How is Brexit affecting the plastic industry?

Ever since citizens of the UK voted to leave the EU on Thursday June 23^rd 2016, there has been of talk about how the move will affect different parts of the Britain’s economy. This includes the impact Brexit will have on the UK’s modern commercial plastic industry — a sector that has existed since the 19^th century, and has grown to become a global leader that operates at the cutting edge of technology and plays an important part in the nation’s economic strength.

Will the UK leaving the EU affect the nation’s plastic industry for the better or the worse? Five-star plastic sheet supplier The Plastic People investigates…

Understanding how important the plastics industry is to the UK

Figures gathered by the British Plastics Federation (BPF) showcase just how important the plastic industry is for the UK’s economy.

In 2015, the organisation found that there were 3.3 million tonnes of plastics material processed and 1.7 million tonnes of plastics materials produced within the UK plastic industry. To carry out this large amount of work, more than 170,000 people are employed across this sector — only the food and drink industry employs more individuals within UK manufacturing, with the nation’s plastics industry having a higher approximate direct employment figure than the automotive manufacturing, defence, furniture, bed and furnishings sectors.

There are also 5,200 manufacturers of plastic products and 6,200 associated companies to be found throughout the nation.

When it comes to monetary value, the UK plastics industry achieved £13.1 billion of processor sales turnover in 2015 and £23.5 billion is the plastic industry’s turnover figure.

It is important to point out that plastics were one of the UK’s top ten exports as of 2015. More than 30 per cent of plastic and plastic products were exported, and the value of the exports calculated in at £7.5 billion — £4.9 billion of this being accounted for by the EU28 and the remaining £2.6 billion to the rest of the world.

The BPF’s Brexit Taskforce

It’s clear from the figures above that the plastics industry is a vital part of the UK’s economy. To ensure that the BPF remains a representative voice to this sector during uncertain times, the organisation set up its ‘Brexit Taskforce’.

Chaired by Mike Boswell, a former president of the BPF, and consisting of a collection of senior figures from throughout the UK’s plastics industry, the aim of the group is for them to be a powerful voice through expert input from representatives while carrying out surveys of BPF members.

Main priorities for the plastic industry in Brexit negotiations

As well as setting up its ‘Brexit Taskforce’ following the UK’s decision to leave the EU, the BPF has also outlined what it believes to be the four main priorities that those in or associated with the plastic industry has to keep in mind throughout the Brexit negotiations. These are as follows:

1. Have free access to the single market

As mentioned, plastics are among the UK’s top ten exports. What’s more, the EU is the single most important trading partner for the UK in regards to plastic materials and products. Add to this the fact that the nation’s plastic industry is heavily reliant on imports — more so than other global players, which is highlighted by the fact the nation exported £1.8 billion of raw materials to EU member states but imported £3.8 billion of the same materials — and it’s vital that easy access to this market is maintained post-Brexit.

2. Have access to skills

The BPF has found in its research that 92 per cent of companies in the UK’s plastic industry are either ‘concerned’ or ‘very concerned’ about the lack of skills that are supporting their business. 46 per cent are also having difficulty recruiting and skills shortages outlined include those covering everything from technically literate sales staff and shop floor staff to apprentices, engineers, technicians and technical managers.

Add all of this together and it goes without saying that those in the nation’s plastic industry need reassurance that existing EU workers within the sector are able to stay to carry on their duties, as well as the guarantee that they can gain access to more skilled workers in the years to come.

What is also important to note, is that non-UK EU citizens make up a large pool of those in employment in the UK’s plastic industry. In fact, an estimated 18,000 of those who work in the sector are EU citizens (4,000 are from the rest of the world as well), with one in five of those being in high-skilled positions and a further 25 per cent in mid-skilled roles.

3. Maintain and then develop legislation compatible with the EU

There is no denying that EU legislation shapes the UK plastic industry rather heavily at the moment. The BPF has called the need for regulatory equivalence between the UK and EU post-Brexit to be “highly important” so to maintain cost-effective access to the single market. Legislation that the organisation has called to be maintained and developed include for the following EU regulations and directives:

Circular Economy Package
Classification, Labelling and Packaging (CLP) Regulation
End-of-Life Vehicles Directive
Landfill Directive
Materials and Articles in Contact with Food Regulation
Packaging & Packaging Waste Directive
REACH — Registration, Evaluation, Authorisation and Restriction of Chemicals
Restriction of the Use of Certain Hazardous Substances (RoHS) Directive
Waste Electrical and Electronic Equipment (WEEE) Directive
Waste Framework Directive

4. Provide support for innovation and business development overseas

The BPF has also called on an increase in support for both innovation and funding for overseas business development, on top of establishing incentives for reshoring.

By doing so, the organisation is confident that the UK will continue to be at the forefront of the global plastics industry, as well as enable the nation to remain one of the world leaders when it comes to innovation and design in plastics.

Concerns regarding plastic recycling post-Brexit

It is not just the working practices of the plastics industry that will need to be looked into as we head towards a post-Brexit age. This is because leading EU figures and environmental groups have recently warned that the UK will not be bound by a new deal that is being drawn up by the EU for its ambitious circular economy plan once the nation is outside of the EU.

The strategy in question relates to one where manufacturers will be required to take a greater responsibility for the way they dispose of, collect and recycle the billions of plastic bottles that are produced on an annual basis.

However, the EU environment committee’s vice-chair Javor Benedek pointed out to The Guardian: “The UK risks falling behind the rest of the EU in the way that it deals with the issue of plastic waste and plastic bottles, with little effort for waste prevention and better recycling, less onus on big producers to take responsibility and ultimately more plastic ending up in illegal dump sites or the ocean.”

Pieter Depous, the European Environmental Bureau’s policy director, was also keen to state: “There will be fewer incentives to manufacture reusable and recyclable packaging solutions, which will in turn lead to more resources being used and more plastic ending up in the ocean.”

However, a spokesperson for Defra, has acknowledged: “We have made great progress in boosting recycling rates for plastic bottles, with their collection for recycling rising from less than 13,000 tonnes in 2000 to over 330,000 tonnes in 2015.

“We will continue to address the impacts of plastics waste as we leave the EU, as part of our ambition to be the first generation to leave the environment in a better state.”