Household Expenditures, Indonesia

FIGURE 4.10 Household Expenditures on Plastic Utility as a Share of Total Household Expenditures, Indonesia

Household expenditure on plastic/plastic utility, % 11 10 9 8 7 6 5 4 3 2 1

0 2020 +5%

2025 2030 2035 –24%

2040

CP scenario IPR scenario

Source: Adapted from World Bank 2022a. Note: CP = current policies; IPR = integrated policy reform.

products, however, leading to lower total spending on plastic packaging. Lower household spending on new plastic products is partly offset by the increase of the cost of reusing plastic products, higher expenditures on compostable and paper packaging, and higher transaction costs of sorting waste. The household waste fees attributed to plastics are also higher in the IPR scenario than in the CP scenario, as they cover a portion of increased cost of collection, sorting, and landfilling. Nonetheless, they account for an insignificant portion of the total cost of plastic utility. For these reasons, the total household expenditures on plastic utility in the IPR scenario are higher than in 2020.

The temporary increased household expenditure on plastic utility per capita by 2030 could be more than compensated for vulnerable households by using fiscal savings and additional government tax revenue in the IPR scenario. After 2030, however, household plastic utility expenditures per capita and as a share of total household expenditure grow more slowly in the IPR scenario than in the CP scenario.

Potential social hardship of plastic waste management is additionally mitigated by the expectation that under both scenarios, the burden of plastic utility costs as a share of total household spending decreases, since total household expenditures are expected to grow faster than expenditures on plastic utility (figure 4.10).