recycling Article How COVID-19 Could Change the Economics of the Plastic Recycling Sector Ibrahim Issifu 1, * , Eric Worlanyo Deffor 2 and Ussif Rashid Sumaila 1   Citation: Issifu, I.; Deffor, E.W.; Sumaila, U.R. How COVID-19 Could Change the Economics of the Plastic Recycling Sector. Recycling 2021, 6, 64. https://doi.org/10.3390/ recycling6040064 Academic Editors: Michele John and Wan-Ting (Grace) Chen Received: 4 February 2021 Accepted: 22 September 2021 Published: 26 September 2021 Publisher’s Note: MDPI stays neutral with regard to jurisdictional claims in published maps and institutional affil- iations. Copyright: © 2021 by the authors. Licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license (https:// creativecommons.org/licenses/by/ 4.0/). 1 Fisheries Economics Research Unit, Institute for the Oceans and Fisheries, University of British Columbia, Vancouver, BC V6T 1Z4, Canada; r.sumaila@oceans.ubc.ca 2 Ghana Institute of Management and Public Administration, Accra P.O. Box AH50, Ghana; ewdeffor@gimpa.edu.gh * Correspondence: i.issifu@oceans.ubc.ca Abstract: The price of oil has a great influence on prices of recycled plastics and, therefore, plastic recycling efforts. Here, we analyze the effects of the ongoing COVID-19 pandemic on crude oil price and how this, in turn, is likely to affect the degree of plastic recycling that takes place. Impulse response functions and variance decompositions, calculated from the structural vector autoregression, suggest that changes in crude oil prices are key drivers of the price of recycled plastics. The findings highlight that because plastics are made from the by-products of oil, falling oil prices increase the cost of recycling. Therefore, the price of recycled plastics should be supported using taxes while encouraging sustained behavioral changes among consumers and producers to selectively collect and recycle personal protective equipment so that they do not clog our landfills or end up in our water bodies as plastic waste. Keywords: plastic recycling; crude oil; impulse response functions 1. Introduction When the first cases of COVID-19 were identified in China in December 2019/January 2020, and the cases continued to expand across all parts of the world, few anticipated the speed and magnitude of the impact of this event on the global economy. In fact, no one could have imagined the extent to which this novel virus would shut down our schools, shops, airport, etc., or that the price of crude oil could drop to the negative dollar. Like most sectors, the plastic recycling sector would be significantly affected by this pandemic, but the nature and extent of how the sector would be affected are yet unknown. Here, we give a prospective outlook on how the disruption triggered by COVID-19 could act as a catalyst for short-term and medium-term changes in the plastic recycling industry worldwide. Plastics are the lifeblood of modern life. From the bags we carry our groceries in to soft drinks and water bottles and almost every electronic packaging in the supermarket, plastics have penetrated their way into every aspect of our society. Present-day plastics, such as low-density polyethylene, polystyrene, and polypropylene, are part of synthetic polymers, which are derived from oil or gas, and designed to be durable and undergo limited fragmentation [1]. Due to the low cost and versatile properties of these synthetic resins, the production of global plastics reached about 8.5 billion metric tons in 2015 [2]. Today, it is hard to imagine a world without plastics, even though the pervasiveness of plastic in our lives is a recent development. Along with lockdowns to slow the spread of the pandemic, the demand for plastics might be dropped, as other types of plastic consumptions, such as outdoor furniture replacements, could be largely decreased due to COVID-19. However, there is increasing concern over the surge in PPEs. For instance, in February this year, China increased the production of single-use face mask 12-folds per Recycling 2021, 6, 64. https://doi.org/10.3390/recycling6040064 https://www.mdpi.com/journal/recycling