The Garbage Economy

With 50 million tons of waste, the Estrutural Dump in the Brazilian capital of Brasilia is the largest dump in Latin America. After operating for nearly 70 years, the expansive waste pile was shut down earlier this month by the Brazilian government due to a rising risk of water supply contamination. While the shutdown of Estrutural was long overdue, it will have a devastating effect on the tens of thousands of nearby shantytown residents who live alongside the dump and depend on it to support their livelihood.

The global recycling market is worth billions of dollars annually and is only increasing in size as the cost of processing virgin materials rises and consumers become more eco-conscious. In much of the developing world, including Brazil, the bottom level of the recycling industry’s supply chain is facilitated by scavengers who scour landfills and dumps in search of recyclable materials they can sell for reuse or recycling. The United Nations estimates that In African, Asian, and Latin American cities approximately 1% of the urban population, roughly 15 million people, make their living by scavenging.

Due to the informal nature of the scavenging business, reliable quantifications of its economic contribution are impossible, but it ranges into the billions. In Mumbai, India alone the economic impact of scavenging activities is believed to be $1 billion. Not only are the scavengers dependent on materials plucked from garbage piles, but so are the many businesses that have popped up in the scavenger towns nearby major dumps.

In regard to the Estrutural Dump, the Brazilian government faced a no-win situation. They had to shut down the dump to protect the environment and water supply, but in the process, they eliminated the income source of tens of thousands, thereby devastating local shantytown economies. The Brazilian government is attempting to support newly unemployed scavengers by offering them government jobs at modernized waste removal and sanitation facilities, but their promises ring hollow for many scavengers who lack faith in the government and are disinterested in parting from their entrepreneurial way of life.