Designing Economic Incentives for U- POPs Reduction in Thailand’s Scrap Metal Recycling Sector: A BAT/BEP- Oriented Policy Framework

Abstract This paper introduces a regulatory framework designed to mitigate U-POPs, specifically dioxins and furans, originating from Thailand's ferrous and non-ferrous scrap metal recycling sector. Considering the sector's intricate framework and considerable environmental repercussions, the research emphasizes the formulation of economic incentives that encourage the implementation of BAT and BEP, particularly among SMEs with constrained financial and technical capabilities.The study, conducted under the project “Greening the Scrap Metal Value Chain through Promotion of BAT/BEP to Reduce U-POPs Releases from Recycling Facilities – Phase II”, is financed by the Global Environment Facility (GEF Project ID: 9222) and utilizes a mixed-methods approach. This include literature reviews, worldwide case analyses, field surveys, and comprehensive stakeholder discussions with regulators, commercial enterprises, and financial institutions. The research yields three incentive models: (i) a voluntary multi-measure framework (Option A), (ii) a conditional reward scheme predicated on emission performance (Option B), and (iii) a differentiated strategy customized to business size and technological capability (Option C).Option C emerged as the most preferred, providing targeted subsidies, concessional loans, and complimentary eco-certification for SMEs, while allocating proportionately less advantages to larger enterprises. This guarantees fairness, administrative practicality, and enhanced alignment with companies' financial capabilities. The report advocates for institutional collaboration among the Ministry of Industry, Board of Investment, Revenue Department, and financial institutions to execute tax relief, import duty exemptions, and environmentally-oriented investment initiatives.Essential proposals encompass the expansion of green lending initiatives, the subsidization of U-POPs monitoring expenses, and the enhancement of laboratory infrastructure to facilitate regulatory adherence. The proposed framework harmonizes regulatory enforcement with supportive incentives and provides a scalable model for sustainable industrial change.This approach, aligned with the Stockholm Convention and Thailand’s Bio-Circular-Green Economy agenda, functions as a repeatable model for developing nations aiming to diminish U-POPs via integrated, incentive-driven environmental governance.