Can SMEs unlock scalable solutions for Africa’s waste crisis?

From the newsletter

Ten small and medium enterprises (SMEs) in Ghana have benefitted from $4.35 million financing from the government to pilot innovative plastic solutions. The funding is part of the government’s $7 million Circular Economy Framework for the Plastics Sector (CEF-PS) that’s funded by the Global Environment Facility (GEF).

• SMEs often drive innovation on Africa’s waste frontlines, yet public funding rarely follows. Ghana’s move to invest in ten local firms breaks from the norm—aligning policy with practice and giving homegrown solutions a seat at the table.

• UNIDO’s support of the SME initiative in Ghana hints at a changing development model—one that puts African enterprises at the heart of scalable solutions. If replicated, this could reset how international funding reaches those closest to the problem.

More details

• Ghana generates about 840,000 tonnes of plastic waste annually, but only 9.5% is recycled. The rest ends up in drains, open spaces, or marine environments—damaging ecosystems and worsening urban flooding.

• Implemented by the United Nations Industrial Development Organization (UNIDO), the CEF-PS project aims to alleviate this by recovering 93,000 tonnes of plastic waste, preventing 13,000 tonnes of marine litter, and training over 2,000 stakeholders on circular economy practices over five years. It also targets the creation of 746 direct and 9,684 indirect jobs, as envisioned in Ghana’s National Plastics Management Policy approved in 2020.

• The ten funded SMEs include Coliba Waste Management Services Ltd, McKingtorch Africa, Nelplast Eco Ghana Ltd, IRECOP/Zoomlion, Maintenance Sustainability Africa, UPPR, Pure Home Water, and three consortiums: Asase, Sesa, and City Waste Recycling.

• Projects will cover biodegradable plastics, food- and construction-grade recycling, and community collection systems. Plans include six community buy-back centers, recovery of 10 tonnes of plastic bags, and production of 3,457 tonnes of pavement blocks from recycled waste.

• Across Africa, SMEs are the engine behind waste management innovation—yet they’re largely shut out of national planning and procurement systems. Public funding and policy often favor multinational companies with deep capital and political networks, leaving local enterprises to operate informally with limited visibility.

• Development funding has traditionally flowed through governments or large contractors. While efficient in theory, this model sidelines Africa’s most dynamic players—community-rooted SMEs that are quick to innovate and responsive to local realities. Ghana’s approach could reframe these enterprises as central actors in circular transition—not peripheral players.

• Despite limited support, SMEs are frequently the first responders to the continent’s waste crisis. They run small recycling ventures, organise grassroots clean-ups, and transform plastic waste into useful products like pavement blocks and biodegradable packaging. Positioned at the intersection of necessity and innovation, they are essential to Africa’s circular economy.

• In Central Africa, Rwanda’s Urumuri Initiative is working to close this support gap. Launched in March 2025, the program will provide training, technical assistance, and interest-free loans to 135 recycling-focused SMEs nationwide. Backed by GIZ Rwanda and the BK Foundation, the initiative signals growing regional interest in SME-led circular economy solutions.

• In Nigeria, Wecyclers has become a standout. Using cargo bikes and SMS technology, it collects recyclables from underserved areas and rewards participation—creating jobs while cleaning communities, without relying on government systems.

• Uganda’s Yo Waste brings a digital solution, connecting households to collectors through a mobile app. Its platform improves efficiency and generates real-time waste data—useful for urban planners and policy. In neighboring Kenya Ecopost Limited turns plastic waste into durable, eco-friendly fencing posts.

• Meanwhile in Zambia, Recyclebot is democratising recycling with open-source hardware for sorting waste. By equipping local recyclers with affordable tech, it fuels grassroots innovation hubs and boosts recovery efficiency.

• Yet even high-impact SMEs face structural barriers. Access to capital remains a top constraint. Many can’t qualify for loans or attract investors, relying instead on short-term grants. Infrastructure gaps also persist—most public investments in waste systems bypass SMEs, leaving them with outdated tools and fragmented operations.

• Still, these enterprises continue to lead where others lag. They understand local contexts, adapt quickly, and fill gaps that governments and corporations overlook. With the right policy backing, infrastructure support, and long-term financing, SMEs could unlock scalable solutions to Africa’s waste crisis.

Our take

• Africa’s SMEs are solving waste problems daily, yet funding flows and policy priorities continue to overlook them. If governments want scalable solutions, they must stop treating local enterprises as marginal and start treating them as foundational.

• From Wecyclers to Recyclebot, African startups are doing the hard work. But innovation can't scale without infrastructure. Governments must rethink how waste infrastructure is financed, with SMEs at the center—not just as beneficiaries, but as partners.

• Recycling start-ups don’t need charity—they need capital. Grant-heavy models are unsustainable. Investors and policymakers must recognise the business value of SMEs in waste management and create pathways for long-term investment that match their potential for social and environmental returns.