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The Future of Plastic Economy

Updated: Apr 11, 2023

The objective of this article is not to inform you of the environmental issues regarding plastic. Rather, it is to provide a boarder economic evaluation in my three selective areas of the plastic economy: Sustainable business practices, upcycling, and biodiversity. I believe sustainable investment strategy is important and it can be achieved by ongoing learning and development.

Plastic is the focal point of study in the base material sector and forward looking defensive investment sector of the economy. The United States imported $61.85B and exported $66.56 Billion of plastic during 2018, according to the United Nations COMTRADE database on international trade. The following graph shows us the demand of plastic in the US alone.

1. Sustainable Business Practices

The development of plastic reuse, refurnish, remanufacture, and redistribution, especially in the business-to-business segment, is an area investors should pay close attention in the consumer business segment, such as packaging, building material, clothing, automotive, furniture and electronics. Another area to watch is technology implementation and system development in the circular economy on making and using plastics (i.e. the energy recovery process, pollution control and potential carbon savings). The companies who adopt sustainable business practice in these areas will also capture significant customer confidence and loyalty, and in return they will receive profitability and higher share value.

2. Upcycling

Currently 5% of the material value of plastic packaging is captured after one use cycle according to a study from Science Direct. Recycling of plastics into similar quality, lower value material recycled with Eco efficiently, reusable bags or another material will continue to be the framework on asset utilizations and material science. It also plays a critical evaluation on other economic development areas, such as water waste, ozone depletion, energy consumption, eutrophication, and polyester production, which is often used in fabrics. The development in upcycling goes head on with the growth potential of the plastic economy.

3. Biodiversity

Biodiversity is more than just a global environmental issue. It is also an economic issue for the health, agriculture and energy sectors as it affects how natural medicines, organic contents (such as food) and fossil fuels can be made available for consumers. Take a case of feedstock. Predicting the cost of fossil feedstock based on plastics is very difficult. Fossil feedstock is considered a commodity, and the price volatility in any commodity is subject to the local market changes for which can’t accurately forecast or time. Therefore, it is a passive and ineffective strategy to control the cost of fossil feedstock for long term economic cost and return trade off. But, one can argue that we can use the data to calculate how much can be saved on resilience in new plastic materials. Therefore, company aims on saving the biodiversity on our planet is a proactive approach for which it achieves the balance between saving the ecosystem and reducing the long term cost down on the road. This is an important focus for the energy and health sector to increase cost competitiveness and long term sustainable growth.

In conclusion, investors should pay close attention to the future of the plastic economy. It is not just good for the general human race. It is also an essential part of our global economy, because plastic exists everywhere, even including the keyboard I am using to write this paper. We ought to look for long term investment themes and not be short sighted with current market events. By evaluating a company’s plan of action in sustainable business practice, upcycling and biodiversity, it is the factor an investor can focus on.


Kimmy Wan has more than 20 years of experience in financial services industry.

Kimmy was a Vice President-Sr. Financial Consultant, Manager of Asia Pacific Relationship Management and a Mutual Fund Operation Analyst for Fortune 500 Financial Corporations. Kimmy is a wealth advisor helping those who are retired as well as those planning for retirement. She graduated from California State University, Sacramento in 1998 with a B.S. degree in Finance and Economics and then obtained her MBA in Finance from the University of Phoenix.

Kimmy specializes in modern portfolio management, risk management, financial planning, and investment strategic planning. Kimmy has native fluency in Chinese Mandarin and Cantonese.



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