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  • Gordon Dumoulin

Grandma's New Thriving Business in 2018 | DIFFERENT CHINA (ep 9)

"Grandma's New Thriving Business in 2018, encompassing and reflecting the future and past of today's China. Chinese seniors filling the gap in the new circular economy of waste recycling"

Since 2nd quarter 2018, cities in China see a huge increase of seniors (mostly ladies) driving old-fashioned rusty tricycles in living compounds searching through garbage for cardboard and plastic waste. Living together with her son’s or daughter’s family in a million dollar apartment, many grandmas have gone more busy this year in their already active and involved lifestyle.

While the parents will leave home early in the morning for their jobs, grandma will dress the grandchild(ren), prepare breakfast and bring them to school, still sometimes on an old-fashioned tricycle with the kids in the back but more often in modern covered battery driven tricycles. In the recent past, grandma would come back and clean the house, go to market, prepare lunch and dinner, pick up the kids from school and often bring them again to private education or sport centers for further study or sports. At night when the parents return home, she will go out to dance or chat with her friends in the park or watch her favorite soap on TV. You would think a full-day program, especially for elderly people.

However in the course of 2018, a strong increase has been witnessed of many elderly in residence compounds collecting waste. As it is not a question of poverty in the far majority of cases, it is a very interesting and unique phenomenon which encompasses and reflects many historical, cultural and social aspects China and Chinese people are going through during this dynamic era of economic, environmental, political and high-tech developments.

Global Disruption Waste Recycling in 2018

For more than 25 years, many developed countries, including the U.S., have been sending massive amounts of plastic waste to China instead of recycling it on their own. For example, some 106 million metric tons, about 45 percent of the world's plastics set for recycling have been exported to China since reporting to the United Nations Comtrade Database began in 1992. The same kind of data applies to paper, cardboard and other kids of waste with China, the world’s largest paper recycler, have produced 63.3 million tons of waste paper pulp in 2016, according to the China Paper Association (CPA).

In 2017, China passed the National Sword policy banning plastic, cardboard and other kinds of waste from being imported which has been effective since beginning of January 2018.

This policy has created huge disruptions in the global waste recycling process; huge piles of waste are mounting in countries such as the United States, Japan and EU, trying to redirect the waste export towards other countries for recycling like Indonesia or the Philippines who often do not have qualified or compatible facilities for recycling.

But also the Chinese waste recycling industry has been facing huge challenges and difficulties as the import flow of incoming recyclable waste has been dried up. Many Chinese waste recycling companies are diverting to nations in South-East Asia who still accept import of waste from developed nations to keep the business going and the local waste supply within China has increased to vital importance for the survival of the local recycling industries.

And keep in mind that this is only the first major waste policy adopted by the Chinese government, there will certainly be more drastic environmental, material and recycling policies regarding consumer and industrial packaging coming up in the years to come which will have drastic effects for the Chinese industry (read the global supply market) and foreign companies doing business in or with China. 

New Waste Business Opportunities in China

As any disruption creates (or should create) new opportunities and ways, this is certainly to be seen in China with the waste import ban. While wastes are piling up in developed nations with little local action and diversion to unqualified recycling solutions, the Chinese waste recycling industry is rapidly undergoing a market revolution, transforming from a passive, abundant supply chain to an active circular, competitive supply economy.

Availability of primary wastes as raw material for the Chinese recycling industry are in severe shortage since the import ban and the perception of waste is suddenly much more seen as a valuable raw material.

The traditional chain of often state-owned companies, from local neighborhood collectors all the way up to national waste centers for supply to the recycling industry has been disrupted within a few months in China. Private enterprises have entered the waste recycling economy with new business concepts and often taking out several steps in the distribution chain. Those changes and new players have also stimulated the participation of residents to create value within the waste recycling business chain.

New waste collection and distribution models have been established, aside from the traditional waste distribution concept, often with more value and efficiency. There are even digital mobile APPs set up and managed by private waste processing companies in the market in which residents can order a pick-up of cardboard or plastic waste from their homes for which the residents receive income by weight and sometimes even a proper invoice. This leaves out a number of distribution steps, making the economy more competitive. One of these companies is Beijing Incom Resources Recover Co. Ltd., who launched Bangdaojia, an application that allows users to arrange a garbage pick-up transaction through their smartphones.

Amazing market innovations caused by disruptions through significantly changing supply and environmental policies.  

And guess what ?? Grandmas are playing a vital role in this new circular economy.

Social Transitions and Generation Gaps

The new emerging competitive waste supply market this year has caused many residents to dive into the market of waste collection and sales. As mentioned in previous section, the traditional waste collection and distribution chain in China has rapidly evolved into an active circular, competitive economy.

Seniors have emerged from the scarce waste supply situation as initiators to be collecting cardboard and plastic waste in their residence compounds during their scarce spare time in between the household and child care duties.

With for example prices for cardboard and paper waste ranging from RMB 0.7-1.0 per 市斤 (jīn, 500 grams), money is to be made up to a few hundred yuan per month when daily collecting waste for an hour or so.

Seniors collecting waste has stirred the discussion within many families and social networks. It is not that seniors must collect waste by poverty standards. Many of them living in with their children who own one or more million dollar apartments and having great jobs and income. The seniors taking the initiative to make the extra buck by collecting waste highlight core actualities and transitions which the Chinese society is experiencing during this dynamic era.

Different generations living close together and dependent on each other to keep the daily life running but with often a vast gap of perspectives and expectations.

While the 20’s-40’s middle class generation are inventing the new circular economy, new retail and high-tech with big dreams and big money, seniors have a backpack of the past in which life was very tough and every 100 yuan billet earned was hidden in a secret drawer in their old bedroom cabinet. As a feeling of value, safety, pride and security.

The older generations have overcome periods of hard labour work and family protection. The value of self-sufficiency and self-reliability is vital to this generation. Social awareness was less important as a roof, food, heating and children’s education were the deals to handle towards the future.

This perspective is vastly different from the younger generations in the middle class. As financial income allows them a comfortable life, social awareness and positioning is becoming much more important to make next steps in life and career. For themselves as well as their children.

While the grandparents are sometimes treating their grandchildren as queens or kings with the hardship of the past in mind, the parents want more and more their children to be independent, socially responsible and respectful in society. This causes naturally the common family generation clashes as anywhere in the world.

Above case is a more commonly known example of the generation gap but Grandma’s new thriving business in 2018, collecting waste to add some more hidden red billets in her drawer is a whole new dimension of the generation gap. Seniors realize that they cannot keep up with the new digital economy but the entrepreneurial and self-sufficient character of Chinese people does not prevent the seniors to grasp any opportunity to be self-sufficient and a value to themselves and their family.

And collecting waste is such a unique opportunity for the seniors as the 1-2 hours per day free time, the old rusty tricycle, and the nearby private waste depots or collection services through an APP makes the seniors ideal, independent couriers for waste collection within the new circular economy.

It is not difficult to imagine that the younger generations do not want to see their parents checking waste bins at any place, and especially not in their direct social environment. A social disgrace in current time for the new generation but the generation gap and perspectives are so vast that even giving money to Grandma for her drawer does not prevent her to create her own value and sustain her own self-sufficiency, it will only add to the number of red bills in the drawer.

"Dynamic times, initiatives, gaps and developments throughout all generations in the daily and immensely changing society of China" 

“Different CHINA” is a series telling different sides of China which are lesser known to the world. China is well known through many publications for its miraculous speed of developments and growth in technology, environment, commerce, social structures and international standing with Chinese people embracing innovation while keeping tradition highly valued. But this image does not do full justice as China is so much more in its diversity, culture, environment, people and initiatives.  “Different CHINA” is part of 5iZ.

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