Report: Circular Economy in Somali Region, Ethiopia

The report maps existing circular economy (CE) activities and key public and private actors in the sector in Ethiopia, particularly in Somali region of the country. It also examines Ethiopia’s policy and legal frameworks supporting CE and the status of the National Circular Economy Roadmap of Ethiopia. Finally, it assesses opportunities and challenges of implementing CE activities.

The most enterprises engaged in the circular economy focus on recycling activities, particularly in plastics, paper, and composting of organic waste. The recycling processes include collection, sorting, grading, and processing of wastes into raw materials or finished products, such as PET plastic, paper products, fertilizers, and textiles. Additionally, there are enterprises involved in re-use and regeneration, especially in textile waste recycling, where mechanical shredding and fiber separation create new materials and garments.

Key initiatives supporting the circular economy directly or indirectly in the Somali Region include the Green Legacy program, which enhances resource regeneration; community empowerment and climate adaptability programs fostering local capacity for sustainable practices; the Climate Change Adaptation Development Initiative at the Bureau level, integrating resilience into development activities; and the Environmental Pollution Control Mechanism at the regional level, which regulates waste and pollution.

The report recommends prioritisation of integrated strategies and strong partnerships among government agencies, private actors, civil society, and local communities for effective implementation. Investments should focus on enhancing waste management infrastructure, improving regulatory enforcement, promoting advanced recycling technologies, and raising public awareness to encourage waste segregation and circular practices. Targeted interventions are needed to empower women and youth entrepreneurs in CE sectors. In the Somali Region, specific CE interventions such as livestock-based biogas, composting and plastic initiatives can generate income, improve rural energy access, and strengthen regional resilience to climate and environmental shocks. Integrating informal sector actors into formal systems will improve working conditions and sector efficiency.

In more concrete terms, the report discusses the challenges, opportunities and lessons learned in the sector through six business examples:

• Shikur, Tebarek, and Friends that buys plastic, paper waste, and cardboard collected by waste collector MSMEs, categorizes them manually according to industrial demand, and resells them to industries such as Tatek and Rahel semi-finished plastic producers and Kuriftu Pulp Manufacturing.
• Tatek, Rahel and friends that buys separated plastic waste from suppliers, categorizing and grading them manually, washing, crushing, and melting them into semi-processed products. These are then supplied to manufacturers producing polyester and nylon fibers, brooms, and ropes.
• Gashawu Tsehay and Friends Composting Enterprise that produces organic fertilizer. The enterprise was formulated by the Woreda MSME office, which facilitated a startup loan, provided working space, and has been monitoring its progress since its establishment.
• Biruk Selamawit and Friends JITU Organic Fertilizer and Composting, core operation involves collecting biodegradable waste, sorting it into carbon- and nitrogen-based materials, and undertaking controlled microbial composting to produce high-quality organic fertilizer.
• Kubick Inc is a pioneering company that focuses on recycling plastic waste to produce affordable and durable building materials, positioning itself as an innovative solution addressing two major challenges in Ethiopia: plastic pollution and the housing deficit.
• Haji Plastic Recycling Enterprise in Jijiga recycles plastic waste such as bags, bottles, and barrels to produce PP (polypropylene), which is then transported to Addis Ababa where demand is high.

Key finding from the case studies is that successful enterprises rely heavily on government facilitation of loans and provision of land and working spaces; international donor support and technical training; and robust market linkages to industries ensuring consistent demand. Despite proven growth and profitability, challenges such as high transportation costs, inadequate storage facilities, and limited access to customized financial products constrain their full potential. The abundant availability of waste inputs and rising market demand indicate that scaling these models is feasible, but requires enhanced policy incentives, improved financial inclusion, infrastructure development, and supportive regulatory frameworks. Ultimately, circular economy initiatives thrive when multi-stakeholder partnerships, enabling policies, and targeted financing mechanisms are in place, confirming their viability, social impact, and environmental benefits.

The case study of Haji Plastic Recycling Enterprise in Somali region also demonstrates that although there is high potential for plastic recycling in regions like Jigjiga due to abundant waste resources and minimal competition, the absence of local industries to utilize recycled products, coupled with immediate cash flow needs and limited financial support, severely constrains operational capacity and growth. This highlights the importance of developing integrated local value chains, providing accessible financing mechanisms for working capital, and ensuring infrastructure and environmental compliance support to enable recycling enterprises to operate sustainably and maximize their social and environmental impact.