, what are they being used for. This is critical in plastics, but it’s also critical in a number of issues and industries that have environmental impacts and human health impacts, etc. So I think if we could just use this as a spark for people to know what questions to ask, that would be really wonderful.
Anja Krieger
Thank you so much, all three of you, for your time, for your insights and your engagement. I wish you the best for this crucial year in the negotiations. And see you soon, hopefully!
This was Plastisphere, the podcast on plastics, people, and the planet, with Ronald Steenblik and Andrés Naranjo from the Quaker United Nations Office, and Alexandra Harrington from Lancaster University Law School. Get in touch with them if you’d like to learn more about plastic subsidies. In the intro to this episode, you heard Oliver Boachie, senior advisor to the Minister of Environment in Ghana, Jennefer Baarn, the lead negotiator for the plastics treaty from the Netherlands, and Hélionor de Anzizu, staff attorney at CIEL, the Center for International Environmental Law. The music is by Dorian Roy, and the cover art by Maren von Stockhausen. All production is by me, Anja Krieger.
If you like this podcast, please rate and review Plastisphere and share it with your colleagues, friends and family. If you want to hear more, please go to plastisphere.earth/support and help me cover the costs. Also, you’ll put a big smile on my face!
I hope you tune in again next time! Have a great day, wherever you are.
Additional sources:
Environmental Integrity Project: “Billions in Taxpayer Subsidies to U.S. Plastics Plants Support Illegal Air Pollution in Communities of Color”
Harrington, A. and Steenblik, R., “Joint Submission to INC-3 on Plastic Subsidies”,
Submitted by the Friends World Committee for Consultation (FWCC), represented by the
Quaker United Nations Office (QUNO), and the International Union for the Conservation of Nature (IUCN)
Center for International Environmental Law (CIEL): “Tackling Subsidies for Plastic Production: Key Considerations for the Plastics Treaty Negotiations”