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Environmental Economics in Philippines Case Study

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Updated: Oct 28th, 2020

Solid Waste Management Problem in Manila

Municipal solid waste refers to sewage emissions within a municipality. The main municipal solid wastes include commercial refuse, dead animals, demolition debris, household garbage, and plant remains, among others (Acosta 11). Solid waste management has become challenging in the Philippines, as the current options are not effective. Specifically, in the city of Manila, the quantity of solid wastes, in the form of municipal, commercial, and residential service garbage, has grown over the years due to an influx of human population.

The predominant wastes include food, plastics, textile, and industrial effluents (Aquino et al.). Although the national and local governments have put in place legislation and strategies to counter this menace, their implementation has not been effective. For instance, the Ecological Solid Waste Management Act and the Republic Act (RA) 9003 have not been efficiently implemented due to economic and social setbacks.

These challenges include limited budget allocation and poor garbage disposal habits among a section of the Manila population (Barrows 20). At present, there are open dumpsites and landfills against the Clean Air Act, which dictates that open sites should be closed. The government has attempted to implement sustainable and effective solid waste management strategies. For instance, in the year 2016, Metro Manila’s expenditure on waste management was P4.9 billion (Lopez).

The problem of Solid Waste Management in Manila

Metro Manila has suffered a surge in communicable diseases, such as cholera, dysentery, typhoid, and other food-borne infections, due to an increase in the quantity of garbage in the city. At present, the city mayor has tried appealing to the Metro Manila Development Authority (MMDA) to facilitate effective solid waste disposal. In turn, the authority has accused the mayor of neglecting his duty of cleaning the mess (Jenny).

It seems there is a blame game between the government authorities, yet the menace of poor solid waste management is becoming a health hazard (Mercurio). Although apportioning blame on the city mayor and the MMDA is politically convenient, the reality is that there is no place available to dump the waste after the closure of the San Mateo landfill (Plaza). Moreover, bad weather has made the situation worse as some residents are currently damping their solid waste in river Pasig.

At present, the challenge of poor solid waste management within the city of Manila should be addressed to avoid serious disasters that would pose a health risk and increase government expenditure (Lozada). Specifically, there is a need to create an effective solid waste management strategy accompanied by proper budget allocation as a solution to the present and long-term impacts of poor waste disposal.

Location, Coverage, and Affected Parties

Manila City is the capital of the Philippines. The city consists of six districts. Metro Manila is managed by a mayor and city council members. It covers an area of 619.57 square kilometers (Watkins, 43). As of the year 2015 government census, Metro Manila had a population of 12,877,253 with a density of 20,785 per square kilometer (Mercurio). The solid waste management menace has affected almost 75% of the city population, especially those in the middle and low-income classes. Interestingly, this group produces the highest quantity of garbage. Over the years, the local authority and the national government have spent billions in attempts to establish a permanent solution to the solid waste management challenge (Thomsen et al. 2409).

The first constraint is the inability of the authorities to work together in creating effective and sustainable solid waste management strategies. Due to political differences, the mayor’s office and the Metro Manila Development Authority are not in agreement on the best approach in solid waste management strategies (Ranada, “Why PH is World’s 3rd Biggest Dumper”). The second constraint is the limited budget allocation for solid waste disposal, despite the ever-increasing population.

This challenge has made it difficult for the relevant authorities to execute any meaningful effort in solid waste management (Talabong). Moreover, there is limited space for the disposal of solid wastes within Metro Manila since most of the landfills and dumpsites have been closed. From a planning perspective, the growing mountain of garbage cannot be absorbed by the few available waste disposal mechanisms (Ranada, “Pia Cayetano to Look into Torre de Manila Violations”).

Lastly, the poor garbage disposal habit of the Metro Manila population is a contributory factor to failures in ineffective solid waste management. For instance, despite a series of efforts by the authority to promote garbage sorting before disposal, most households still mix plastic and biodegradable wastes in a single bin. At the same time, a section of the low-income population disposes their waste in river Pasig because of ignorance on the potential impacts of such action.

Economic Analysis of the Problem

In order to carry out cost-benefit analysis (CBA) of solid waste management with the Metro Manila city, discounted costs and benefits of each waste disposal option were considered (Van et al. 2182). Specifically, the Present Net Value (NPV) and Benefit-Cost Ratio (BCR) were applied to identify the potential costs and benefits associated with each option. The CBA considered composting and recycling alternatives to establish the most efficient and practical option. As captured in table 1, the available data from the Metro Manila Development Authority for the year 2016 indicate different benefits and costs for each option.

Table 1: Cost and benefits of each solid waste management options.

Benefits and Costs Current Solid Waste Management Alternatives
Recycling Composting
Monetary Value Monetary Value
Quantity purchased/kg 26,956.9
Buying price/kg 240
The total cost of buying plastic bottles 6,463,452.703
Water bills 391,875.8
Labor costs per station 470,107 113,456
Machine workers per station 566,521
Electricity bills 5,694
Packaging materials 12,960.44
Machine maintenance 171,456
Transport cost 1,399,675 16,000
Total costs 9116932 529,430.8
Quantity sold in Kilos 24,890
Quantity of the sold compost in Kilos 7,689.99
Selling price per Kilo 600 300
Summation of sales from compost and materials 15,511,895 1,617,345.6
Total benefits 15,560,906 1,617,645.6
Net Benefits 5,625,675 998,729.7
Net Present Value (NPV) 14,205,865.03 31,455,863.543

The NPV was calculated at a discounted rate of 12%. The results from table 1 suggested that all the solid waste management strategies in place had a positive NPV. This is an indication that costs associated with recycling and decomposition can be recovered by the local authority. At the same time, any investment in place using either of the options is likely to have a positive profit margin. Apparently, the local authority should consider expanding the current solid waste management strategies to cover every corner of the Metro Manila City. However, more attention should be directed to recycling since it can be done at household level and has the highest bundle of benefits.


The local authority should encourage source sorting, recycling, and composting at household level in a formal and structured manner to reduce the solid wastes marked for disposal. Based on the economic analysis, more resources should be channeled towards recycling as a strategy for solid waste management. Thus, the relevant authority should consider enacting strict regulations and policies to ensure that optimal return is achieved for every bundle of investment.

Works Cited

Acosta, Voltaire et al. “Development of the Philippines National Solid Waste Management Strategy 2012-2016.” Procedia Environmental Sciences, vol. 16, 2012, pp. 9-16.

Aquino, Albert et al. “Ecological Solid Waste Management Act: Environmental Protection: Through Proper Solid Waste Practice.” Agnet. Web.

Barrows, David. A History of the Philippines. Guttenburg Free Online E-books, 2014.

Jenny, Manongdo. “Culture Agency Moves to Restore ‘Manila, Paris of the East’ Image”. Manila Bulletin. 2016. Web.

Lopez, Virgil. . GMA News. 2017. Web.

Lozada, Bong. ““. Philippine Daily Inquirer. 2014. Web.

Mercurio, Richmond. . Philippine Star. 2017. Web.

Plaza, Aldrin. “Ditch NIMBY to Fix Philippine’s Municipal Solid Waste Problem”. Adb. Web.

Ranada, Pia. “Rappler. Web.

—. . Rappler. Web.

Talabong, Rambo. ““. Rappler. 2017. Web.

Thomsen, Nilosevic et al. “Application of a Contaminant Mass Balance Method at an Old Landfill to Assess the Impact on Water Resources.” Waste Management, vol. 32, no. 12, 2012, pp. 2406-2417.

Van, Leeuwen et al. “City Blueprints: 24 Indicators to Assess the Sustainability of the Urban Water Cycle.” Water Resources Management, vol. 26, 2012, pp. 2177-2197.

Watkins, Rodic. Systems Evaluation: Methods, Models, and Applications: A Guide to Assessing Needs: Essential Tools for Collecting Information, Making Decisions, and Achieving Development Results. CRC Press, 2012.

Wilson, Dickson et al. “Comparative Analysis of Solid Waste Management in 20 Cities.” Waste Management and Research, vol. 30, no. 3, 2012, pp. 237-254.

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IvyPanda. (2020) 'Environmental Economics in Philippines'. 28 October.

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