“Thousands of illegal landfilling sites in Serbia” are holding back recycling efforts in that European nation, according to Dr. Beate Kummer of Germany-based scrap recycling firm Scholz Holding GmbH. Kummer gave a presentation on the topic at the Eco Expo Fair March 19, 2015, in Belgrade, Serbia.
Scholz Holding has invested €20 million (US$21.4 million) since 2001 to improve environmental standards at its sites in Serbia, says Kummer, but “right now there is no legal certainty for recyclers and no fair competition.”
Kummer estimates that there are 10 times more illegal operators than legal recyclers in Serbia. He says the illegal companies are working in “gray zones” in the Serbian economy. “Approximately 3,000 small illegal scrap yards are operating in the metal scrap recycling industry; beside that there are more than 2,000 illegal dumping sites for waste,” he comments. “It is a fact that inspectors do not control that gray market—only legal operators are visited by authorities.”
The illegal operators affect the market in several ways, Kummer adds. “Within ports that are used for exporting recycled material, metal scrap trading companies started their illegal operations. Illegal-acting companies use ports for storage and handling scrap, which reduces their costs. A high amount of scrap trading in Serbia is done with cash in the gray zone with significant tax evasion.”
Kummer continues, “The biggest problem in Serbia is there are laws and other standards already harmonized with EU legislation, but they are not applied. Before 2012, importers of [end-of-life] vehicles paid fees to the fund for Environmental Protection, which was later distributed for the recovery of ELVs (end-of-life vehicles).”
However, says Kummer, “Since Serbia got a new government in 2012 the responsibility for the environmental sector was integrated into the Ministry of Agriculture. Afterwards, the market and regulatory conditions in Serbia worsened. A declining local scrap market, combined with the integration of the Environmental Protection Ministry into the Ministry of Agriculture, [created] a regulatory vacuum [that] spurred the entry of illegal competitors.”
To remedy the situation, Scholz and Kummer recommend the following actions in Serbia:
- Implementation and enforcement of waste management laws regarding EU standards, especially the new EU waste framework directive;
- the installation of an environment ministry or at least detailed responsibility for a task force within the Ministry of Agriculture or the Ministry of Economics; and
- closing down illegal dumping sites and illegal operating companies in the waste management and recycling sectors.
Kummer says Scholz Group entered the Serbian market with initial investments in 2001. Scholz currently operates there through the Centar Group, which processed more than 200,000 tons of scrap worth €66 million ($70.5 million) in 2013.