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A customer browses mobile phones in a retail store in the Sham Shui Po district of Hong Kong. Electronic waste has become an increasing problem in China, which is expected to have 6 billion discarded mobile phones by 2025. Photo: AFP

China to reach 6 billion discarded mobile phones by 2025, providing a largely untapped source of rare metals

  • Electronic waste in the world’s largest smartphone market is an increasing problem after mobile phone ownership reached 1.8 billion units in 2021
  • Smartphones contain many precious and rare earth metals that make them valuable targets for recycling drives, as Beijing seeks to reduce carbon emissions
Smartphones

China, the world’s largest smartphone market, will have more than 6 billion discarded handsets by 2025, according to a report from state-run media outlet China Central Television (CCTV), aiding a flourishing second-hand electronics industry amid Beijing’s efforts to combat climate change.

Mobile phone ownership in China has been rising in recent years, reaching a total of 1.8 billion units by the end of 2021, CCTV reported, citing figures from the China Association of Electronics Equipments For Technology Development (CAEETD). The number includes phones that are no longer in use.

As more Chinese consumers upgrade their devices to newer models each year, old handsets are piling up. Fewer than 2 per cent of smartphones are properly recycled in China, with the rest mostly either discarded through improper disposal or sitting idle at home, according to research from the environmental organisation Greenpeace East Asia.

How e-waste recycling extracts value from millions of old smartphones

Many of the materials in mobile phones can be reused, giving companies an incentive to get those devices back. These materials include precious metals such as gold, silver, copper, platinum, and palladium, along with a number of rare earth metals that are difficult to mine.

But the threshold for recycling discarded phones is relatively high, according to Tang Aijun, secretary general of the CAEETD. “It needs a large-scale, upfront investment with very high operating costs, but the profitability is pretty low,” Tang told local media.

In 2019, Asia was a distant second in collecting and recycling electronic waste, at a rate of 11.7 per cent, according to the Global E-waste Monitor 2020 report from the United Nations Institute for Training and Research. Europe was the global leader at 42.5 per cent.

The recycling rates for the Americas and Oceania were 9.4 per cent and 8.8 per cent, respectively. Africa had a rate of 0.9 per cent.

China’s latest five-year plan, which outlines goals for the country’s social and economic development through 2025, said that a circular economy is a major strategy for the country, and the construction of a waste recycling system is important for realising its “dual carbon” targets. The term refers to Beijing’s goal to have China reach peak carbon emissions by 2030 and carbon neutrality by 2060.

At this year’s “two sessions” – China’s largest annual political gathering where delegates are able to make suggestions to policymakers – multiple representatives made proposals regarding the recycling of computer, communications, and consumer electronics products.

Lei Jun, CEO of smartphone maker Xiaomi, proposed an individual carbon trading scheme that includes recycling discarded mobile phones.

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The rise of Chinese smartphones

The rise of Chinese smartphones
Dedicated second-hand electronics markets have also seen significant growth during the pandemic, which contributed to a chip supply crunch and a shortage of many related products. Sales of used laptops and tablet computers in lower-tier cities received a boost in 2020 while students were forced to study from home.

Last year, multiple trading platforms raised millions of dollars in capital as they sought to expand their businesses.

AiHuiShou International, a second-hand electronics marketplace backed by e-commerce giant JD.com, raised US$227 million in its initial public offering on the New York Stock Exchange last June.
Beijing Zhuanzhuan Spirit Technology, another major second-hand e-commerce platform, raised more than US$550 million last year, with Xiaomi and social media and video gaming giant Tencent Holdings among its major investors.
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