1. The introduction of Biopackaging in Cameroon: What role for public policy?<br />By<br />Alain Ndedi<br />Director: Entrepreneurship Centre, Douala ; Cameroon <br />Email: ndedi.entrepreneur@gmail.com / Tel: 237 96463013<br />ASBTRACT<br />Although clear benefits could be gained from the widespread adoption of biopackaging, research on the potential scope and instruments for public policies to support its development and deployment has shown that these could only play a minor and secondary role. This article explores the two main reasons for this.<br />INTRODUCTION<br />Biopackaging refers to a specific class of packaging solutions, characterised by two main “green” features: biodegradability (the product will break down or compost) and sustainability (it is produced from a renewable resource such as corn, wood pulp or vegetable oil). These properties broadly define three different material classes: synthetic and biodegradable, bio-based and biodegradable, bio-based and nonbiodegradable.<br />There are today three dominant chemical technologies for renewable biopackaging: polylactic acid (PLA), polyhydroxyalkanoates (PHA) and thermoplastic starch (TPS). Biopackaging is a growing part of the chemicals industry, although it only represents a small fraction of the very large volume of packaging manufactured every year. The increase in world production is however quite significant: from 20 000 tonnes of biodegradable polymers in 1995 to 600 000 tonnes in 2008. Biopackaging has many uses in the food, drink, cosmetics and pharmaceutical industries with a wide variety of applications, including flexible films, bags, trays, netting, bottles, cups, labels, tubs and blister packs.<br />BENEFITS OF BIOPACKAGING ECO-INNOVATION <br />Biopackaging (also often called bio-plastics) is a genuine eco-innovation that offers multiple benefits to the industry as well as final consumers. First of all, from an environmental perspective, it takes less energy to produce and it generates fewer carbon emissions. For example, polylactic acid (PLA) production (e.g. for bottles) requires 20% to 50% less fossil energy than traditional plastic production. Biopackaging is also entirely compostable in industrial facilities and it does not require incineration of plastic wastes, which can release carbon dioxide as well as various harmful chemicals into the atmosphere. Finally, contrary to conventional petroleum-based plastics, which take a very long time to degrade and must be stored in landfill sites if not incinerated, biopackaging with biodegradable properties offers a green solution. Health issues reinforce these environmental benefits. Today, plastic packaging leaches out chemicals called phthalates into the food or water in plastic bottles. Because it increases the levels of oestrogen in humans and food chains, phthalates are considered dangerous hazards which may cause cancer including breast cancers and low fertility in men. Biopackaging on the contrary is made from natural raw materials largely consumed for centuries by humans and is unlikely to be harmful to people’s health.<br />While clear benefits could be gained from the widespread adoption of biopackaging, research on the potential scope and instruments for public policies to support the development and deployment of biopackaging established that such policies could only play a minor and secondary role.<br />Biopackaging market prospects limited to niche segments according to the industry<br />Despite multiple announcements in biopackaging initiatives, the main food, drink and cosmetics producers as well as large retailers have little economic interest in the extensive adoption of this technology, with the exception of a few specific niches. First and foremost, despite the rising price of oil and oil-based products, packaging made from biomaterials is still three to four times more expensive than conventional plastics. This extra cost cannot easily be passed on to consumers, among whom there is very little awareness of biopackaging and associated willingness to pay for its superior environmental performance.<br />Many retailers (Sainsbury, Leclerc) undertook a disappointing and unconvincing experiment several years ago with the introduction of compostable carrier bags, which were massively rejected by consumers. Second, despite technological advances, biopackaging materials offer inferior performance compared to oil-based packaging. They tend to have a weaker barrier to gas and moisture, low resistance to heat (cannot be microwaved) and a short shelf life. Carbonated beverages lose their sparkling character quickly in PLA bottles.<br />Finally, from a strategic perspective, biopackaging clearly does not top the environmental agenda of retailing firms. With the main pressure coming (or expected to come) from carbon taxes or emissions trading systems, transport is largely viewed as the priority, and optimisation of logistics is the main field for short-term improvements, innovation and investment. The story is similar in agro-industries, which focus on food and drink manufacturing processes in terms of carbon dioxide emissions. In parallel, in terms of green marketing and brand recognition, a range of other measures are seen as easier, faster and less costly to implement than biopackaging: organic offers, fair trade supply chains, product labels, sponsoring of events and associations, sustainable development corporate reports.<br />The result is that biopackaging is widely seen in the industry as an attractive but rather medium- to long-term solution, owing to the present unfavourable competition with alternative environmental projects. Another, though secondary, argument is the risk of supply bottlenecks and shortages, because of a limited number of active players and insufficient production capacity to fulfil fast-growing demand for biopackaging materials.<br />There are however some well-known, largely mediatised biopackaging initiatives: Sainsbury (organic fresh food, meat), Biota Water and Belu Water bottles, Volvic and Evian plastic-neutral bottles by Danone Waters, and Tesco (organic fruit) in the United Kingdom. A close examination of these initiatives, together with interviews with the companies involved, shows that all these applications correspond to very specific niches, for which the above-mentioned drawbacks of biopackaging are irrelevant. Fresh and organic products (e.g. fresh fruits, vegetables, bread, prepared salads) are the main target for biopackaging solutions. In this case, the performance properties of biopackaging are not a serious problem as there is no particular need for high barrier properties, heat resistance or long shelf life. Moreover, retailers can use biopackaging as a marketing and competitive opportunity to target a specific, environmentally conscious consumer group. Biodegradable packaging and organic products clearly go hand in hand and it is likely that the type of customer who buys fresh and organic products will also be the type of customer who cares about the environment and may be willing to pay a little more. As organic products are already priced at a significant premium, the extra cost is less a problem for retailers and can more easily be absorbed without increasing prices.<br />However, the firms involved explain that the technical and demand conditions are quite specific and that they do not intend to adopt biopackaging materials on a larger scale. Without significant technological progress to improve barrier properties of biopackaging and proper monetisation of environmental benefits, they consider current economic incentives too small to trigger mass investment and deployment. Other market niches will certainly be explored (such as prepared meals using innovative PLA produced from D- or L-lactic acid which can resist heat up to 175°C) and will support the growth of the biopackaging production but the process will be slow and limited.<br />The pending issue of the management of biopackaging waste and recycling<br />The second crucial challenge faced by biopackaging, according to all the players interviewed, deals with the end-of-life stage of these products. The absence of a waste management system is a major concern, as the recycling and sustainable features of biopackaging are a crucial aspect of its environmental benefits. Organising an optimised waste management system for biopackaging is a complex challenge for several reasons. First, it is strongly dependent on local and regional regulations, the total volume on the available market, and the specific composition of waste streams (retailers’ offers and local consumption patterns). Second, an efficient and smooth articulation has to be found with the local infrastructures for collection and recycling (plastic, glass, paper) in place in many countries. For example, compostable bottles, e.g. made of corn, should be separated from conventional plastic and PET bottles, with a distinct collecting network and recycling system.<br />Home composting is an efficient and simple solution but it is costly and cannot be implemented everywhere, especially in dense urban areas. So far there are very few municipal composting systems. As a result, biopackaging materials will likely end up in landfills where a fraction of them will not break down. Technological and R&D efforts aim at finding innovative solutions, for example using nanotechnology. Nano particles added during the foaming process used to manufacture biodegradable plastics (such as PLA) could increase water permeability and speed up the breakdown of materials in compost as well as storage systems.<br />Another environmental option to be considered is a closed loop system, such as the one organised for the plastic neutral water bottles scheme launched by Danone Waters in the United Kingdom for its Volvic and Evian brands in February 2009. The objective is to save 5 000 tonnes of PET in the short term. Several partnerships have been set up with councils for waste collection by the firm’s partner, Greenstar. The PET is then converted in Dijon, France, and reused to package new bottles after a sorting, cleaning and melting process. Such a concept could be applied to biopackaging to ensure that full the environmental benefits are effectively realised. However, as noted above, the fact that existing schemes focus on carbon or pollution emissions does not allow for a fair and quick monetisation of the environmental benefits associated with biopackaging. The classic “chicken and egg” problem in terms of increased biopackaging production and the existence of waste management systems cannot easily be solved by financial transfers or public subsidies, supported by future expected savings.<br />A persistently large price differential and poor valuation of end-of-life products combine to drastically limit the viable scope for biopackaging. In this context, the definition of a relevant and efficient policy is a complex issue, as most available economic instruments only affect the use of biopackaging materials indirectly. For example, when considering the waste problem, there is a general consensus that the management schemes implemented over the last two decades have improved the recycling ratio, but have not necessarily reduced the total volume of packaging produced. In France, the Point vert label, which has been in place for 18 years, has made it possible to increase the fraction of recycled packaging material up to 63% in 2009. But the volume of domestic waste has grown to 46 kg per capita.<br />Even if the collection and the recycling of waste reach a high level of efficiency, no sustainable and truly positive environmental benefit can be gained without significant improvements in the upstream stage. This calls for specific incentives to reduce the weight of packaging and make recycling easier. But then, the volume of inputs in the waste management system will decrease, and this may weaken the economic and financial viability of the recycling systems in place, which are based on the processing of a specific volume of waste.<br />This case illustrates the potential conflicting interests of policy initiatives carried out separately at different stages of the global value chain. At the European level, the Landfill Directive permits the burning, the mechanical biological treatment, and the composting of organic waste elements. While each solution contributes to the overall objective of reducing organic waste, there is no specific incentive for separate waste collection. A final element is the potential divergence between European and national regulations and policy instruments. For example, in the Packaging Directive, organic recycling does not count for the “back-toplastics” recycling quota, although it does in Germany. France has suggested that bioplastic bags should be mandatory in the retail sector. But this is not compatible with European free trade arrangements and the Packaging Directive.<br />CONCLUSION<br />Biopackaging offers an innovative and sustainable solution, based on bioderadable features and production from agricultural renewable resources, to the growing demand for packaging materials in the food, drink, cosmetics and pharmaceutical industries. Despite rapidly growing production, its usage still remains marginal and restricted to specific market niches, where its technical properties and demand patterns offer a favourable and profitable ground for adoption. The main reasons are, on the one hand, insufficient economic incentives for producers and retailers to choose this technology owing to its high cost and poor valuation by consumers, and, on the other, the lack of specific waste management systems for recycling. As a result, the potential public policy instruments for supporting increased use of biopackaging (such as pilot programmes, R&D subsidies or differential taxation) are unlikely to be sufficient to overcome the lack of incentives for industry. In fact, most of the players involved in the biopackaging business consider that under current conditions economic profitability cannot be achieved with economic instruments. Therefore, only<br />References<br />Callegarina, F., J.-A. Quezada Galloa, F. Debeauforta and A. Voilleya (1997), “Lipids and Biopackaging”, Journal of the American Oil Chemists' Society, Vol. 74, No. 10, pp. 1183-1192.<br />Haugaard, V., A.-M. Udsen, G. Mortensen, L. Høegh, K. Petersen and F. Monahan (2001), “Potential Food Applications of Biobased Materials. An EU-Concerted Action Project”, Starch/Stärke, Vol. 53, No. 5, spp. 189-200.<br />