Asia is home to some of the world’s fastest-growing economies—and, increasingly, some of its fastest-growing waste streams. In 2025, with plastic consumption rising and environmental pressure mounting, recycling is no longer a side effort in the region. It’s center stage.

Asia’s recycling systems remain uneven despite increased investments in recent years. Rapid progress is found in some countries such as Thailand and South Korea, while deep-rooted inefficiencies continue to plague other countries, such as Indonesia and Cambodia. According to recent industry estimates, the Asia-Pacific recycled plastics market is expected to grow exponentially, with increasing demand for sustainable packaging, textiles and other consumer goods. However, the gap between recyclable material and actual recycling remains wide.

A big part of the problem? Collection and sorting. “With no regulations or proper enforcement for waste collection, Asia Pacific will suffer,” said one Southeast Asia-based recycler.

Although major brands across Asia pledge to use more recycled content, supply continues to remain unreliable, especially high-grade, food-safe flakes or resin.

In many parts of Asia, recycling still relies heavily on informal networks. Small-scale collectors and processors are recognized as the backbone of waste management, especially in countries like India, Indonesia and Vietnam. While these networks assist in ensuring that recyclable materials are kept out of landfills, they also encounter challenges such as inconsistent quality of feedstock and lack of traceability and transparency. Unsafe working conditions also continuously limit how much waste can be recycled into higher-value end applications.

China, once the world’s top importer of plastic waste, is shifting its focus towards domestic circularity. State-backed efforts are underway to create large-scale recycling hubs and boost recovery of materials like plastics, metals and textiles. India is also aggressively pushing ahead with extended producer responsibility (EPR) mandates nationwide. Producers are now legally responsible for recovering a set percentage of the plastic they put into the market — a move that’s forcing companies to rethink everything from packaging design to logistics.

However, execution remains patchy. Several recyclers based in the Indian subcontinent report that the plastics they receive under EPR programs are often contaminated or poorly sorted, making it hard to meet quality specs. Additionally, they often struggle with obtaining flakes or bales with consistent quality, increasing the difficulty of ensuring the quality of end products.

Chemical recycling, or advanced recycling, is defined as chemical processes that break down plastic waste that is difficult to recycle mechanically at the molecular level to create recycled plastics with virgin-like properties. This alternative form of recycling is gaining momentum and attention across Asia. Methanolysis, pyrolysis, and depolymerization technologies are beginning to scale, with projects underway in more developed countries such as Japan, South Korea and Singapore. These methods promise to turn hard-to-recycle waste—like multilayer food packaging or polyester textiles—into high-value feedstocks. However, they’re still capital-intensive, and feedstock supply chains remain a sticking point.

Asia’s recycling economy in 2025 is a mix of momentum and friction. While governments are tightening regulations, brands are reducing their commitment to circularity. Recent developments in U.S.-China trade relations have added another layer of complexity to Asia’s recycling economy.

U.S. tariffs have also added a heavy knock-on effect on global shipping costs, resulting in higher freight costs globally. Coupled with delicate trade routes, this added further pressure to Asia’s recycling industry. Shipping routes have become more volatile, with freight companies adjusting pricing to account for uncertain demand and rerouted cargo flows. Container shortages, combined with the rush to move goods during tariff reprieves, have led to price spikes on key trans-Pacific routes.

For recyclers and exporters of recycled PET (rPET) based in Asia, these elevated logistics costs have eroded already thin margins, making it harder to compete with low-cost virgin plastics that are more easily available. Coupled with the absence of mandatory regulations that enforce the use of recycled plastics, this results in rPET being less desirable in comparison to its virgin counterpart.

As Asia pushes forward on its path towards circularity, the region continues to face a delicate balancing act by trying to scale innovation while navigating policy shifts, trade turbulence and infrastructure gaps. While the potential for recycled plastics remains strong, progress will require coordination and collaboration across the value chain, well supported by government regulations.