Internet adds spin to China's circular economy

BEIJING - Life has been hard for Jin Yuhua and her husband. They moved from Shandong province in 1997 and have worked as trash collectors in north Beijing since. In sweltering heat and freezing cold, they sit on an old tricycle outside a housing compound, waiting for someone to buy rubbish that has a tradable value -- newspapers, plastics bottles, old appliances and the like.

The development of the Internet seemed almost irrelevant to their livelihood, but an O2O (online to offline) application is now changing their lives.

When they began to use Bangdaojia, an application that allows users to request a garbage pickup on their smart phones, they went from waiting aimlessly in the street to offering a door-to-door service by appointment. And much to their surprise, application developer Beijing Incom Resources Recovery Co Ltd offered them formal employment.

Incom built its reputation on its plastic-bottle collecting machines that reward depositors. By the end of 2015, Incom had recycled 18 million plastic bottles in Beijing through more than 3,000 machines.

Incom general manager Chang Tao believes the machines, based on the Internet of Things, have something in common with the O2O application: they are changing the final destiny of rubbish.

Like many other garbage collectors in China, Jin and her husband are the start of the long recycling chain. They usually sell garbage to small waste collection agencies, which will resell it to recycling enterprises. As the cost of processing recyclable materials is high for licensed recycling enterprises, says Chang, their price offers are less competitive than unlicensed agencies. As a result, a lot of garbage goes to underground collection and processing centers.

"I have been to some illegal processing centers on the outskirts of Beijing that exude a pungent smell. They don't have sewage treatment or proper environmental protection facilities. The chemicals are discharged into rivers or the earth, causing secondary pollution," Chang says.

"Incorporating Internet technology into the recycling chain not only expands the raw materials base, but also shows us who is recycling and where. We use the Internet to monitor recycled garbage and make sure it goes to legitimate factories where it is processed without pollution."

The recycling sector is one of the beneficiaries of Chinese government's "Internet Plus" initiative to enable more businesses to harness the Internet.

GEM, a listed company and one of the forerunners in China's recycling industry, is trying to make a difference with the Internet. GEM launched its O2O platform Recycling Brother in Shenzhen in August 2015 and promoted it in other cities including Wuhan, Jingmen and Tianjin. Users can sell any kind of trash that has a recycling value through the platform's detailed refuse classification. With more than 3,000 offline garbage collectors joining the project, the platform's daily collection reaches 300 tons.

Zhang Yuping, general manager of the Recycling Brother, says GEM has strengthened capacity in recycling materials since it was established on 2001, but encountered bottleneck in development.

"The problem is the lack of raw materials, which is also a problem for China's recycling industry. We are competing with underground collection centers and I hope this O2O platform that allows us to collect materials directly from the user will help," Zhang says.

More than eight cities, including Beijing and Shenzhen, have been exploring refuse classification since 2000, but so much is still randomly discarded due to the lack of workable methods and poor public awareness.Zhang says the O2O platform's detailed refuse classification system to some extent solves the problem of incomplete waste sorting. And the rewards for selling garbage will promote the "trash-to-treasure" concept and encourage more people to participate.

"The 'Internet+Recycle' mode is viable commercially and environmentally. We have carried out extensive cooperation with local governments and hope the joint efforts of government, enterprise and individual will promote the circular economy," Zhang says.

China's Central Urban Work Conference held in December 2015 called for creative city management. Pan Yonggang, vice president of the China Resource Recycling Association, thinks 'Internet+Recycle' helps the government to promote management standards and innovation.

"The contribution made by thousands of migrant workers like Jin Yuhua, has been indispensable to China's recycling industry. The new trend is turning them into more-organized industry workers, to build a healthy collection system, which is essential to develop a circular economy," Pan says.

With recycling enterprises benefiting from the Internet, some Internet-based start-ups such as Zai Shenghuo and Ai Huishou have also branched into the recycling industry.

Pan is happy to see this, but he also advises that O2O-based refuse collection cannot survive without proper offline garbage management: "A well-Integrated recycling system needs both."