Title:
Africa as a dumping ground for e-waste:
PHH Theory, from threats to economic and policymaking opportunities
Outline:
1. Introduction
1.1 Problem Statement
1.2 Research Objectives
1.3 Research Methodology
1.4 Scope and Limitations
1.5 Relevance of the Study
1.6 Chapter Summaries
2. Review of Literature
2.1 e-waste: International Setting
2.2 Africa and e-Waste Regulation
2.3 PHH Theory and Moore’s theory
2.4 Implications of PHH for e-Waste Trade
2.5 Formalization of e-waste market
3. Africa as e-Waste Importer
3.1 SWOT analysis
3.1.1 Strengths
3.1.2 Weaknesses
3.1.3 Opportunities
3.1.4 Threats
3.2 PHH in Africa: Threats and Opportunities
3.2.1 Strength-Opportunities Strategies using PHH
3.2.2 Policymaking Requirements
4. Trade Agreements and Multilateral Environmental Agreements
4.1 Existing Trade Agreements
4.2 Existing Multilateral Environmental Agreements
4.3 Weaknesses in Existing Trade Agreements and Multilateral Environmental Agreements
5. Recommendations
5.1 PHH and Understanding e-waste
5.2 Changing from informal to formal e-waste market
5.2.1 Trade agreements and multilateral environmental agreements
5.2.2 e-waste and Economic development
5.2.3 e-waste and Policymaking development
6. Conclusions
CHAPTER 1: INTRODUCTION
Introduction
As the digital age continues to flourish, modern society witnesses a new breed of environmental problems. Before, the primary environmental concerns were waste, acid rain, ozone layer depletion, and global warming. Nowadays, a new kind of waste has emerged as growing international concern- waste electrical and electronic equipment (WEEE) or electronic waste (e-waste) (Nnorom & Osibanjo, 2008, p.1472). Globalization has significantly enhanced the production and consumption of electrical and electronic equipment, as multinational companies (MNCs) and transnational corporations (TNCs) expanded their economies of scale by manufacturing products for global markets (Ndzibah, 2009, p.271). The U.S. produced as estimated amount 2.2 to 3 million tons of e-waste in 2000, which consisted of 859,000 tons of video products, 348,000 tons of audio products and 917,000 tons of information technology products (Gibson &Tierney, 2006, p.322), while an Australian report stated that there is an estimated 234 million items of e‐waste in Australian landfills by the end of 2009, which indicated an increase of 41 million more items than which has been estimated in 2008 (Angel & Brindley, 2009, p.2). In the U.S., only around 9% of the e-waste was reused or recycled (Gibson &Tierney, 2006, p.322). It is clear that developed countries produce a great deal amount of e-waste, which can they cannot manage.
The growth of e-waste can be partially explained by Moore’s Law. This is based on a paper that Gordon Moore, Intel Co-Founder, published 45 years ago. In this paper, Moore predicted that the number of transistors on an integrated circuit would double each year (which was later changed to a doubling that will occur every 18 months). This prediction provided the foundation for another prediction: that doubling the number of transistors would also improve the performance of CPUs twice over every 18 months (Hutcheson, 2009, p.13). Moore, however, was hesitant to call this is a law and emphasized that it was an observation (Hutcheson, 2009, p.13). It was Carver Mead who called it “Moore’s Law” (Hutcheson, 2009, p.13).
Moore’s vision is that engineers will find cost-efficient ways to double the component density of these transistors, which will make end products more affordable in the long run (Alesso & Smith, 2008, p.31). As electrical and electronic products become cheaper, more and more consumers can afford them (Strategic Approach to International Chemicals Management [SAICM], 2009). The environmental implication of this law can be summed up in this statement: Moore’s law predicts the fast rate of obsolescence of technology, which renders more waste in a short period of time, because consumers would also be vulnerable to consuming new technology in shorter durations too. Statistics provided evidence to this observation. In 2005, the EPA provided estimations that the US produced between 1.5 and 1.9 million tons of e-waste (such as computers, TV’s, VCR’s, cell phones, monitors, and others), while the UN Environment Programme noted that around 50 million tons of e-waste is globally produced annually (Carroll, 2008).
The developed countries are the foremost producers and consumers of electrical and electronic equipment, although developing countries, such as China, are becoming world manufacturers also. Recently, developed countries have become more conscious of environmental degradation and have designed stricter environmental regulations. Many have decided to ship off their wastes to pollution havens- the developing countries. The European Commission (EC), for instance, has formulated European Union (EU) legislation that limits the use of hazardous substances in electrical and electronic equipment (Directive 2002/95/EC) and promotes the collection and recycling of such equipment (Directive 2002/96/EC) (European Commission, 2010). These directives have been implemented, since February 2003. The EC recognizes that these directives did not necessarily translate to widespread e-waste recycling or reusing by EU member states: “… only one third of electrical and electronic waste in the European Union is reported as separately collected and appropriately treated. A part of the other two thirds is potentially still going to landfills and to sub-standard treatment sites in or outside the European Union” (European Commission, 2010).
Africa, China, and India are some of the target destinations of WEEE, because they have zero to lax environmental regulations regarding WEEE (Jain & Sareen, 2006; Osibanjo, & Nnorom, 2008; Streicher-Porte et al., 2005). This transnational export of wastes is argued as a negative impact of globalization. Since trade is liberalized, it seems that pollution practices and exports/imports have been liberalized, as well.
e-waste presents opportunities and threats to receiving developing countries. On the one hand, e-waste threatens the health of the people and environmental conditions of developing countries (Jain & Sareen, 2006; Osibanjo, & Nnorom, 2008; Streicher-Porte et al., 2005). e-waste is an environmental concern, because it produces distinctive kinds of environmental damages. An environmental analysis of e-waste reveals that it has high levels of lead, mercury, and cadmium (as well as other toxins), all of which can have detrimental effects on plant, animal, and human health (Kellenberg, 2008, p.3). On the other hand, e-waste presents the opportunities of responding to a new kind of market, the e-waste market, which can be formalized to produce greater economic benefits for pollution havens (Neumayer, 2001; Taylor, 2005). e-waste importation can be regarded as a service provided to developed countries and other nations that do not want to pay for the externalities of keeping and processing e-waste.
The transfer of WEEE from developed to developing countries have contributed to the formation of pollution havens hypothesis (PHH). The PHH can be used to assess environmental externalities in places where e-waste dumping takes place. The pollution havens hypothesis assumes that environmental laws have a strong effect on industrial locations and that different kinds of regulations among countries will, at the minimum, produce specialization and potentially large capital movements to the country with laxer regulations (AkbostanciTunç, & Türüt-Asik, 2004, p.1). This hypothesis indicates that the existence of pollution havens would impact industrial production and trade patterns (AkbostanciTunç, & Türüt-Asik, 2004, p.1). The “dirty industries” will have a larger share in the developing countries, while its share of “clean industries” will decline (AkbostanciTunç, & Türüt-Asik, 2004, p.1). The PHH is viewed as an effective framework for analyzing e-waste management and policymaking for Africa, so that e-waste market threats can be turned into opportunities.
PHH is currently hotly debated, because of its large-scale implications on trade agreements and multilateral environmental agreements (Neumayer, 2001; Taylor, 2005). It can help explain e-waste problems, as well as suggest solutions that can make e-waste a more profitable form of business for e-waste importers (Neumayer, 2001; Taylor, 2005). Africa, which will be the focus of this study, will particularly benefit from the PHH and its inclusion in trade and investment agreements. Since the region has been a large importer of WEEE, it should consider the benefits it must reap from taking in this externality from other countries.
Research Objectives
The opportunities and threats indicate how e-waste importation can produce environmental and health problems for Africa, but Africa can also take advantage of this externality, as the PHH suggests. This paper aims to help Africa turn the threats of pollution havens into opportunities for economic and legislative development, so that it can reap advantages from e-waste importation, without necessarily absorbing hefty externalities.
The research objectives are:
1) To evaluate the threats to and opportunities for Africa in turning the informal e-waste market into a formal market
2) To explore trade agreements and multilateral environmental agreements and how they can be used to the advantage of Africa
Research Methodology
The research methodology involves a critical review of literature regarding the pollution havens hypothesis (PHH) and how it can help alleviate the negative effects of WEEE on African society. The review will be taken from articles from scholarly databases such as EBSCO and ScienceDirect, as well as the Internet. This will allow the author of this study to maximize the time constraint needed to finish the paper. It can also provide an extensive research that would otherwise not be physically possible, if done manually in a traditional library setting.
Scope and Limitations
This paper cannot cover all kinds of WEEE. Instead, it will focus on TV, PCs, and mobile phones, which are products that highly valued and consumed by Africans. This paper is also limited to the resources it can find for this study. It is possible that it may overlook other studies, especially if they are not within the access of the author. It is also hard to acquire more descriptive primary resources for the African situation of WEEE, because African governments have not systematically documented and/or monitored their e-waste importation and practices, due to lack of such policies. The United Nations Environment Programme (UNEP) (2007) stressed that majority of developing countries belong to the second stage of development of WEEE/ E-waste management framework, wherein important WEEE policies are missing or weak. The statuses of WEEE/E-waste in the majority of African and Latin American countries are not available, according to UNEP. Finally, this paper can also not offer a comprehensive and global solution to the e-waste problem. Instead, it attempts to help Africa turn the threats of pollution havens into opportunities for economic and legislative development.
Relevance of the Study
The relevance of this study is that it aims to help Africa develop its policymaking infrastructure, so that it can benefit from being an e-waste importer. The legislative solutions can be integrated into trade and investment agreements, as well as multilateral environmental agreements, so that Africa would not be significantly disadvantaged as it possibly increases its dirty industries to accommodate e-waste importation capacities. The paper attempts to provide recommendations on policies that African governments can consider making as national policies for managing e-waste, so that it can be classified as an entire industry that needs to be regulated on its own.
Furthermore, this paper will contribute to the growing studies on PHH, by adding a legislative nature to the PHH literature. Most of the literature is geared toward economic analysis (such as Akbostanci et al., 2004 and Taylor, 2005), but this paper will go beyond economics and investigate the policymaking impacts and benefits of PHH. It uses the economic perspective, nonetheless, to justify recommended policies. Finally, it aims to help turn the informal e-waste market into a more formal market that can be integrated into the economic development course of Africa. Thus, this paper will be relevant both to the economy of Africa and to the literature of PHH conceptualization and policymaking.
Chapter Summaries
Chapter 2 presents the review of literature. The main purpose of this chapter is to review studies on PHH theory and e-waste in the international and national setting. Chapter 2 reviews the e-waste status in the international setting. It determines who the main exporters and importers are. It also describes Africa’s e-waste regulation system. It depicts studies on PHH theory and Moore’s law, as well as what these studies indicate about the implications of e-waste trade. Chapter 2 also explores studies on e-waste and its relationship with socio-economic development. Finally, it explores studies on formalized markets and how to apply it to e-waste trade.
Chapter 3 illustrates the SWOT analysis for Africa as an e-waste importer. The main purpose of this chapter is to identify the strengths and weaknesses of Africa as a competitive entity for the e-waste industry. In addition, it discusses PHH in Africa. Chapter 3 also identifies the strength-opportunities strategies using PHH. It also identifies policymaking requirements that are needed to attain these strategies and make them work for Africa’s benefit.
Chapter 4 explores present trade agreements and multilateral environmental agreements. It also analyzes weaknesses in existing trade agreements and multilateral environmental agreements of Africa.
Chapter 4 discusses recommendations. It first makes recommendations on how PHH can be used to understand e-waste scenario in Africa. Second, it suggests actions for win-win situations, wherein both exporting and importing countries reap benefits from a well-regulated e-waste industry. The recommendations at this juncture will focus on the suggested arenas that can lead to the formalizing the e-waste market: Trade agreements and multilateral environmental agreements, e-waste and Economic development, and e-waste and Policymaking development.
Chapter Two: Review of Literature
Chapter two presents the review of literature. The main purpose of this chapter is to examine studies on PHH theory and e-waste management in the international and national setting. I will try to determine who the main exporters and importers of e-waste are. It also describes Africa’s e-waste regulation system.
E-waste management in the International and National Setting
E-waste: Definitions
For the past few decades, the electronics industry has changed the world, making electrical and electronic products indispensable to modern living. These appliances include domestic equipments, such as refrigerators, washing machines, mobile phones, personal computers, printers, toys and TVs, which people often dispose of and replace every few years or so.
Moore’s Law helps explain the phenomenal explosion of electronic products. Gordon Moore, Intel Co-Founder, published a paper on Moore’s Law 45 years ago. In this paper, Moore predicted that the number of transistors on an integrated circuit would double each year (which was later changed to a doubling that will occur every 18 months). This prediction provided the foundation for another forecast: that doubling the number of transistors would also improve the performance of CPUs twice over every 18 months (Hutcheson, 2009, p.13). Moore, however, was hesitant to call this is a law and emphasized that it was an observation (Hutcheson, 2009, p.13). It was Carver Mead who called it “Moore’s Law” (Hutcheson, 2009, p.13).
Moore’s vision is that engineers will find cost-efficient ways to double the component density of these transistors, which will make them more powerful and affordable in the long run (Alesso & Smith, 2008, p.31). As electrical and electronic products become cheaper, more and more consumers can afford them (Strategic Approach to International Chemicals Management [SAICM], 2009). As a result, the product life cycle of popular electronic devices has drastically shortened. An example is Intel’s processors. In 1997, the Intel Pentium II 233 MHz processor was released. Two years after that, the Intel Pentium III 500 MHz was launched. More powerful processes meant enhanced computing power and speed, which attracted consumers to update their computers regularly.
The environmental implication of Moore’s Law cannot be understated. Shorter product life cycles meant more electronic waste or e e-waste. More e-waste meant greater burdens for solid waste management. Statistics provide evidence to this observation. See Figure 1 for the growth of computer product sales in the U.S. from 1980 to 2006. Figure 1 shows how sales from desktops rose steeply from the year 1992 to 2000. Sales of desktops continued to increase until 2000, after which sales stabilized. The growth of sales in LCDs is staggering, wherein sales continued to rise from 2002 onwards. Laptops and printers also experienced increasing sales from 2002 and beyond.
Given that numerous consumers change electronic devices periodically, especially those who are technologically “updated,” it is not surprising that e-waste continues to increase at alarming rates as well. Before we proceed in discussing e-waste at the international, as well as selected regional and national levels, it will be important to define e-waste. Its definition provides the scope of e-waste as a new kind of solid waste.
A broad definition for e-waste refers to it as consisting of electronic and electrical devices that no longer have operational and economic value to consumers (Anandakrishnan, Jadhav, & Jagtap, 2008, p.29). A more detailed definition of e-waste comes from the study of Yoshida and Yoshida, which adapts the definition of WEEE (waste electronic and electrical equipment), a more common term used by the European Union (EU) (2010). WEEE pertains to a new kind of waste type, a category that comprises of precious metals and toxic substances as lead (Pb) and polybrominated biphenyls (PBBs), and those whose components entail separate sorting and special treatment for waste management (Yoshida & Yoshida, 2010, p.21). The European Union gave a directive on managing WEEE, which provides the categories of e-waste: large and small household appliances; IT and telecommunications equipment; consumer equipment; lighting equipment; electrical and electronic tools (with the exception of large-scale stationary industrial tools); toys, leisure and sports equipment; medical devices (with the exception of implanted and infected products); monitoring and control instruments; and automatic dispensers. From this list of WEEE, people can only imagine the volume of e-waste produced by one nation every year, especially if it is assumed that people buy something from these categories several times a year (i.e. toys and consumer equipment).
Composition of e-waste
E-wastes contain several persistent, bioaccumulative and toxic substances (PBT) including heavy metals such as lead, nickel, chromium, mercury and persistent organic pollutants such as polychlorinated biphenyls in capacitors in the older models which are still in the market, and brominated flame retardants. Thus globalization of e-waste has adverse environmental and health implications in the downstream end of the electrical and electronic equipment supply chain entailing disposal of waste, as developing countries are economically challenged, lack the infrastructure for sound hazardous waste management including recycling, or effective regulatory frameworks for hazardous chemicals and wastes management.
E-waste contains valuable ferrous (e.g., iron), non-ferrous (e.g., aluminium, copper) and precious and special (e.g., gold, palladium, platinum, silver, indium, gallium) metals that can be obtained from dismantling of computer cases, frames, wires, cables and other components. The rising value of these materials makes recycling more economically viable and attractive.
Product Lifecycle: From Products to E-Wastes
The pattern of product use forms the methodological framework used in this study. This pattern begins at the point the product is purchased and ends with its final disposition. Figure 2 depicts the framework used in this analysis. As shown in the figure, the first phase of a product’s life begins with the purchaser or “first user” of the product. After the first use is Phase 2, in which the product may be given or sold to someone else for reuse, be stored (e.g., in a closet or basement) for a period of time, or undergo some combination of reuse and storage. Phase 2 may include the transfer of the product from one person to another, either as a gift or a sale, but only if this transfer is from individual to individual as opposed to involving a third party, such as an electronics recycler, broker, or donation organization. Phase 3 is the point at which the last user is ready to remove the product from a private home or business. This change can result from the desire to replace or otherwise stop using the product or the desire to remove the product from storage. It is at this point that we state that the product is ready for EOL management and it is transferred to a third party, such as a recycler or donation organization or it is disposed. Once the product is in the hands of a recycler, the product may be sold for reuse “as is” or after some refurbishment. The resale may occur domestically or by firms outside the United States. Electronic devices that are not candidates for resale are dismantled or shredded, and the resulting material is separated into secondary material streams and recovered. Recovered materials from the recycling process are used to make new products, and the residuals of the processing stage are disposed of in a landfill or incinerator. Material recovery may occur domestically or abroad.
Re-use/ Counterfeiting
Re-use constitutes direct second-hand use or use after slight modifications are made to the original functioning equipment-memory upgrades, etc. These computers are later sold in very small numbers at some recycling stores or are given to schools, or non-profit organizations. These older units obviously have a limited life span and will end up as e-waste sooner or later.
Domestic Recycling
The recycling of hazardous materials anywhere creates a serious pollution challenge. It was estimated that in 1998, 11% of computers were being recycled (including those sent for export). And the amount was growing at about 18% per year. It was 12.75 million computers recycled in 2002. The corporate need to destroy confidential information on discarded computers is another incentive to recycle.
Dismantling and Scrapping
Removal of part containing dangerous substances (CFCs, Hg switches, PCB); removal of easily accessible parts containing valuable substances (cable containing copper, aluminium, steel, iron, precious metal containing parts, e.g. contacts). Scrapping of ferrous metal, non-ferrous metal and plastic is done. This separation is normally done in a shredder process.
Export to Developing Countries
The most often overlooked and ignored E-waste management option - export to developing countries under the name of "recycling". There are three primary reasons why E-waste is increasingly flooding Asian countries:
• The labor costs are very low (India- $1.00 per day);
• Environmental and occupational regulations are careless or not well enforced; and
• It is legal in the countries like U.S., despite international law to the opposing, to allow export of hazardous E-wastes with no controls whatsoever.
UK e-Waste Scenario
The United Kingdom (UK) generates around 15% of the EU’s total waste electronic and electrical equipment (WEEE) (Parliamentary Office of Science and Technology [POST], 2007, p.1). Around 940,000 tons of UK’s 300 million tons of waste a year come from domestic sources. See Table 1. The Parliamentary Office of Science and Technology (POST), reported: “On average, each UK householder disposes of approximately four pieces of WEEE a year. This type of waste is growing three times faster than any other municipal waste stream” (p.1).
Table 1: Tonnages and units of WEEE discarded in the UK in 2003
| Type | Tonnage discarded
(thousands of tons) | Units discarded
(millions) |
| Large household appliances | 644 | 14 |
| Consumer
equipment | 120 | 12 |
| Small household
appliances | 80 | 30 |
| IT & telecoms
equipment | 68 | 21 |
| Other | 28 | 17 |
| TOTAL | 940 | 94 |
Source: Industry Council for Electronic Equipment Recycling, 2005
Disposal of WEEE
For some kinds of WEEE, there are recognized markets for recycling and/or reuse (POST, 2007, p.1). For instance, a number of large household appliances (‘white goods’) such as refrigerators and washing machines are recycled on a wider basis because of the following reasons: regulations imposed in 2002 requiring that waste fridges and freezers are processed to eliminate ozone depleting substances before scrapping; they are recycled for their precious scrap metal content (POST, 2007, p.1).
For other consumer items that are smaller, such as small household appliances, power tools or electronic toys, the market for re-use, or for their component materials to be recycled in the UK, is not yet that developed (POST, 2007, p.1). There are also limited benefits in recycling them (POST, 2007, p.1). This means they come into the domestic waste stream unprocessed, typically in landfill (POST, 2007, p.1). The UK signed new legislation in January 2007, to decrease WEEE, to sustain greater recycling and re-use, and to advance the monitoring of final disposal of materials. However, recycling of many kinds of e-waste remain underdeveloped (POST, 2007, p.1).
The European Directive for WEEE
The dumping and low rates of recycling of electronic and electrical appliances, numerous of which containing toxic factors, may create environmental hazards (POST, 2007, p.1). In order to avert the hazards that come with WEEE, the EU approved the latest producer responsibility legislation in 2002, an EU Directive for WEEE (2002/96/EC) (POST, 2007, p.1). Under this, producers are made responsible for their product at the end of their useful life (POST, 2007, p.1).Its main goal is to reduce the environmental impact of an electronic product’s entire life, not just at the point where it becomes waste (POST, 2007, p.2). This directive aims that by exerting the end-of-life cost on producers, this will act as a motivation for them to create longer-lived products, that utilize fewer resources and dangerous materials, spawn less waste, and are safer and easier to recycle (POST, 2007, p.2). It also provides mechanisms, by which household and commercial WEEE should be classified, collected, treated and documented (POST, 2007, p.2). Two more EU Directives also apply to the management of electrical and electronic goods and they are the following:
· The Energy Using Products Directive (2005), which was implemented last 2007. It does not relate to waste but seeks to enhance the environmental performance of energy-using products during their whole life, by acknowledging the environmental performance at the design phase (POST, 2007, p.2).
· The Restriction on the Use of Hazardous Substances Directive was implemented in the UK in July 2006. It controls the employment of particular hazardous materials that are frequently used in electrical products, such as lead, mercury and some types of flame retardants (POST, 2007, p.2).
The enforcement of the WEEE Directive Transposition of the Directive is the responsibility of the Department of Business, Enterprise and Regulatory Reform (DBERR, previously the Department for Trade and Industry or DTI), while the Department for the Environment, Food and Rural Affairs (Defra) is accountable for licensing WEEE treatment facilities (POST, 2007, p.2). The Environment Agency (EA) is the enforcement organization in England and Wales, the Scottish Environment Protection Agency in Scotland and the Environment and Heritage Service in Northern Ireland (POST, 2007, p.2).
The UK aims to accumulate a minimum level of WEEE, amounting to 4kg/person/year, and attain a number of other recovery, recycling, reuse and treatment targets. The legislation necessitates the division of WEEE from other waste streams, so that dangerous substances can be eliminated, while mounting recycling rates. WEEE treatment does not have to happen in the UK provided as long as the EU standards are attained and the waste export rules are followed.
Consumer awareness.
The WEEE Directive implemented the new labeling of equipment with a symbol of a crossed-out wheelie bin to designate that the goods should not be discarded alongside municipal waste (POST, 2007, p.2). Aside from this, there is no other indication of how the public is informed of how WEEE will be handled by either local retailers, or local authority waste facilities (POST, 2007, p.2). The DBERR and the EA conducted awareness raising events in 2007, but these are focused on improving compliance by businesses instead of educating householders (POST, 2007, p.2). Greenpeace tries to improve the awareness of consumers about the use of hazardous chemicals in electronic goods.
Developing Countries/Regions
China. In China, the use and obsolescence of both electronic and electrical equipment have risen expediently in the recent years, especially as the economic expanded rapidly. China has also started certain measures to manage e-waste problem since it experienced rapid industrialization and urbanization in the 1990s. See Figure 2. Route 1 in Figure 2 shows leaves Europe and proceeds to Africa and China. Route 2 shows the concentration of e-waste in several parts in China, from e-waste coming from the U.S. These routes show how e-trade has become an international business, wherein e-waste predominantly comes from developed countries and flows into developing countries.
Africa. In July 2000, the Group of Eight Developed countries, G8, created the ‘Okinawa Charter on Global Information Society’ at the Okinawa Summit in Japan. This is a proposal to link the ‘digital divide’, which seeks to enhance access to communication technologies in the world's poorer countries. This Charter and other related efforts advanced information and communication technologies (ICT) in developing countries including Nigeria (Sarkisyan, 2007).
In 2000, Nigeria had merely 500,000 major lines operational from a capacity of 700,000 and barely 30,000 analogue mobile telephony lines equipped with one of the lowest teledensity rates in the world (Osibanjo & Nnorom, 2008, p.199). This has drastically changed after the coming of four operator of the global system for mobile communication (GSM) (Osibanjo & Nnorom, 2008, p.199). At present, more Nigerians own mobile telephones and the mobile phone is playing a large part in the development of the Nigerian economy (Osibanjo & Nnorom, 2008, p.199). Mobile telephony has even expanded more than landline telephony, making mobile phones more ubiquitous than landlines (Osibanjo & Nnorom, 2008, p.199).
The study by Osibanjo and Nnorom (2008) explored the international material flow and waste production in the mobile telecom sector, the development of mobile telecom in Nigeria and the current waste management practices for wastes from the sector in the country. Their survey indicated that on the average, mobile phone users in Nigeria buy a new mobile phone battery and charger twice a year (p.204). This creates total waste of 3000 t and 9500 t correspondingly for the period 2001–2006. By 2007, a projected 8 million mobile phones that could weigh around 1200 t would have become outdated in the country (Osibanjo & Nnorom, 2008, p.204). They also observed the lack of safe and integrated e-waste management system in Nigeria. They suggested that in order to attain effective management of e-waste, there must be a well-coordinated network for the collection and recycling of e-wastes. In another study, Nnorom and Osibanjo (2008) examined material flows and management practices in Nigeria. Findings showed that the majority of developing countries including Nigeria lack a comprehensive system for separation, storage, collection, transportation, and disposal of waste and it also does not have an effective enforcement of regulations that concern hazardous waste management. There is also no particular legislation for management of e-waste and there is negligent enforcement of present of general waste management. E-waste recycling and importing is also considered as an informal market, lacking in efficient technologies and hi-tech recycling means. Thus, e-waste management is largely done through low-end management means, such as dumping in open dumps, backyard recycling and dumping into water bodies. These studies indicate poor e-waste management legislation and formal market networks in Nigeria, which can reflect the same across Africa which accepts e-waste from other countries.
PHH Hypothesis
There has been emerging focus on the pollution haven hypothesis (PHH), although there is no agreement on what pollution haven truly is (Kellenberg, 2008). Public opinion showed that a country with poor environmental regulations easily offer a pollution haven (Neumayer, 2001, p.147). Neumayer (2001) argued that this cannot be an accurate definition, because people cannot expect that all countries will apply the same standards of environmental management. He noted that this will be the same kind of definition provided by Eskeland and Harrison (1997, p. 4):
The pollution haven hypothesis is, perhaps, best seen as a corollary to the theory of comparative advantage: as pollution control costs begin to matter for some industries in some countries, other countries should gain comparative advantage in those industries, if pollution control costs are lower there (for whatever reason).
Neumayer (2001) stressed that cost differentials alone will lead to overlooking other reasons, wherein some countries still have low environmental standards, but they still do not draw sufficient foreign capital (p.147).
Neumayer (2001) proposed a different definition of PHH: “A country provides a pollution haven if it sets its environmental standards below the socially efficient level or fails to enforce its standards in order to attract foreign investment from countries with higher standards or countries that better enforce their standards” (p.148). Using economic terms, “environmental standards are at their socially efficient level if for each different pollutant the standard is set such that the marginal social benefit of an increase in pollution is just equal to the marginal social cost of such an increase” (p.148). In other words, if environmental standards are inefficiently low, then there is unwarranted pollution relative to people’s preferences. Given this definition, he reviewed the existence of pollution havens using the review of literature. Findings showed that PHH is hard to prove, when developing countries do not low environmental standards for purposes of inviting e-waste. Author concluded that since discrimination between efficiently low environmental standards and authentic pollution havens is rather complicated to accomplish, the more imperative it becomes that policy options dealing with (possible) pollution havens are development friendly, not open to abuse, and not unreasonably restrictive—precisely the criteria on which support for political-institutional capacity building and local empowerment could thrive.
The study by Kellenberg (2008) explored consumption externalities, backhauling, and pollution havens. He made a theory of consumer-generated waste trade that is affected by changes in endogenously determined shipping costs. Trade deficits, shipping market qualities, country attributes, and physical attributes of final goods are revealed to play an imperative role in shipping costs, a decisive constituent for a country’s resolution to export harmful waste or dispose of it at home. Findings showed that when the shipping industry is illustrated by imperfectly competitive firms with capacity limits, asymmetries can endogenously happen between the headhaul and backhaul shipping rates between the countries (Kellenberg, 2008, p.6). These asymmetries can rationalize that the North will be better off in transporting its waste to the South. This is because lowering shipping costs from North to South increases the incentive of just paying lower tax for waste disposal in the South, including shipping costs, instead of paying higher tax in the North (Kellenberg, 2008, p.6). However, the study also noted that when the South is incapable of enforcing the optimal Pigouvian tax, South welfare falls even more; and incurs a loss in trade in shipping cost and disutility from waste pollution (Kellenberg, 2008, p.6). This study shows the importance of setting the right taxes of accepting e-waste in Africa, which nonetheless, should be lower than the shipping costs of managing e-waste in the North.
Taylor (2005) aimed to “unbundle” the PHH. The result of this unbundling can be seen in Figure 2. The hypothesis provides as given the country characteristics such as access to a variety of production technologies, opportunities for abatement, and country specific endowments of productive factors. These country characteristics, including the world prices, establish national income which in turn is included into the strictness of environmental regulation at a). The mapping is made by a social planner who applies an efficient solution needed by the set of identical agents in the economy. The efficient solution is then applied through a tax on pollution (or any other efficient mechanism). This tax influences the costs of goods production in the economy. This article is important in understanding the trade-offs involved for countries that choose to be pollution havens. He makes three important conclusions: 1) environmental regulation is critical to production and trade flows, 2) regulatory effects are imperative but trade in dirty goods is also affected by a multitude of other factors: capital abundance, industry factor intensities, the quality of governance as measured by say corruption, and other political economy determinants, and 3) relationship between trade, technology and the environment is not well understood but could be very central to e-waste trade (Taylor, 2005, pp.25-26).
Figure 2: Unbundled PHH
Source: Taylor (2005, p.8)
Conclusion
The generation of e-waste has exploded, as Murphy’s law showed how easy it is to improve electronic products through technology, thereby cutting life cycles short. Current technology also makes it cheaper to produce more advanced products, which also attracts continuous consumption of new electronic products. The downside of producing and purchasing new products is the rise of e-waste. E-waste, however, produces an incentive for developing countries as a new source of income. It is possible that they can accommodate this externality and gain additional streams of revenues.
Studies showed that e-waste will continue to grow at an unprecedented rate and that pollutions havens can gain from international e-waste trade. The pollutions haven hypothesis helps explain the migration of e-waste from developed countries to developing countries, as the latter employ less efficient environmental laws. These environmental laws, however, do not always assure optimal income for developing countries. Taxes and agreement should be present, wherein the importers of e-waste can accommodate this externality at a lower marginal social cost.
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