Mandatory EPR Implementation Expected to Strengthen Indonesia’s Recycling Ecosystem and Circular Economy
Danone Indonesia supports the mandatory, inclusive, and comprehensive implementation of Extended Producer Responsibility (EPR) across all industry categories to strengthen post-consumer waste management and expand Indonesia’s circular economy market. Through the Indonesia Packaging Recovery Organization (IPRO), Danone has participated in the development of EPR regulations together with the Ministry of Environment and has advocated for the involvement of local governments and the informal sector in their implementation. The EPR framework is also expected to incorporate an eco-modulation scheme, under which fees are determined based on the sustainability of products, allowing companies that have adopted circular economy principles and use more easily recyclable packaging to receive incentives. By requiring producers to take responsibility for the management of their products and post-consumer packaging, demand for recycled materials is expected to increase, enabling the market to expand and recycled materials to gradually become more competitive than virgin materials.
However, the development of Indonesia’s circular economy ecosystem continues to face three major challenges: fragmentation among stakeholders, governance issues, and limited access to waste processing facilities. Rekosistem noted that various stakeholders have demonstrated commitment to waste management, but coordination across sorting, collection, and final processing still needs to be strengthened. In addition, sustainability is often perceived as an additional cost because companies have not fully accounted for the real costs associated with waste management, pollution reduction, and the use of sustainable materials. Limited processing infrastructure also remains a significant challenge, particularly for plastic waste other than PET. Therefore, comprehensive EPR implementation needs to be accompanied by increased investment in collection, sorting, and recycling infrastructure, as well as stronger collaboration among government, industry, the informal sector, and waste management operators to establish a more integrated circular economy ecosystem.
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