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Government Support And Improving Economic Sentiment Help Mitigate Sector Vulnerabilities For GCC Banks



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Similarly, in Qatar the state’s footprint in the economy and support measures helped reduce COVID-19’s effects on the banking system. However, we remain concerned about the system’s build-up of external debt, which has been exacerbated by abundant global liquidity and the otherwise favorable credit profiles of large Qatari banks. That said, we take comfort from the government’s highly supportive stance toward its banking system.

In Kuwait, concerns center on the government’s capacity to strike a deal with parliament to fund its fiscal deficit. In the absence of such a solution and disruptive government expenditure adjustments, the hit to the economy and banking sector could have deeply adverse implications for financial stability. This could also lead us to question our current expectations of government support to the banking sector in case of need.

We consider the Saudi Arabian banking system the least vulnerable in the current environment. In our view, Saudi banks will continue to benefit from mortgage growth and the implementation of Vision 2030, which we expect will boost asset quality and profitability indicators.

Overall, GCC banks’ profitability stabilized in first-half 2021 due to still-high cost of risk and stable interest margins. In the absence of further shocks–pandemic or nonpandemic related–we expect this to continue in second-half 2021, aided by careful cost control. We also expect banks’ capitalization will remain supportive of their creditworthiness. In this publication, we further explore the financial performance of selected GCC banking systems in first-half 2021 and outline our base case for the remainder of the year.

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Kuwait: Resolving The Fiscal Impasse Will Be Key

We expect higher earnings supported by improved revenue.   Kuwaiti banks (systemwide metrics refer to our sample of rated banks in Kuwait comprising more than 50% of sector loans) reported stronger earnings in first-half 2021 compared with the same period last year, supported by lower cost of risk and improved revenue generation. In 2020, banks’ revenue was hit by the deferral of exposures (interest income payment deferrals were recognized on banks’ profit-and-loss statements with no late payment fees) enacted by the central bank to manage the pandemic’s effects on the local economy. However, in fourth-quarter 2020, lower cost of funding caught up with lower asset yields from the U.S. Federal Reserve’s rate cuts, improving banks’ margins into first-quarter 2021. Margins (calculated on loans) remained relatively unchanged between first-half 2020 and first-half 2021, while benefiting from a recovery in noninterest income, offsetting higher costs. Annualized cost of risk also somewhat declined–20 basis points (bps) in first-half 2021 versus 2020–as the Kuwaiti economy slowly reopened and given banks took already a significant hit in 2020. Stage 2 loans continued to increase, reaching 9.6% of total loans at June 30, 2021, compared with 8.5% at year-end 2020. However, Stage 3 loans remained low at 2.5% of total loans at June 30, 2021, versus 2.6% at year-end 2020, thanks to continued regulatory support.

We expect additional pressure on asset quality toward second-half 2021 as support measures are lifted.  We expect banks’ earnings to partially recover this year, exceeding 2020 levels but still below 2019, mainly supported by improved margins. We expect rated banks’ cost of risk to slightly increase to about 1.5% in 2021 from about 1.4% in 2020 as forbearance measures are progressively lifted. We also forecast further pressure from the real estate sector, with rated banks’ nonperforming loans (NPLs) to reach 2.7% of total loans in 2021 from 2.6% in 2020. This compares to our domestic systemwide NPL forecast of 3.4% in 2021, from 2.1% in 2020. We note that our sample of rated banks generally have stronger asset quality than the wider banking sector.

Government support will continue for now.  The Kuwaiti government’s persistent lack of a comprehensive funding strategy, despite the central government’s ongoing sizable deficits, raises concerns. Due to parliamentary opposition, the government has so far been unable to pass a law giving it the authority to issue debt or gain immediate access to its large stock of accumulated assets. The authorities have in the meantime relied on the General Reserve Fund (GRF) to meet budgetary requirements, depleting it in the process. Our base-case expectation remains that the government will eventually adopt a new debt law or gain access to alternative funding. However, in the short term, we believe the continued fiscal funding impasse and further potential GRF depletion could question the government’s ability to provide timely support to Kuwaiti banks in a downturn. This could adversely affect our view of banks’ creditworthiness.

Table 1

Kuwaiti Banks*
Net interest margin (%) Return on assets (%) NPL ratio (%) Cost of risk (%)
2019 2020 2021F 2019 2020 2021F 2019 2020 2021F 2019 2020 2021F
National Bank of Kuwait S.A.K. 2.58 2.31 2.50 1.53 0.89 1.04 1.10 1.72 2.70 0.78 1.40 1.30
Boubyan Bank K.S.C.P. 2.75 2.68 2.60 1.30 0.57 0.57 0.84 1.12 1.38 0.53 1.33 1.30
Burgan Bank 2.59 2.24 2.14 1.18 0.48 0.55 2.38 3.83 4.40 0.74 1.48 1.66
Gulf Bank 2.79 2.12 2.30 1.04 0.47 0.72 1.16 1.17 1.85 1.44 1.44 1.33
*Data as per S&P Global Ratings’ definitions. F–S&P Global Ratings’ forecast. NPL–Nonperforming loan.

Qatar: External Debt Remains In Focus

We expect the subdued private sector to show signs of recovery.  Overall credit growth in Qatar’s private sector, at just under 5% over first-half 2021 (excluding lending to the government but including other public sector entities), indicates much more subdued activity compared with 8% over the same period last year and an annual average growth rate of 14% over 2019–2020. Notable in this data is the brisk expansion in consumption lending, which has increased by the same amount as it did annually in 2019 and 2020, indicating that retail confidence has improved faster than corporate sentiment. However, we expect the latter will improve over the second half, with momentum behind a recovery building. We maintain our private sector growth estimate of about 8% for the year.

Public sector activity is highly visible on both sides of the balance sheet.  Qatar’s public sector accounts for at least one-third of total credit directly and more indirectly. Credit extended directly to the government increased to 15% of total credit at June 30, 2021, from just under 10% at June 30, 2020, and accounted for nearly 60% of total credit growth. Overdrafts to the Ministry of Finance comprised the majority and increased nearly 80%, or $15 billion, easily offsetting a decline in loans. We believe these facilities made up most lending for some banks in the first half, including a significant proportion for the biggest lenders. The government’s fiscal position remains solid, however, and public sector deposits in the system increased almost $8 billion to total about $80 billion over the same period, just shy of their 2017 boycott-related peak. Private sector deposits remained flat, meaning the public sector accounted for almost all domestic deposit growth.

We expect the government and wider public sector’s footprint will remain highly visible in the local economy, and that lending to the government will continue to account for a significant portion of total credit. Although this will help to contain NPL formation (we expect a systemwide NPL ratio peak of about 3.3%-3.5% from 2.7% in 2019), related margin is likely lower than when funding private sector activity. We view an increase in these overdraft facilities as less likely, following relative stability in the second quarter, and because we expect improving demand to support earnings. As the pandemic’s effects continue, we expect the real estate sector and exposures outside Qatar–particularly in Turkey–to maintain credit losses at an elevated level this year and next. Coupled with weak operating conditions over first-half 2021 and continued low interest rates, we expect that Qatari banks will exhibit lower profitability this year and narrow interest margins through 2022.

Nonresident deposits increased roughly the same amount as domestic deposits over first-half 2021, but there are signs of stabilization.  Nonresident deposit levels fell slightly in the second quarter, after a significant increase in the first quarter, which was likely in part linked to normalizing relations with GCC neighbors. Still, on aggregate, nonresidents fund nearly 40% of domestic loans and, given limited domestic sources of funding outside the public sector, more volatile foreign liabilities could continue to fund larger proportions of local lending. Although the public sector has demonstrated its ability to support banks, Qatar is becoming more exposed to the risk of a sudden shift in investor sentiment that could be increasingly costly to contain. Although extremely destabilizing events are less likely, they have occurred in the recent past and could materialize because of geopolitical risk, a sharp decline in oil price, or simply a shift in global liquidity conditions instigated by developed market central banks. Pandemic-related risks remain, although the country has made good progress in terms of vaccination rates.

Table 2

Qatari Banks*
Net interest margin (%) Return on assets (%) NPL ratio (%) Cost of risk (%)
2019 2020 2021F 2019 2020 2021F 2019 2020 2021F 2019 2020 2021F
Qatar National Bank (Q.P.S.C.) 2.45 2.33 2.25 1.61 1.23 1.22 1.85 2.12 2.51 0.50 0.84 0.80
Qatar Islamic Bank Q.P.S.C. 2.61 2.75 2.50 1.89 1.79 1.49 1.24 1.37 2.74 0.66 1.08 1.06
Commercial Bank (P.S.Q.C.) (The) 2.36 2.31 2.30 1.43 0.87 1.39 4.89 4.28 4.39 1.19 1.68 0.96
*Data as per S&P Global Ratings’ definitions. F–S&P Global Ratings’ forecast. NPL–Nonperforming loan.

UAE: Government Support Is Key

The extension of the support scheme is helping the sector.  UAE banks’ performance was slightly better in first-half 2021 than first-half 2020 on the back of lower cost of risk, in part due to large provisions taken by banks for one-off cases in the previous year. The extension of the TESS measures has given corporates impacted by the pandemic more breathing room to restore their financial profiles. At the same time, the macroeconomic environment has started to improve thanks to higher oil prices and strong vaccination rates. However, asset repricing, to reflect lower rates, reduced margins and partly offset the positive effects of lower cost of risk in first-half 2021. We expect this trend to continue in the second half, with banks posting slightly better results for full-year 2021.

We expect asset quality to remain weak over the next 18 months.  The extension of TESS measures–including the requirement that banks not classify exposures as nonperforming if the borrowers suffered from cash flow pressures related to the pandemic–means the actual extent of asset quality problems is not fully visible on banks’ balance sheets. At June 30, 2021, Stage 3 loans as a percentage of gross loans stood at 6.0%, compared with 6.1% at year-end 2020. Stage 2 loans stood at 7.2% for the first half. We anticipate that NPLs will peak in 2022 once forbearance measures are lifted and banks start recognizing the full extent of asset quality problems. Notably, the COVID-19-induced economic shocks came at a time when the real estate sector was already under significant stress. Other sectors, such as hospitality and discretionary consumer goods, have also experienced a significant decline in revenue, weighing on credit quality.

We expect the government to continue supporting the banking system.  The UAE government has been highly supportive of its banking system throughout various past crises, injecting the necessary liquidity and capital support when needed. We expect this support to continue in the future as authorities drag their feet on the adoption of a resolution regime.

Table 3

UAE Banks*
Net interest margin (%) Return on assets (%) NPL ratio (%) Cost of risk (%)
2019 2020 2021F 2019 2020 2021F 2019 2020 2021F 2019 2020 2021F
Abu Dhabi Commercial Bank PJSC 3.08 2.75 2.40 1.41 0.95 1.05 4.78 8.03 9.30 1.10 1.58 1.18
Mashreqbank 3.20 2.17 2.40 1.44 (0.77) 0.49 4.48 6.11 5.66 1.53 4.19 2.14
Sharjah Islamic Bank 2.26 2.23 2.20 1.20 0.81 0.76 5.14 4.89 6.06 0.37 0.90 1.26
First Abu Dhabi Bank P.J.S.C. 2.25 1.99 1.80 1.65 1.24 0.86 3.17 3.91 4.31 0.46 0.63 0.72
National Bank of Fujairah PJSC 3.51 2.79 2.80 1.40 (1.20) 0.31 5.44 10.05 11.97 2.12 4.93 2.97
*Data as per S&P Global Ratings’ definitions. F–S&P Global Ratings’ forecast. NPL–Nonperforming loan.

Saudi Arabia: Rapid Lending Growth To Continue

System performance has been solid so far.  Saudi banks’ performance was broadly in line with our expectations with two notable deviations. First, credit to the domestic private sector increased much faster than we forecast at 9.7%. This was because of faster-than-expected mortgage growth, with year-to-date origination already exceeding our expectations for full-year 2021, and a sharp increase in corporate lending in the first quarter. Second, systemwide average cost of risk was better than we expected at about 0.8%-0.9%, including one-offs related to the National Commercial Bank and Samba Financial Group merger. Although lower cost of risk is in part driven by high credit growth, it also demonstrates stronger nonoil sector performance, as evidenced by purchasing managers’ indexes in positive territory. Net special commission margins stood broadly flat at about 3% on a weighted-average basis with lower margins on corporate business due to a lower Saudi Arabian Interbank Offered Rate–offset by an increase in retail business and higher loans-to-assets ratio. Overall, Saudi banks’ profitability was slightly better than expected with return on assets reaching 1.6% at June 30, 2021, compared with 1.3% at year-end 2020.

We expect this strong performance to continue.  We now expect credit growth to reach about 15% in 2021, highly skewed toward retail and particularly mortgage lending. We also expect cost of risk to remain stable at about 90 bps-100 bps from 100 bps at year-end 2020, to reflect stronger banking sector performance. This also signifies the gradual phase-out of small and midsize enterprise support programs and our less optimistic GDP and oil price projections. Despite increasing vaccination rates, the evolution of COVID-19 strains and possible introduction of health-related restrictions across the globe can directly affect oil prices, with knock-on effects for Saudi’s fiscal revenue and nonoil sector. Weaker payment discipline and reallocation of funds between projects can also hit Saudi banks’ asset quality, although this would probably create some funding demand from government-related entities.

Table 4

Saudi Arabian Banks*
Net interest margin (%) Return on assets (%) NPL ratio (%) Cost of risk (%)
2019 2020 2021F 2019 2020 2021F 2019 2020 2021F 2019 2020 2021F
Saudi National Bank 3.73 3.50 3.00 2.39 2.09 1.62 1.84 1.72 1.91 0.51 0.60 0.92
Saudi Investment Bank (The) 2.57 2.61 2.45 0.24 0.98 0.68 5.65 4.33 4.11 2.23 0.77 1.19
Al Rajhi Bank 5.05 4.53 4.15 2.72 2.48 2.32 0.93 0.78 0.69 0.71 0.75 0.71
Arab National Bank 3.53 3.00 2.90 1.67 1.14 1.14 2.10 3.52 3.57 0.69 1.06 1.08
Banque Saudi Fransi 3.12 3.07 2.90 1.69 0.83 1.23 2.64 2.78 2.90 0.76 2.02 1.14
Riyad Bank 3.50 3.28 3.05 2.26 1.64 1.54 1.01 2.03 2.32 0.58 1.13 0.85
*Data as per S&P Global Ratings’ definitions. F–S&P Global Ratings’ forecast. NPL–Nonperforming loan.

This report does not constitute a rating action.

Primary Credit Analyst: Zeina Nasreddine, CFA, Dubai + 971 4 372 7150;
Secondary Contacts: Mohamed Damak, Dubai + 97143727153;
Benjamin J Young, Dubai +971 4 372 7191;
Roman Rybalkin, CFA, Moscow + 7 49 5783 4094;
Puneet Tuli, Dubai + 97143727157;

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Sweet Sorghum offers Solutions in Drought-hit Southern Africa




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By Hamond Motsi

The southern African region is battling with drought at present. This is the result of El Niño, a natural climate cycle characterised by changes in Pacific Ocean temperatures. It has effects on global weather patterns, particularly rainfall and temperature.

The drought has hit the region’s agricultural productivity hard. MalawiZambia and Zimbabwe have declared a state of disaster with respect to their current agricultural outputs. They are seeking humanitarian assistance in the form of food aid to feed their people. The downturn also has economic implications, since over 70% of people residing in the region’s rural areas rely on agriculture for their livelihoods.

The dire situation underscores how important it is for the agricultural sector to prevent, avoid or prepare for the impacts of climate change, which will also bring extremes of weather.

One measure the sector can take is to cultivate biofuel crops. These are crops rich in starch, sugar or oils that can be converted into bioethanol directly or through a fermentation process. Bioethanol, a type of ethanol produced from biological or plant based sources, emits fewer greenhouse gases compared to fossil fuels like petroleum, natural gas and coal. Commonly used biofuel crops include sugarcane, maize, grain sorghum, sugar beet, rapeseeds and sunflower.

These conventional biofuel crops do have drawbacks, however. They are highly susceptible to extreme weather events. They require high upfront investment for fertilisers, chemicals and irrigation. And they compete with food production – if they’re grown as biofuels they can’t also be used as food because of how they have to be processed.

So, researchers are always on the lookout for crops that might be good biofuels without those problems. Sweet sorghum, which is indigenous to the African continent, is one such crop. Unlike the better-known sorghum, it has sweet juice in its stems. In a recent study, I reviewed scientific literature to analyse the potential significance of sweet sorghum to African farmers because of its multipurpose nature and ability to adapt under harsh climatic conditions.

Multiple uses

Sweet sorghum has many uses. It can produce grains, animal feed and sugary juice, making it unique among crops. The grains from sweet sorghum are prepared as steamed bread or porridge malt for traditional beer, as well as in commercial beer production across the continent.

They’re nutritionally rich, with high energy values (342 calories/100 g), proteins (10g/100 grains), carbohydrates (72.7g/100 grains), and fibre (2.2g/100 grains) as well as essential minerals such as potassium (44mg/100 grains), calcium (22mg/100 grains), sodium (8mg/100 grains) and iron (3.8mg/100 grains).

The nutritional value of maize is fairly similar: proteins (8.84g/100 grains), carbohydrates (71.88g/100 grains), fibre (2.1g/100 grains), potassium (286mg/100 grains), calcium (10mg/100 grains), sodium (15.9mg/100 grains) and iron (2.3mg/100 grains).

What sets sweet sorghum apart from a crop like maize is that it’s also resilient in arid climates and has multiple other uses. For instance, it produces a lot of plant material (biomass) as it grows, which is left over after harvest. That’s why it’s useful as animal feed too.

Animal feed is made from what remains once the sweet sorghum crop has been harvested and its grains and stem juice stripped off. The residue is high in nutritional content, which can improve the quality of diets of animals, including cattle. The grains can also be used for animal feed.

The sweet juice in the crop’s stalks is what’s used to create bioethanol. Sweet sorghum contains sucrose, glucose and fructose, which are essential for bioethanol production. Of the conventional biofuel crops I’ve mentioned, only sugarcane yields more ethanol. Studies in the United States have shown that sweet sorghum far outstrips maize when it comes to bioethanol production: it yields 8,102 litres per hectare planted, while maize yields just 4,209 litres per hectare.


Perhaps most importantly given the southern African region’s current drought struggles, sweet sorghum is well-suited for cultivation in the sorts of adverse conditions that are typically challenging for conventional biofuel crops.

One of the key characteristics of sweet sorghum varieties is their drought resistance. It allows them to enter a dormant state during extended periods of dryness and resume growth afterwards. Research has shown that, under intense water scarcity conditions, sweet sorghum makes use of its stalk juice to supplement its plant needs.

Sweet sorghum’s ability to withstand low water and nitrogen inputs, as well as its tolerance for salinity and drought stress, makes it an ideal crop for farmers in arid regions. This is why it’s widely used in other parts of the world, including the USBrazil and China.

Investing in sweet sorghum

The continent’s current agriculture value chain is dominated by major crops like maize, wheat and rice, which all originate from outside Africa. Not enough attention is given to crops of African origin, like sweet sorghum, even though it is a multipurpose, hardy crop with great potential for farmers. People are more familiar with sorghum, not the sweet variety, and it is also under-researched.

Governments should be using their agriculture extension services to raise awareness among farmers and consumers about the benefits and practical applications of sweet sorghum in people’s diets.

Developing recipes and secondary or industrial products can enhance the feasibility and awareness of sweet sorghum farming. By investing in research and development, the full potential of sweet sorghum cultivation can be unlocked through governments and the private sector.

Hamond Motsi is a PhD Student in Agriscience, Stellenbosch University

Courtesy: The Conversation

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Lithium Boom: Zimbabwe Looks to China to Secure a Place in the EV Battery Supply Chain




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Chinese investors have flocked to Zimbabwe to secure lithium supplies, promising local development. But analysts warn Zimbabwe needs more robust governance for communities to reap the benefits. Reports Andrew Mambondiyani

Wonder Mushove stared blankly at plumes of red dust billowing into the sky as more than 30 trucks carrying loads of lithium ore rumbled past his newly-built house in Buhera, in eastern Zimbabwe.

The trucks drive by Mukwasi village on the dirt road linking the Chinese-owned Sabi Star lithium mine to the tarred highway. They travel through the border town of Mutare to the port of Beira in neighbouring Mozambique. From there, the lithium-containing minerals are loaded onto ships and exported to China – the world’s largest manufacturer of lithium-ion batteries.

The dust hung in the air after the trucks’ passage. Mushove and his family were among dozens of households displaced by the $130million-mining project, which began operating in May. They were relocated to new houses built by the mining company about a kilometre from their old homes.

And yet, Mushove is hopeful the mine could “uplift the area and put it on the world map,” he told Climate Home News. For decades, the vast, hard-rock lithium deposits buried under his home were of little interest to foreign investors. Now, Chinese companies are paying a high price to access Zimbabwe’s reserves – the largest in Africa and among the largest in the world.

A lightweight metal with the ability to store lots of energy, lithium is critical for the manufacture of batteries for electric cars. Global efforts to move away from combustion-engine vehicles have pushed demand for the silvery metal, also known as “white gold”, to soar.

Chinese companies have flocked to Zimbabwe’s untapped reserves of high-grade lithium to shore up the country’s supplies, benefiting from the Southern African nation’s cheap labour and deregulated mining sector. In the past two years, Chinese companies invested over $1.4 billion acquiring lithium projects in Zimbabwe.

And more money is on its way. Last year, Chinese companies were awarded licenses that could see $2.79 billion in investment flow into the country, mostly in the mining and energy sectors. These investments could turn Zimbabwe into a key player in the global lithium-ion battery supply chain. Chinese battery manufacturing giant BYD could source some of its lithium from Zimbabwe, after buying a stake in the Chinese owners of the Sabi Star mine.

But Zimbabwe’s poor progress on establishing robust resource governance threatens to keep communities like Mushove’s from seeing any of the benefits, analysts told Climate Home.

While endowed with vast mineral wealth, Zimbabwe has so far failed to turn its underground riches, including diamonds and gold, into revenues for development. Regulatory gapshuman rights abusesillegal trade, and alleged corruption have all been barriers.

recent investigation by NGO Global Witness in Zimbabwe, Namibia, and the Democratic Republic of Congo found that there is a danger of history repeating itself with lithium mining without rigorous screening for corruption and social and environmental harms.

But Zimbabwe’s president Emmerson Mnangagwa is betting on the lithium rush to catapult the country into an upper-middle-income economy by 2030. To achieve this, Mnangagwa aspires to turn Zimbabwe into a battery manufacturing hub.

China’s lithium rush

China towers over the lithium-ion battery supply chain. But its own lithium resources are limited and it has sought to secure access to deposits overseas.

Isolated by the West and slapped with 20 years of sanctions because of human rights violations, Zimbabwe has turned towards China, now the country’s largest foreign investor.

Since the 1950s, China’s foreign policy has been guided by “five principles of peaceful co-existence“, including a commitment not to interfere in another country’s internal affairs. This principle, which encapsulates China’s approach, has set it apart from western investors.

Zimbabwe’s “opacity and disregard for human rights has made it cheap for the Chinese to exploit minerals” in the country, said James Mupfumi, director of the Centre for Research and Development, a local NGO advocating for accountability in the natural resource sector.

Zimbabwean law vests all mineral rights to the president. With no requirements to disclose the beneficial owners of mining projects, “there is no due diligence and parliamentary oversight on Chinese investments,” Mupfumi explained.

“Above all, Zimbabwe requires a government that prioritises public accountability of mineral wealth, not the self-enrichment of a few political elites,” he added.

The ministry of mines did not respond to a request for comment.

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EARTH DAY 2024: Packaging Is the Biggest Driver of Global Plastics Use




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By ,

Earth Day, celebrated annually on April 22, marks a global commitment to environmental protection and sustainability. The first Earth Day took place in 1970, ignited by U.S. Senator Gaylord Nelson of Wisconsin, who aimed to raise awareness about environmental issues and mobilize action to address them. Since then, Earth Day has evolved into a worldwide movement, engaging millions of people across the globe in activities such as tree planting, clean-up campaigns and advocacy for environmental policies. Its organizer is EARTHDAY.ORG, a non-profit organization dedicated to promoting environmental conservation and mobilizing communities to take action for a healthier planet.

The theme of this year’s Earth Day is “Planet vs. Plastics” – a theme chosen to raise awareness of the damage done by plastic to humans, animals and the planet and to promote policies aiming to reduce global plastic production by 60 percent by 2040.

As our chart shows, global plastics use has increased rapidly over the past few decades, growing 250 percent since 1990 to reach 460 million tonnes in 2019, according to the OECD’s Global Plastics Outlook, which projects another 67-percent increase in global plastics use by 2040 and for the world’s annual plastic use to exceed one billion tonnes by 2052. As our chart shows, packaging is the largest driver of global plastics use, which is why a rapid phasing out of all single use plastics by 2030 is one of the policy measures proposed under EARTHDAY.ORG’s 60X40 framework.

Other major applications of plastics include building and construction, transportation as well as textiles, with the fast fashion industry particularly guilty of adding to the world’s plastic footprint. “The fast fashion industry annually produces over 100 billion garments,” the Earth Day organizers write. “Overproduction and overconsumption have transformed the industry, leading to the disposability of fashion. People now buy 60 percent more clothing than 15 years ago, but each item is kept for only half as long.” Most importantly, the organization points out that 85 percent of disposed garments end up in landfills or incinerators, while just 1 percent are being recycled.

  1. Infographic: Packaging Is the Biggest Driver of Global Plastics Use | Statista

Felix Richter is a Data Journalist

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