Borealis + Borouge: Partnership to establish an integrated circular economy system for plastic waste in Indonesia

Borouge and Borealis, together with Pelita Mekar Semesta (PMS), Reciki Solusi Indonesia, the Catalytic Finance Foundation, and the Subnational Climate Fund (SCF), have entered into a partnership to establish an integrated circular economy system for plastic waste in Indonesia. The goal is to develop an end-to-end waste management and polyolefin recycling system, which is the first of its kind to be implemented in the country.

The initiative begins with a feasibility study funded under the technical assistance program of the Subnational Climate Fund. Supported by the Catalytic Finance Foundation, the study will evaluate the establishment of a new plastic recycling plant in East Java. The entire process chain will be examined—from the sorting of mixed plastic waste with a high polyolefin content to processing and the production of recycled plastic granules.

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The focus is on developing an integrated system that makes plastic waste usable as a raw material source for high-quality recycled polyolefins. Established technologies and industrial processes will be utilized to ensure the quality of the recyclates for various applications. The project will be implemented in close cooperation with local waste management and recycling companies to integrate existing structures and build a resilient value-added network.

Managed by Pegasus Capital Advisors, the Subnational Climate Fund invests in sustainable infrastructure and agriculture projects in emerging markets. Technical support is provided through a dedicated facility managed by the International Union for Conservation of Nature (IUCN) and operated in cooperation with Gold Standard and the Catalytic Finance Foundation. The objective is to enable climate-positive and nature-friendly investments through a combination of technical assistance and financial instruments.

Pelita Mekar Semesta and Reciki Solusi Indonesia bring their experience in Indonesian waste management and plastic recycling to the project. Borouge and Borealis contribute their technological expertise in the processing and refinement of polyolefins. Furthermore, close coordination is planned with Project "Stop", an initiative founded by Borealis and Systemiq that works with local authorities in Indonesia to develop circular waste management systems, specifically to reduce plastic waste leakage into the oceans.

The feasibility study marks the beginning of the project's conceptual phase. Based on its results, decisions will be made regarding the investment, design, and implementation of an integrated circular economy model for plastic waste in Indonesia.

More information: www.borealisgroup.com, www.borouge.com

Borealis AG, Vienna, Austria + Borouge, Ruwais, United Arab Emirates

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