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

Designing Economic Incentives for U- POPs Reduction in Thailand’s Scrap Metal Recycling Sector: A BAT/BEP- Oriented Policy Framework | Research Square window.SnipcartSettings = { analytics: { enabled: false } }; (function() { var accessVector = localStorage.getItem('access_vector') || ''; window.dataLayer = window.dataLayer || []; if (accessVector) { window.dataLayer.push({ user: { profile: { profileInfo: { snid: accessVector } } } }); } })(); (function(w,d,s,l,i){w[l]=w[l]||[];w[l].push({'gtm.start':new Date().getTime(),event:'gtm.js'});var f=d.getElementsByTagName(s)[0],j=d.createElement(s),dl=l!='dataLayer'?'&l='+l:'';j.async=true;j.src='https://www.googletagmanager.com/gtm.js?id='+i+dl;f.parentNode.insertBefore(j,f);})(window,document,'script','dataLayer','GTM-K279D39R'); Browse Preprints In Review Journals COVID-19 Preprints AJE Video Bytes Research Tools Research Promotion AJE Professional Editing AJE Rubriq About Preprint Platform In Review Editorial Policies Our Team Advisory Board Help Center Sign In Submit a Preprint Cite Share Download PDF Research Article Designing Economic Incentives for U- POPs Reduction in Thailand’s Scrap Metal Recycling Sector: A BAT/BEP- Oriented Policy Framework Niramon Sutummakid, Ronbanchob Apiratikul, Darika Phothiruk, Pijitra Jomsri, and 2 more This is a preprint; it has not been peer reviewed by a journal. https://doi.org/ 10.21203/rs.3.rs-6718493/v1 This work is licensed under a CC BY 4.0 License Status: Posted Version 1 posted You are reading this latest preprint version 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. Unintentional Persistent Organic Pollutants (U-POPs) Economic Incentives Scrap Metal Recycling Best Available Techniques (BAT) Best Environmental Practice (BEP) Environmental Policy Framework Figures Figure 1 Figure 2 Figure 3 Figure 4 Figure 5 1. Introduction The scrap metal recycling industry is vital to Thailand's industrial advancement, resource optimization, and ecological sustainability. This sector has considerable environmental challenges, notably the inadvertent emission of unintended persistent organic pollutants (U-POPs), including polychlorinated dibenzo-p-dioxins and polychlorinated dibenzofurans (PCDD/PCDF) (Nie et al., 2012 ; Shen et al., 2021 ; Tysklind et al., 1989 ). These extremely hazardous chemicals are produced as by-products in high-temperature industrial operations, such as metal smelting, refining, and waste incineration (Abballe et al., 2013 ; Hung et al., 2015 ; Zou et al., 2012 ). U-POPs provide significant hazards to human health and the environment owing to their persistence, bioaccumulation, and capacity for long-range environmental movement (Ajay et al., 2022 ; Marinkovic et al., 2010 ; Szajner et al., 2021 ). As a signatory to the Stockholm Convention on Persistent Organic Pollutants, Thailand is legally and morally obligated to mitigate and, where possible, eradicate emissions of U-POPs from anthropogenic sources, including metal recycling factories. Mitigating U-POPs emissions in the metal recycling sector is a complicated endeavor that necessitates a comprehensive strategy integrating regulatory enforcement, technological advancement, institutional collaboration, and economic incentives. Economic incentives serve as a potentially formidable yet underexploited tool for encouraging environmentally responsible behavior and advancing the use of sophisticated pollution control systems (Kolstad, 1986 ). Economic incentives can alter market dynamics and internalize environmental externalities, thereby promoting sustainable behaviors within the private sector (Tietenberg, 1990 ). They can alleviate the financial strain of environmental compliance and investment in cleaner technology, particularly for small and medium-sized enterprises (SMEs) that encounter disproportionate expenses and obstacles in upgrading their equipment and operations. The Thai Ministry of Industry (MI) launched a comprehensive initiative named “Greening the Scrap Metal Value Chain through Promotion of Best Available Technique/Best Environmental Practice (BAT/BEP) to Reduce U-POPs Releases from Recycling Facilities – Phase II ( https://www.thegef.org/projects-operations/projects/9222 )” in acknowledgment of these dynamics. This study seeks to develop and propose practical, inclusive, and scalable economic incentives tailored to the needs and constraints of industry stakeholders, building on the foundation established in Phase I (2019–2021), which concentrated on identifying BAT/BEP pertinent to the sector. These incentives aim to function as policy instruments to encourage private enterprises to voluntarily implement cleaner technology and practices, thereby attaining the dual objectives of environmental preservation and economic competitiveness. The justification for implementing economic incentives is based on their adaptability, cost-efficiency, and capacity to cater to various business scales and technology capabilities. In contrast to command-and-control laws that enforce similar standards across industries irrespective of their financial or operational circumstances, economic incentives enable enterprises to select the most efficient route to compliance. Additionally, incentives like tax credits, low-interest loans, grants, and eco-labeling initiatives can encourage sustained investment in pollution control systems, mitigate operational risks, and enhance capital accessibility (Le et al., 2024 ; Panayotou, 1998 ; Paramasua et al., 2023 ). When connected with environmental performance benchmarks, such as legally enforced U-POPs emission requirements, these incentives can stimulate comprehensive systemic change and foster innovation. The study team utilized a mixed-methods approach, incorporating literature studies, stakeholder engagements, field surveys, and in-depth interviews to formulate effective policy suggestions. International experiences were examined to derive insights on the efficacy and viability of diverse incentive programs, especially in developing nations with analogous industrial characteristics. The existing domestic instruments, including the BOI’s tax incentives, the Environmental Fund’s concessional loans, and SME Bank’s green financing initiatives, were evaluated to pinpoint opportunities for incorporating U-POPs reduction goals. Original survey data from stakeholders across several sub-sectors of the scrap metal value chain, including collectors, foundries, downstream businesses, regulators, and financial institutions, reinforced these findings. Consultation findings indicate that although awareness of U-POPs and the advantages of BAT/BEP is increasing, economic factors continue to pose a significant obstacle to widespread implementation. The majority of operators demonstrated robust endorsement for fiscal incentives (e.g., tax exemptions on BAT/BEP-related investments), financial incentives (e.g., concessional loans and credit guarantees), and targeted subsidies, especially for capital-intensive enhancements such as exhaust gas treatment systems and automation technologies. Minor operators emphasized the necessity for streamlined access to funding methods, decreased bureaucracy, and capacity-building assistance. A group of stakeholders highlighted the prospective influence of eco-labels and green procurement in stimulating consumer demand for ecologically sustainable metal products. The study presents a three-tiered framework for economic incentives, classified into ( i ) fiscal incentives, comprising tax reductions, corporate income tax exemptions, and import duty waivers; ( ii ) financial incentives, encompassing soft loans, credit enhancements, and loan interest subsidies; and ( iii ) consumer incentives, featuring eco-label certification, green procurement promotion, and public information campaigns. This study enhances the debate on sustainable industrial policy and environmental governance in Southeast Asia by proposing a practical, evidence-based framework for economic incentives. It offers a framework for Thailand and other developing nations aiming to meet their obligations under the Stockholm Convention while promoting industrial innovation and inclusive economic development. The study emphasizes that environmental conservation and economic development can coexist; with appropriate incentives, the private sector can play a crucial role in the transition to a cleaner, healthier, and more sustainable future. 2. Research Methods This study utilized a thorough mixed-methods approach to create, assess, and enhance economic incentive mechanisms intended to mitigate U-POPs in Thailand's scrap metal recycling industry. The research technique incorporated literature reviews, stakeholder involvement, and empirical data gathering, in accordance with national environmental policy objectives and the provisions of the Stockholm Convention (see Fig. 1 ). The initial phase comprised a comprehensive examination of both domestic and international literature regarding economic instruments for the management of U-POPs, emphasizing the relevance of subsidies, tax incentives, low-interest loans, and eco-labeling initiatives to encourage BAT/BEP. Comparative policy evaluations of case studies from Vietnam, Pakistan, and China were performed to evaluate the efficacy of incentives in analogous industries. This phase expanded on the findings from Phase I (2019–2021), which involved comprehensive interviews with 27 stakeholders, by conducting updated surveys and interviews across five categories: collectors, foundries, downstream companies, sellers, and regulators. These interactions disclosed industry predilections, demonstrating a pronounced preference for tax-oriented incentives and financial assistance frameworks. Empirical data from structured surveys was analyzed to evaluate corporate expectations for BAT/BEP adoption, including expected advantages (e.g., cost reduction, environmental enhancement) and preferred types of governmental support. Results underscored the necessity for customized incentives contingent upon organizational size and capability to adhere to emission regulations. Subsequent to the development of the proposed economic instruments, multi-sectoral consultation meetings were convened in July and August 2023, utilizing both in-person and virtual formats. Participants comprised governmental entities, financial institutions, non-governmental organizations, and private sector stakeholders. Feedback was consolidated to enhance the incentive structures, assuring feasibility, fairness, and compliance with current regulatory frameworks. The concluding methodological phase entailed confirming the incentive system via further meetings with regulatory authorities and integrating stakeholder recommendations. This procedure confirmed the viability of incorporating the proposed incentives into Thailand's industrial policy and environmental rules. 3. Harnessing Economic Incentives for U-POPs Reduction: A Strategic Review of Policy Instruments to Promote BAT/BEP Adoption in Thailand and Beyond Empirical research from the European Union (EU) and other developing nations indicates that well-designed market-based mechanisms can substantially aid in the reduction of U-POPs (see Table 1 ). Emission taxes and product levies have been efficiently implemented for items such as pesticides, fertilizers, and chlorinated solvents. For instance, financial incentives within the EU have facilitated the use of certified stoves, flue gas purification systems, and high-temperature incineration to control U-POP emissions. These interventions, although elevating the expense of specific items, have facilitated the embrace of more sustainable practices, as seen by the increased costs of conventional pesticides and a heightened adoption of organic agricultural techniques. Table 1 Market-based instruments and examples of applications in chemical management (Slunge and Alpizar, 2019 ) Policy Instruments Description Example of Application Substance Tax By increasing the price of using a chemical, a tax incentivizes decreased use. Taxes are levied by the state, with proceeds going to the general budget. The level should reflect the damages caused by the production, use and disposal of the chemical, which in the absence of the tax would not be reflected in the market price of the input or final product. Pesticides, inorganic fertilizers, chlorinated solvents Waste Charge / Fee A form of tax but revenues are typically earmarked. The level of a fee should reflect the cost of providing a specific service, such as processing hazardous waste. Hazardous waste, pesticide or chemical containers, tires, batteries Subsidy A subsidy is the mirror image of a tax. It can provide incentives to increase the use of alternative chemicals that are less hazardous. Authorities may want to subsidize learning and technology development. Subsidies for organic farming, lead paint removal Subsidy Removal In many cases, subsidies are introduced to deal with distributional concerns, yet may result in unsound practices from a health or environmental perspective. Hence, subsidy removal is considered a policy instrument in its own right. Removal of subsidies for the use of chemical fertilizers or pesticides Deposit Refund A surcharge is paid when purchasing potentially polluting products. A refund is received when returning the product to an approved center for recycling or disposal Pesticide or chemical containers, batteries and tires Tradable Emission Permit An overall level of ‘allowable’ pollution is established and allocated among firms in the form of permits. These permits can be traded on a market at market prices Lead in petrol (trade among refineries), ozone-depleting substances (trade among producers and importers) The analysis incorporates comparative case studies from Vietnam, Pakistan, and China to exemplify national strategies for U-POPs reduction in the ferrous and non-ferrous metal industries. Vietnam and Pakistan highlighted technical support frameworks, environmental impact evaluations, and comprehensive pollution prevention initiatives (see Table 2 ) (Ali, 2023; Mohapatra et al., 2023 ). In China, economic incentives were implemented to advance BAT/BEP in medical waste incinerator facilities, leading to a substantial decrease in dioxin emissions. Participating firms received financial assistance of RMB 1 million per facility, which accounted for about 67% of the investment cost for flue gas purification systems (Ren et al., 2016 ). These programs were directed by the concepts of voluntariness, transparency, and performance-based disbursement, demonstrating a scalable model for other nations. Table 2 Action plans for U-POPs reduction in industrial sectors of Vietnam and Pakistan Country Action plans for U-POPs reduction in the ferrous and non-ferrous sectors Sources Vietnam (1) Detailed assessment of the individual industries of BEP options, U-POPs reduction, including needs and options for BAT. (2) Introduce and effectively implement Guidelines on BAT/ BEP to release the sources of U-POPs (existing and new industry). (3) Removing the barrier to the introduction of technology that minimizes U-POPs through the introduction of management practices. (4) Promote technical institutions to support the implementation of cleaner production and BAT/BEP technologies. (5) Apply the concept of environmental impact assessment for key industrial sources. (6) Assessing synergies for the reduction of unintentional POPs, GHG, mercury and other priority pollutants and where possible address these pollutants together. Mohapatra et al., 2023 Pakistan (1) Assessment of the individual industries of BEP options, U-POPs reduction, and needs, options for BAT, including Environmental Impact Assessment (EIA). (2) Assessing synergies for the reduction of U-POPs, mercury, PM, GHG and other relevant pollutants and where feasible address pollutants in an integrated manner. (3) Introduce and effectively implement BEP and where required/possible BAT, U-POPs reduction measures (best within integrated pollution prevention and control). (4) Develop/promote institutions with the technical capacity to support the implementation of cleaner production (BEP), BAT for IPPC. Ali, 2023 Thailand has implemented a combination of fiscal, financial, and institutional incentives to encourage the adoption of BAT/BEP. The Board of Investment (BOI) provides tax advantages under the Seven-Year Investment Promotion Strategy (2015–2021), focusing on sectors including steel, chemicals, recycling, and energy (Fan and Wu, 2017 ). Projects that satisfy BOI's environmental and technical standards are eligible for corporate tax deductions, reductions in import duties, and non-fiscal advantages including land ownership rights and permits for foreign specialists. Moreover, enhancements in energy efficiency and environmental performance are incentivized by supplementary rewards, such as three-year tax exemptions and waivers on machinery import duties. In addition to BOI's economic incentives, the Environmental Fund—created under the 1992 National Environmental Quality Promotion and Protection Act—offers grants and concessional loans to both commercial and public sector entities. Funding facilitates the development and enhancement of wastewater treatment and air pollution control systems, in addition to the implementation of clean technology. Private enterprises qualify for low-interest loans (2–3% annually) with a repayment grace period of up to two years and a maximum duration of seven years, thereby promoting long-term investments in pollution control infrastructure. Additionally, Thailand’s SME Bank provides financial assistance to small and medium-sized firms (SMEs) who are adopting environmentally friendly business models in accordance with the national Bio-Circular-Green (BCG) Economy policy. Qualified projects centered on energy saving and renewable energy may obtain loans of up to 50 million baht for a duration of 10 years, with competitive interest rates commencing at 4.5%. This effort corresponds with a comprehensive governmental policy to integrate environmental factors into economic development. Literature highlights the essential importance of availability to BAT/BEP technology in meeting national objectives for U-POPs reduction. Although non-economic incentives—such as legal frameworks, environmental evaluations, and technical support—are significant, the involvement of the private sector is predominantly contingent upon explicit financial incentives. Compliance with legislative criteria alone does not guarantee proactive environmental performance; thus, economic incentives are crucial for promoting the voluntary adoption of cleaner technologies. The review suggests many economic policy alternatives suited to Thailand's industrial environment. These encompass: ( i ) subsidies for installation and operational expenses related to BAT/BEP, potentially sourced from national budgets or environmental funds; ( ii ) U-POP emission taxes that represent the social cost of pollution and incentivize industries to reduce emissions; and ( iii ) product levies on items with possible U-POP emissions throughout their lifecycle, with proceeds allocated to pollution mitigation efforts. Furthermore, fiscal incentives, like tax reliefs for low-income enterprises engaging in cleaner technology, as well as financial incentives through soft loans, increased credit limits, or grace periods, are advised to reduce compliance costs and promote private sector change. Ultimately, the implementation of eco-labels can significantly impact customer behavior and improve company reputation. Products or services that adhere to particular environmental standards may obtain certification from third-party organizations, indicating conformity with BAT/BEP criteria. Eco-labels promote sustainable consumption and function as non-tariff measures, providing competitive advantages over environmentally detrimental imported products. In summary, a combination of regulatory enforcement, financial incentives, and market-based instruments is crucial for advancing the lowering of U-POPs in Thailand. The successful execution of policy will rely on institutional capability, industry preparedness, and the creation of specialized financing structures to facilitate long-term environmental objectives. 4. Strategic Economic Incentives for the Reduction of U-POPs in Thailand’s Metal Recycling Industry This policy framework presents an integrated set of economic instruments aimed at reducing U-POPs from the ferrous and non-ferrous metal recycling industry in Thailand. U-POPs—particularly dioxins and furans—pose a critical environmental and public health risk, especially in developing countries undergoing rapid industrialization (Minh et al., 2003 ; Nguyen et al., 2003 ; Tue et al., 2013 ). In recognition of this challenge, the MI is advised to employ a multi-tiered incentive strategy that combines fiscal, financial, and consumer-based mechanisms. These measures are structured to promote the adoption of BAT/BEP in both small- and large-scale recycling operations. Given the sector’s heterogeneity, economic incentives must address the varying capacities of stakeholders, including scrap collectors, foundries, downstream industries, and end-users. Survey and interview data indicate that firms face considerable financial barriers in adopting BAT/BEP technologies, especially those related to exhaust gas treatment and automated control systems. Despite these costs, many enterprises recognize the benefits of implementation, which include reduced emissions, enhanced corporate reputation, and potential cost savings in the long term. 4.1. Overview of Economic Incentives A range of incentive mechanisms are proposed, including corporate tax deductions for environmental investments, import tariff reductions on BAT/BEP-related machinery, low-interest loans, direct subsidies, eco-labeling programs, and green procurement initiatives. A dedicated BAT/BEP Fund is also recommended to facilitate co-financing of capital and operational expenditures associated with U-POPs mitigation. The fund could be housed under existing financial mechanisms such as the Environmental Fund or the Energy Conservation Fund, with administrative oversight by the MI and associated regulatory bodies. Verified emission reductions—based on certified testing—would serve as the basis for accessing these benefits. 4.2. Detailed Analysis of Policy Options The framework outlines three implementation options—Option A, Option B, and Option C—each reflecting different approaches to incentive allocation, stakeholder targeting, and administrative feasibility (see Table 3 ). These options are designed to guide the MI in structuring a coherent, scalable, and results-oriented policy architecture. Table 3 Comparison of the three proposed options for economic incentives Topic Proposals on Economic Incentives Proposal 1 Proposal 2 Proposal 3 Incentive Details Incentive measures are specified in many cases, allowing entrepreneurs to choose from various measures according to their preferences (entrepreneurs can choose more than one measure). Incentive measures are categorized based on the conditions for releasing U-POPs, divided into three groups: those that still release substances above the limit, those releasing substances equal to or below the limit, and the scrap metal collection business group, with emphasis placed on the origin of U-POPs. Incentives are provided for each specific group of entrepreneurs, designed to promote financial fairness and facilitate access to BEP/BAT, to reduce emissions simultaneously. Entrepreneur Entrepreneurs have the freedom to apply for: - Fiscal measures (taxes) - Financial measures (low-interest loans) - Requesting subsidies - Certification/Green Procurement These entrepreneurs are divided into three groups: - General entrepreneurs - Entrepreneurs meeting the criteria for release standards - Metal sorters Advantages (Pros) Each entrepreneur can opt the incentive measures to receive support, with the responsible government agency screening the projects the entrepreneur proposes. Provide strong incentives for entrepreneurs who are still unable to reduce their emissions due to financial constraints. (a) This approach relies on the principles of shared responsibility that vary among entrepreneurs of different sizes and types of businesses. (b) The government sector can assess the budget situation and provide support guidelines for various entrepreneurs. (c) Evaluation of performance or follow up measures. Disadvantages (Cons) (a) The government sector is facing challenges in evaluating budgets and establishing support guidelines for various entrepreneurs. (b) Difficulty arises in determining clear guidelines for fair distribution of support among different types of businesses, including determining the appropriate level of assistance for each group. Conditions for entrepreneurs vary based on their individual businesses, with different types of end-users and downstream industries. Consequently, these measures prove ineffective in achieving the goal of substance reduction, as operators may be willing to pay fines if the release of substances exceeds the standard value. Transaction costs also increase when coordinating with intensive operators for proper evaluation. Table 4 Concise issues on incentive measures from additional consultation Agency meeting Concise issues from the meeting Department of Industrial Works (October 26, 2023) -Implementing measures to promote entrepreneurs is a positive incentive, ensuring that entrepreneurs are well-informed about the available promotion and assistance. -Requesting improvements to the criteria of GI3 or GI4 to include conditions related to the reduction of dioxins/furans for factory groups numbered 59 and 60. The Department of Primary Industries and Mines is required to send a letter to the GI Office, incorporating this request into the agenda for considering criteria when applying for GI. - Suggesting the classification of S-M-L factories into two groups: (1) S-M and (2) L. The current division based on horsepower may not accurately reflect actual emissions. In the future, if there is production rate information or fuel consumption available to support group division based on pollution levels, it can lead to improvements. Note: "Factory grouping can be enhanced in the future according to production quantity information or apparent fuel consumption (when this information is available). Board of Investment or BOI (October 27, 2023) -Factories, such as smelters, foundries, and metal facilities (manufacture of steels and irons), are eligible for investment promotion as listed in the Board of Investment (BOI) Announcement No. 9/2022, which outlines Measures to Promote Investment in Industries that are crucial to the Country's Development. The Criteria, rights and benefits for promoted projects are governed by the policies set out in the Board of Investment Announcement No. 8/2565 regarding policies and criteria for Investment Promotion. -Project applicants must meet the qualifications outlined in the Investment Promotion Board Announcements No. 8/2022 and No. 15/2022, released on December 8, 2022, regarding Enhancement Measure for Smart and Sustainable Industry. -Dioxin standards should be established when applying for promotion. If not, other parameters may need to be referenced to successfully mitigate environmental impacts. -Brief steps to request promotion: ●Apply according to the BOI form to request promotion. ●Provide information in the form, such as details about existing machinery, new machinery, environmental technology, and pollution reduction. ●Submit a promotion request before making any purchases or proceeding with production improvements (apply and inform the machine specifications before purchasing). ●Promotion eligible consideration is on a case-by-case basis, under committee approval. In assessing the potential of machinery to reduce pollution, the BOI will make its considerations (DPIM can screen a potentially approving technology for production improvement or pollution control to minimize environmental impact). ●BOI will inspect pollution reduction as requested for promotion after the machine installation (evaluating the extent to which pollution can be reduced). ●Requests for investment promotion entitlement from BOI require facilities to enhance technologies, and the results must meet environmental standards or exceed the specified standards for success. ●BAT (Best Available Techniques) may be in the line on request promotion from BOI, but BEP (Best Environmental Practices) may not, depending on evaluation to determine eligibility for promotion. -For a metal scrap sorting factory, investment promotion rights can be applied for, with the condition of an investment of 200 million baht onwards. -Currently, the BOI is considering promoting scrap metal businesses for recycling (in the process of consideration yet to result). -Consideration for promotion is divided into four levels: (1) Not exceeding 40 million baht accepted by BOI officers. (2) 40–200 million baht accepted by the BOI working group. (3) 200–2,000 million baht accepted by Sub-committee (agency representative) considers. (4) More than 2,000 million baht accepted by the Prime Minister of Thailand presides over consideration. -The BOI promotes investment in machinery and software to improve production but excludes dioxin monitoring cost. -The benefits that entrepreneurs will receive align with the BOI announcement. -DPIM may need to be coordinated with the BOI on detailed information and discussions. -In summary, the promotion request involves submitting a proposal to the BOI, which will consequently consider whether it can be provided as proposed, as well as any conditions or adjustments (DPIM Operation). Revenue Department (November 3, 2023) -If the metal recycling facilities are eligible for BOI promotion, apply for promotion according to the BOI guidelines to access various benefits. If the factory falls outside the BOI promotion criteria, it will be covered by tax privileges from the Revenue Department. -Granting tax deduction rights by the Revenue Department is generally open to everyone. It should apply to all factories measuring dioxins or improving machinery to reduce dioxins. Specific privileges, such as those for the group conducting dioxin measurement or enhancing environmentally friendly machinery for dioxin reduction within smelting, casting, and scrap metal factories (No. 59, 60, 106), should not be exclusively granted. -Principles for requesting a tax deduction must include reasons for the request, ensuring fairness and non-discrimination across all industry groups. The policy should not impose a significant fiscal burden. An example of general promotion rights includes those for clean energy groups or reducing carbon dioxide production, without specifying a particular sector. Requests for tax deductions for a limited number of factories must be justified reasonably. -Based on the calculation, the tax loss resulting from the cost of dioxin measurement is approximately 12,960,000 baht. This is derived by multiplying the number of factories (648) by the estimated measurement cost per year (100,000 baht), resulting in 64,000,000 baht, and then applying the corporate tax rate of 20%, resulting in the tax loss figure. It is recommended that assistance to entrepreneurs might be more appropriate in the form of assistance funds or subsidies. -A study case that can compare to project is the announcement of the Director-General of the Revenue Department regarding income tax (No. 425) dated June 27, 2022, regarding the determination of types, criteria, methods, and conditions for exemption of corporate income tax for corporations paying for the purchase of biodegradable plastic products. -When requesting a reduction in dioxin measurement fees, the analytical laboratory must be certified by a government agency. Payments must be made to a private entity or certified agency for the specified purpose. The request for expense reductions should cover all industries with the same measurement, being a general benefit rather than specific. -In the case of BAT/BEP expenses, there must be proof or certification that such expenses can effectively reduce pollution. -Considering the privilege to deduct dioxin measurement expenses as a tax deduction must be carried out at the Cabinet level. It must align with state policy, proposed by the Ministry of Finance, adhering to principles of fairness, non-discrimination, value, and maintaining fiscal discipline. - The process for requesting tax deductions for dioxin measurement expenses or BAT/BEP-related expenses involves writing a letter to the Director-General of the Revenue Department. Department-level discussions, including a comprehensive analysis of necessary information such as market analysis, beneficiary classification, use of benefits, calculation of the number of benefits, cost-benefit analysis, tax assessment, KPI indicators, monitoring and evaluation, etc., should be conducted. If it is an important policy, the Minister of Industry must submit a letter to the Minister of Finance, initiating the process through the Permanent Secretary of the Ministry, and it is the duty of the Minister to present to the Cabinet for consideration and approval. Customs Department (November 6, 2023) - The policy of import duty exemption/reduction on machinery, primarily applies to machines used in the production process to lower production cost, thereby increasing revenue for the Revenue Department. -An example list of machinery presented to the Customs Department, upon initial review, indicates that many items are already on the list of import duty-exempted or import duty-reduced items, such as those in item groups 84.04 or 84.05. -Before requesting a reduction or exemptions from the customs department, one should check the customs tariff list for the specific item that has already been determined to be eligible for duty reduction or exemption. -If there is a new request to add machinery and equipment to the tariff list, the evidence of effectively operated documents are required, such as BAT providing information on the machinery’s capacity, the function of the machinery and processes for reducing pollution. (Note: Previously, an agency under the Ministry of Science and Technology conducted inspections, but it has now been replaced by the Ministry of Higher Education, Science, Research, and Innovation.) -The process for adding items to import duty exemption/reduction on machinery list involves the Ministry of Industry, through the Bureau of Industrial Economics, writing to the Customs Department, the Ministry of Finance. Both parties will engage in discussions, after which it will proceed through the Ministry of Finance's process. The Customs Department will consider this in collaboration with the Fiscal Policy Office and the Minister of Finance, and it is the duty of the Minister to present to the Cabinet for consideration and approval. 4.2.1. Option A: Voluntary, Multi-Measure Incentive Framework Option A emphasizes a voluntary, market-driven model that allows entrepreneurs to select from a broad menu of incentive measures based on their specific operational needs and technological readiness (see Fig. 2 ). Firms may simultaneously apply for multiple forms of support, including fiscal incentives (e.g., tax deductions, import duty exemptions), financial incentives (e.g., soft loans), direct subsidies for U-POPs reduction projects, and eco-certifications linked to green procurement policies. This approach is inherently flexible and entrepreneurial, catering to both large-scale foundries and smaller collectors. For example, a firm might simultaneously access a reduced-interest loan for capital investment, a tax deduction for verified emission reductions, and obtain green certification for participation in public procurement. The eco-labeling scheme, in this context, functions as a signal of compliance and environmental responsibility to downstream consumers and institutional buyers. However, Option A suffers from two critical weaknesses. First, it lacks a robust mechanism for forecasting fiscal outlays or prioritizing funding allocations, as firms may vary widely in their requests and emission profiles. Second, there is limited guidance on how to fairly distribute support among different stakeholder groups—particularly given the large number of scrap collectors (597 firms), recycling facilities (321 sites), downstream industries (499 entities), and end-users (428 companies). These ambiguities raise concerns about the program’s equity, transparency, and overall cost-effectiveness. 4.2.2. Option B: Conditional Incentives Based on Emission Performance Option B introduces a more structured, conditional framework in which economic incentives are allocated based on firms’ demonstrated emission performance relative to legally defined U-POPs standards (see Fig. 3 ). Firms are categorized into three groups: ( i ) those emitting above the legal threshold, ( ii ) those emitting at or below the threshold, and ( iii ) scrap collectors. This classification ensures a more targeted and performance-based allocation of resources. For firms exceeding the emission standard, the government offers time-bound financial assistance to support technological upgrades and process improvements. These include concessional loans, direct subsidies (e.g., via the BAT/BEP Fund), and scheduled transition periods for legal compliance. Conversely, firms already in compliance receive recognition in the form of green certifications, preferential procurement status, and tax benefits, encouraging continued environmental stewardship. For scrap collectors, incentives are oriented toward training programs, financial support for infrastructure improvements (e.g., equipment leasing), and inclusion in certified supply chains to enhance their environmental credentials and market access. While Option B improves the efficiency of resource allocation and enhances the link between incentives and environmental outcomes, it is not without drawbacks. Its primary weakness lies in limited motivation for firms already complying with emission standards to go beyond regulatory minima. Additionally, the high cost of obtaining eco-certifications and U-POPs testing may be prohibitive for SMEs, potentially resulting in unequal burdens across firm sizes. There is also a risk that some firms may opt to pay fines rather than invest in cleaner technologies, undermining the policy’s environmental integrity. 4.2.3. Option C: Differentiated Responsibilities and Tailored Incentives Option C offers a refined approach that explicitly differentiates incentives based on firm size, emission levels, and role in the value chain (see Fig. 4 ). It seeks to promote fairness and proportionality by ensuring that larger firms with greater capacities bear a larger share of responsibility, while SMEs are supported with greater financial assistance to overcome implementation barriers. Incentive packages are calibrated according to emission profiles and firm characteristics. For small- and medium-sized enterprises emitting above the legal threshold, Option C proposes higher levels of subsidy (e.g., X% of BAT/BEP expenses), free or subsidized eco-certification, and extended payback periods for concessional loans. It also includes free training programs and technical assistance to facilitate compliance. For large firms, the same incentives are offered but at a reduced rate (e.g., 0.5X%), reflecting their greater resource base and administrative capacity. Firms already meeting emission standards are rewarded with certification, marketing advantages, and green industry recognition. These firms are also eligible for preferential treatment in procurement schemes and may leverage their environmental credentials in export markets and stakeholder communications. Option C is underpinned by three key strengths. First, it aligns with the principle of differentiated responsibility, encouraging equity across diverse firm types. Second, it allows for clearer forecasting of government expenditures and more precise targeting of resources, increasing the efficiency and transparency of public spending. Third, it supports long-term monitoring and evaluation of program outcomes, creating a feedback loop for continual policy refinement. Nevertheless, the implementation of Option C requires intensive inter-agency coordination, data collection, and monitoring, thereby increasing transaction costs. Institutional collaboration between the MI, the Ministry of Natural Resources and Environment, and financial institutions is critical to its success. Furthermore, the design of performance benchmarks and certification protocols must be robust and transparent to maintain credibility and stakeholder trust. All three options provide viable pathways toward the reduction of U-POPs in Thailand’s metal recycling industry. Option A offers maximum flexibility but lacks enforcement rigor and fiscal predictability. Option B strengthens the performance link but may fall short in incentivizing continual improvement. Option C offers the most comprehensive and equitable solution, aligning financial incentives with firm capacities and environmental responsibilities, albeit at a higher administrative cost.vTo implement these strategies effectively, the MI should proceed in three steps: ( i ) define and enforce U-POPs emission standards with appropriate adjustment timelines; ( ii ) integrate emission-related criteria into existing fiscal and financial frameworks, including coordination with the Environmental Fund, Thai Industrial Standards Institute (TISI), and commercial banks; and ( iii ) develop new, targeted incentive mechanisms in collaboration with fiscal authorities, environmental regulators, and industrial associations. This multi-dimensional approach, if executed with precision and institutional alignment, can significantly advance Thailand’s commitment to cleaner industrial practices, reduce the health risks associated with U-POPs exposure, and support inclusive and sustainable economic development. 5. Integrated Policy Framework for Reducing U-POPs Emissions in Thailand’s Scrap Metal Recycling Industry: Stakeholder Consultations, Economic Incentives, and Investment Promotion Strategies The policy development was fundamentally based on an inclusive and consultative stakeholder engagement process. A series of formal consultation meetings occurred between July and August 2023, with participants from governmental agencies, commercial banks, private sector industries, academic institutions, civil society organizations, and media (see Table 5). The purpose of these discussions was to share findings from the initial policy draft and to request specific, practical feedback to enhance the relevance and acceptance of the suggested measures. The consultations were organized into three sessions aimed at specific stakeholder groups—government and finance, commercial sector, and civil society—culminating in a final integrative workshop. These forums facilitated multi-directional knowledge sharing and bolstered the policy's legitimacy by assuring stakeholder ownership and responsiveness to sector-specific issues. The consultation process yielded a consensus that Option C is the most viable approach for economic incentivization. This option includes financial and non-financial instruments, such as subsidies for eco-certification schemes (e.g., Green Industry and Eco-label programs), technical capacity building for business owners and employees, and transitional grace periods for the gradual implementation of U-POPs emission standards. Option C was preferred for its perceived effectiveness in promoting widespread use of BAT/BEP, its compatibility with existing economic frameworks employed by financial institutions and government entities, and its adaptability in enabling a three-year transition period. Minor modifications to Option C, guided by stakeholder feedback, encompassed support systems for small-scale collectors, technical aid for supply chain participants, and the implementation of collaborative leadership frameworks wherein more established enterprises aid smaller counterparts in compliance initiatives. The proposed BAT/BEP Fund, intended as a direct financing mechanism to expedite technology improvements, was suspended due to the significant fiscal load and administrative complexities associated with managing the fund across over 100 locations. The Environmental Fund—an established route with governance protocols—was endorsed as a more effective tool for distributing subsidies and grants. Accompanying this were suggested economic incentives, including exemptions from import tariffs for pollution control equipment and corporate income tax credits for both capital and operational expenses associated with environmental enhancements. These fiscal instruments necessitate comprehensive cost-benefit evaluations, cabinet-level endorsement, and must be executed in alignment with Thailand's principles of fiscal discipline and non-discrimination among economic sectors. The policy implements a detailed categorization of recycling facilities according to their production scale and technological proficiency. Of the 648 recycling facilities, 432 were classified as small and medium-sized (SM), while 216 were designated as large (L). The analysis further differentiates between ferrous and non-ferrous operations, highlighting the diverse technological standards and emission characteristics among sub-sectors. These classifications are crucial for customizing support measures and guaranteeing equitable compliance obligations. Facilities with restricted access to finance and technical proficiency may be prioritized for subsidized training, equipment subsidies, and collaborative integration into cleaner production networks. The findings emphasize the substantial financial impediment related to U-POPs sampling and laboratory analysis, which may surpass 100,000 Thai Baht per sample. The anticipated demand beyond 500 sample events per year, subsequent to the implementation of emission rules, necessitates an urgent enhancement of both public and commercial laboratory capacities. Consequently, the study recommends financial assistance in this domain, especially during the first implementation stage. The policy's financing strategy has been significantly enhanced by the incorporation of environmental loans provided by commercial banks. The August 2023 closing workshop convened representatives from prominent Thai banks and the Iron and Steel Institute of Thailand (ISIT) to deliberate on funding strategies for sustainable investments. Financial institutions including the Government Savings Bank, Kasikorn Bank, Krungthai Bank, and Bangkok Bank have launched tailored loan packages featuring diminished interest rates, prolonged repayment terms, and prerequisites for environmentally sustainable enterprises. Krungthai Bank provides five unique types of environmental loans, including interest-free innovation loans and solar cell installation loans, each with defined qualifying criteria and collateral stipulations. These financial instruments are essential for facilitating access to finance for enterprises, especially SMEs, in their shift to cleaner technology. The policy conducted a second round of consultations with regulatory authorities, including the DIWs, Board of Investment (BOI), Revenue Department, and Customs Department, from October to November 2023. The meetings offered technical elucidation and administrative guidance regarding the framework and viability of suggested incentive programs. The BOI specifically confirmed that smelters and foundries are included in the current promotional rights outlined in Announcement Nos. 8/2565, 9/2565, and 15/2565. The rights encompass corporate income tax exemptions (spanning three to eight years), import duty exemptions on machinery and raw materials, and non-tax incentives contingent upon the project's strategic alignment with national development objectives. Furthermore, BOI's Efficiency Enhancement Measures advocate for energy conservation and the reduction of environmental effect via investments in cutting-edge technologies. The Revenue Department issued recommendations on the fair implementation of tax incentives, advising that U-POPs-related deductions be categorized as general environmental measures applicable to all industrial sectors to prevent discriminatory policy effects. The department emphasized the necessity of obtaining cabinet approval for any planned fiscal measures and recommended alternate mechanisms, such as subsidies, to mitigate potential revenue losses. Concurrent negotiations with the Customs Department concentrated on optimizing the importation of pollution control apparatus. The department verified that numerous suggested machinery types currently meet the criteria for current duty exemptions and delineated the procedures for submitting technical documents to advocate for the addition of new equipment types to the exemption list. The BOI specified some activities within the steel and iron manufacturing industry that qualify for investment promotion. Incentive amounts are adjusted according to production methods, technological advancements, and environmental performance, with upstream and high-strength steel manufacturing receiving the most substantial help. These rules seek to enhance vertical integration and modernization in the scrap metal value chain while ensuring compliance with U-POPs emission regulations. The authors suggest extending the transition term for U-POPs standard implementation from three to five years to align with BOI investment promotion timetables and to provide adequate adaptation time for firms of differing capacities (see Fig. 5 ). The suggested implementation roadmap demonstrates a practical equilibrium of environmental necessities, economic viability, and institutional capability. The multi-stakeholder consultations, comprehensive economic modeling, and alignment with national investment and environmental policy frameworks establish this initiative as a paradigm for sustainable industrial transformation in Thailand and possibly in other developing economies facing analogous environmental challenges. 6. Revising Economic Incentives for U-POPs Reduction in Scrap Metal Recycling: Policy Recommendations and Strategic Implementation in Thailand The regulation of U-POPs, especially dioxins and furans emitted during scrap metal recycling, presents a policy issue due to the inadvertent character of these emissions. The conventional application of the Polluter Pays Principle (PPP) may be inadequate, as scrap metal recyclers sometimes lack authority over the composition of the input materials. To guarantee equity and efficacy, particularly in light of the technical disparities and operational scales among Thai businesses, a blend of financial, fiscal, and non-economic incentives is advised. Economic measurements based on the PPP should encompass three primary expense categories: the cost of emission reporting and verification, the cost of adapting existing technology to conform to BEP, and the expense of executing BAT. To facilitate this transition, both economic incentives (e.g., subsidies, loans, tax relief) and non-economic incentives (e.g., technical assistants, green labeling) are recommended. These metrics must be customized to suit various industrial kinds and capacities. Input from stakeholders and discussions with regulatory entities, such as the Department of Industrial Works (DIWs), BOI, Department of Revenue, and the Customs Department, have informed three viable incentive alternatives (A, B, and C). Option C was considered the most effective due to its comprehensive strategy that integrates financial incentives with a structured transition period of three to five years, facilitating BAT/BEP adoption and bolstering green certification initiatives. Private financial institutions have aligned their lending strategies with green economy ideas, providing low-interest loans for environmentally sustainable initiatives. SMEs interested in BAT/BEP are advised to visit the ISIT and engage with banks experienced in sustainable investment strategies. The Thai Metal Aluminum Company Limited exemplifies a significant case, since its successful shift to low-energy machinery is anticipated to generate returns within three years. The incentive structure identifies foundries as the sector necessitating the most significant assistance, especially through subsidies, tax deductions, and import duty exemptions. The BOI offers extensive assistance to pertinent industries, such as smelters and foundries, as detailed in its announcements for 2022 and 2023. Manufacturers seeking promotion must comply with dioxin emission requirements to be eligible for rewards. The Revenue Department advocates for comprehensive, non-discriminatory tax incentives for all factories engaged in dioxin monitoring or pollution-reduction enhancements. Exclusive advantages for specific sectors are disapproved, indicating that grant funding or subsidies could provide a more equal solution. The Customs Department mandates that reductions in import duties adhere to prescribed procedural standards and be substantiated by technical evidence and efficacy evaluations. The consultations resulted in the approval of a five-year transitional phase to promote thorough compliance, provide fair access to support measures, and optimize the practical advantages of policy execution. Stakeholder feedback highlighted the environmental and reputational advantages of implementing BAT/BEP, while financial assistance—through tax incentives, low-interest loans, and green certifications—was deemed crucial for facilitating and maintaining compliance. Various sorts of incentives are advised based on the size of the firm. Large and medium enterprises find tax deductions and subsidies advantageous, whereas tiny businesses may derive greater benefit from favorable lending conditions. Green labels, while now appealing to a small market, can be rendered more successful when integrated with domestic product labels like "Made in Thailand". Subsidy programs must be meticulously organized and substantiated by cost-benefit analyses, encompassing payback periods, net present values, and return on investment metrics. Clear guidelines will foster trust and engagement among stakeholders. Moreover, banking and financial companies have indicated their willingness to collaborate with government programs aimed at reducing U-POPs. Their partnership with industry stakeholders is essential, especially as energy-efficient and pollution-mitigating initiatives gain prominence within green finance frameworks. Various institutional frameworks are proposed to facilitate these policy directives. This encompasses the formation of committees to assess project eligibility for financial assistance, the establishment of BAT/BEP Consultative Centers to offer technical and procedural guidance, and the creation of preliminary certification units to facilitate the approval of environmentally sustainable machinery and processes. These steps will enable a seamless and transparent process for obtaining state and non-state incentives. Scrap metal collectors, although not direct emitters of U-POPs, indirectly affect the quality of recyclable input materials. Enhancing their procedures via training and the use of BAT/BEP can diminish contamination levels at the source. A specific study is proposed to assess the economic viability of implementing these practices in the collector part of the supply chain. The concluding element of the proposal encompasses a comprehensive implementation plan. The framework consists of three phases: ( i ) a one-year preparatory phase for the establishment of administrative structures and inter-agency coordination; ( ii ) a five-year transitional phase for the implementation of proposed incentives and technical measures; and ( iii ) a post-transition enforcement phase during which legal penalties for non-compliance are instituted. The preparation operations encompass the establishment of the BAT/BEP Consultative Center and Project Appraisal Committees, coordination with the BOI and financial institutions, and the formulation of standards for green factory certification and procurement advantages. Tariff exemptions and the sharing of knowledge via training programs are essential components. Throughout the transition, these entities will facilitate companies in obtaining financial assistance, applying for BOI benefits, and ensuring compliance. Ultimately, legal enforcement measures will guarantee that all companies comply with the mandated environmental requirements by the conclusion of the grace period. This cohesive framework harmonizes regulatory enforcement with supportive measures to successfully mitigate U-POPs, while recognizing the diverse capabilities of stakeholders. The proposed policies facilitate collaboration among government agencies, financial institutions, industry groups, and private enterprises, creating a viable road for cleaner manufacturing processes in Thailand's scrap metal recycling sector. 7. Conclusions & Recommendations The paper proposes a detailed regulatory framework aimed at diminishing U-POPs in Thailand's scrap metal recycling business by utilizing a variety of economic incentives suited to the sector's diversity. The framework integrates fiscal, financial, and consumer-driven procedures, recognizing the varied technological capabilities, financial resources, and roles of players, from small-scale collectors to large-scale foundries. The research findings confirm that the effective reduction of U-POPs cannot depend merely on regulatory enforcement; rather, it requires the deliberate implementation of incentives that link private sector actions with public environmental goals. Utilizing international case studies, stakeholder consultations, and empirical survey data, the study presents three implementation options, with Option C identified as the most equitable and contextually aware, providing differentiated responsibilities and customized incentives that enhance equity, administrative practicality, and sustained compliance. Based on these findings, numerous critical recommendations are proposed. The Ministry of Industry (MI), in collaboration with the Department of Industrial Works (DIW), should implement Option C as the primary strategy, establishing a five-year transition period to enable the gradual adoption of BAT/BEP. The government should establish a multi-agency collaborative framework that includes the Board of Investment (BOI), Revenue Department, Customs Department, and financial institutions to optimize the provision of fiscal and financial incentives, including import duty exemptions, corporate tax relief, concessional loans, and eco-certification subsidies. Third, it is essential to implement capacity-building programs, technical support centers, and supply chain integration measures to aid SMEs and informal sector participants in adopting cleaner production practices. Moreover, improved laboratory infrastructure and subsidized testing for U-POPs monitoring are essential for effective policy enforcement. To maintain momentum and promote innovation, commercial banks should broaden their green finance offerings, prioritizing environmentally certified businesses. Public-private partnerships and market-oriented instruments—such as eco-labels, green procurement requirements, and consumer awareness initiatives—can strengthen the economic justification for environmental compliance. Finally, systematic policy evaluations and stakeholder interactions must be institutionalized to facilitate iterative enhancements, adaptive governance, and transparent oversight of environmental and economic results. By adopting this comprehensive approach, Thailand can meet its commitments under the Stockholm Convention and establish itself as a regional leader in sustainable industrial growth. Declarations Author Contribution Niramon Sutummakid conceptualized the study and was responsible for drafting the manuscript, including the development of the business model. Ronbanchob Apiratikul conducted quantitative data analysis using statistical software. Darika Phothiruk provided legal consultations pertinent to the project's regulatory aspects. Pijitra Jomsri contributed her expertise in data science and statistical analysis. Teerawut Tunnukij, as Director of the Department of Primary Industries and Mines, Ministry of Industry, coordinated and facilitated in-depth stakeholder interviews. Siwatt Pongpiachan served as the principal investigator of the project and oversaw all aspects of its design, implementation, and supervision. Acknowledgement The authors wish to convey their profound appreciation to all individuals and institutions that facilitated the effective execution of this study. We express our gratitude to the Ministry of Industry of Thailand for its steadfast support and advice during the project. Gratitude is extended to the Department of Industrial Works (DIW), the Board of Investment (BOI), the Revenue Department, and the Customs Department for their technical insights and constructive criticism during the stakeholder engagements. This research was undertaken within the context of the project “Greening the Scrap Metal Value Chain through Promotion of Best Available Techniques/Best Environmental Practices (BAT/BEP) to Reduce U-POPs Releases from Recycling Facilities – Phase II”, which is funded by the Global Environment Facility (GEF Project ID: 9222). The financial assistance from the GEF has been pivotal in enabling data collection, stakeholder engagement, and policy analysis essential for the formulation of this complete incentive system. We recognize the significant contributions of corporate sector leaders, financial institutions, academic partners, and civil society organizations, whose active involvement and insightful ideas substantially enhanced the study. Finally, we express our gratitude to the National Institute of Development Administration (NIDA) for its institutional and logistical support to the research team. 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Challenge 33(2):42–46 Tue NM, Takahashi S, Subramanian A, Sakai S, Tanabe S (2013) Environmental contamination and human exposure to dioxin-related compounds in e-waste recycling sites of developing countries. Environ Science: Processes Impacts 15(7):1326–1331 Tysklind M, Söderström G, Rappe C, Hägerstedt LE, Burström E (1989) PCDD and PCDF emissions from scrap metal melting processes at a steel mill. Chemosphere 19(1–6):705–710 Zou C, Han J, Fu H (2012) Emissions of PCDD/Fs from steel and secondary nonferrous productions. Procedia Environ Sci 16:279–288 Additional Declarations No competing interests reported. Cite Share Download PDF Status: Posted Version 1 posted You are reading this latest preprint version Research Square lets you share your work early, gain feedback from the community, and start making changes to your manuscript prior to peer review in a journal. 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2","display":"","copyAsset":false,"role":"figure","size":560926,"visible":true,"origin":"","legend":"\u003cp\u003eProposed economic incentive Option A\u003c/p\u003e","description":"","filename":"2.jpg","url":"https://assets-eu.researchsquare.com/files/rs-6718493/v1/ae9984c0fc6a03cbed169611.jpg"},{"id":87036519,"identity":"c08d1cf1-28b0-4f65-aabc-54c0faf73468","added_by":"auto","created_at":"2025-07-18 13:21:16","extension":"jpg","order_by":3,"title":"Figure 3","display":"","copyAsset":false,"role":"figure","size":435025,"visible":true,"origin":"","legend":"\u003cp\u003eProposed economic incentive Option B\u003c/p\u003e","description":"","filename":"3.jpg","url":"https://assets-eu.researchsquare.com/files/rs-6718493/v1/d1b247e8b1d769471595f854.jpg"},{"id":87033372,"identity":"970447aa-ac8e-4fff-be74-59982466aff7","added_by":"auto","created_at":"2025-07-18 13:05:16","extension":"jpg","order_by":4,"title":"Figure 4","display":"","copyAsset":false,"role":"figure","size":604515,"visible":true,"origin":"","legend":"\u003cp\u003eProposed economic incentive Option C\u003c/p\u003e","description":"","filename":"4.jpg","url":"https://assets-eu.researchsquare.com/files/rs-6718493/v1/5f95b1fc2bc95cc331715047.jpg"},{"id":87033373,"identity":"67ec7c98-7a33-48a3-ace8-56f26838deb9","added_by":"auto","created_at":"2025-07-18 13:05:16","extension":"jpg","order_by":5,"title":"Figure 5","display":"","copyAsset":false,"role":"figure","size":56309,"visible":true,"origin":"","legend":"\u003cp\u003eProposed transition period for five years and timeline for implementation\u003c/p\u003e","description":"","filename":"5.jpg","url":"https://assets-eu.researchsquare.com/files/rs-6718493/v1/a1522422b94a7605fb5bf512.jpg"},{"id":96246403,"identity":"03ca1cbc-a782-4351-adf7-25137afc47c2","added_by":"auto","created_at":"2025-11-19 07:25:54","extension":"pdf","order_by":0,"title":"","display":"","copyAsset":false,"role":"manuscript-pdf","size":2758082,"visible":true,"origin":"","legend":"","description":"","filename":"manuscript.pdf","url":"https://assets-eu.researchsquare.com/files/rs-6718493/v1/395e4489-1795-403d-9c9a-c4f959d51228.pdf"}],"financialInterests":"No competing interests reported.","formattedTitle":"Designing Economic Incentives for U- POPs Reduction in Thailand’s Scrap Metal Recycling Sector: A BAT/BEP- Oriented Policy Framework","fulltext":[{"header":"1. Introduction","content":"\u003cp\u003eThe scrap metal recycling industry is vital to Thailand's industrial advancement, resource optimization, and ecological sustainability. This sector has considerable environmental challenges, notably the inadvertent emission of unintended persistent organic pollutants (U-POPs), including polychlorinated dibenzo-p-dioxins and polychlorinated dibenzofurans (PCDD/PCDF) (Nie et al., \u003cspan citationid=\"CR10\" class=\"CitationRef\"\u003e2012\u003c/span\u003e; Shen et al., \u003cspan citationid=\"CR16\" class=\"CitationRef\"\u003e2021\u003c/span\u003e; Tysklind et al., \u003cspan citationid=\"CR20\" class=\"CitationRef\"\u003e1989\u003c/span\u003e). These extremely hazardous chemicals are produced as by-products in high-temperature industrial operations, such as metal smelting, refining, and waste incineration (Abballe et al., \u003cspan citationid=\"CR1\" class=\"CitationRef\"\u003e2013\u003c/span\u003e; Hung et al., \u003cspan citationid=\"CR4\" class=\"CitationRef\"\u003e2015\u003c/span\u003e; Zou et al., \u003cspan citationid=\"CR21\" class=\"CitationRef\"\u003e2012\u003c/span\u003e). U-POPs provide significant hazards to human health and the environment owing to their persistence, bioaccumulation, and capacity for long-range environmental movement (Ajay et al., \u003cspan citationid=\"CR2\" class=\"CitationRef\"\u003e2022\u003c/span\u003e; Marinkovic et al., \u003cspan citationid=\"CR7\" class=\"CitationRef\"\u003e2010\u003c/span\u003e; Szajner et al., \u003cspan citationid=\"CR15\" class=\"CitationRef\"\u003e2021\u003c/span\u003e). As a signatory to the Stockholm Convention on Persistent Organic Pollutants, Thailand is legally and morally obligated to mitigate and, where possible, eradicate emissions of U-POPs from anthropogenic sources, including metal recycling factories. Mitigating U-POPs emissions in the metal recycling sector is a complicated endeavor that necessitates a comprehensive strategy integrating regulatory enforcement, technological advancement, institutional collaboration, and economic incentives. Economic incentives serve as a potentially formidable yet underexploited tool for encouraging environmentally responsible behavior and advancing the use of sophisticated pollution control systems (Kolstad, \u003cspan citationid=\"CR5\" class=\"CitationRef\"\u003e1986\u003c/span\u003e). Economic incentives can alter market dynamics and internalize environmental externalities, thereby promoting sustainable behaviors within the private sector (Tietenberg, \u003cspan citationid=\"CR18\" class=\"CitationRef\"\u003e1990\u003c/span\u003e). They can alleviate the financial strain of environmental compliance and investment in cleaner technology, particularly for small and medium-sized enterprises (SMEs) that encounter disproportionate expenses and obstacles in upgrading their equipment and operations.\u003c/p\u003e\u003cp\u003eThe Thai Ministry of Industry (MI) launched a comprehensive initiative named \u0026ldquo;Greening the Scrap Metal Value Chain through Promotion of Best Available Technique/Best Environmental Practice (BAT/BEP) to Reduce U-POPs Releases from Recycling Facilities \u0026ndash; Phase II (\u003cspan class=\"ExternalRef\"\u003e\u003cspan class=\"RefSource\"\u003ehttps://www.thegef.org/projects-operations/projects/9222\u003c/span\u003e\u003cspan address=\"https://www.thegef.org/projects-operations/projects/9222\" targettype=\"URL\" class=\"RefTarget\"\u003e\u003c/span\u003e\u003c/span\u003e)\u0026rdquo; in acknowledgment of these dynamics. This study seeks to develop and propose practical, inclusive, and scalable economic incentives tailored to the needs and constraints of industry stakeholders, building on the foundation established in Phase I (2019\u0026ndash;2021), which concentrated on identifying BAT/BEP pertinent to the sector. These incentives aim to function as policy instruments to encourage private enterprises to voluntarily implement cleaner technology and practices, thereby attaining the dual objectives of environmental preservation and economic competitiveness.\u003c/p\u003e\u003cp\u003eThe justification for implementing economic incentives is based on their adaptability, cost-efficiency, and capacity to cater to various business scales and technology capabilities. In contrast to command-and-control laws that enforce similar standards across industries irrespective of their financial or operational circumstances, economic incentives enable enterprises to select the most efficient route to compliance. Additionally, incentives like tax credits, low-interest loans, grants, and eco-labeling initiatives can encourage sustained investment in pollution control systems, mitigate operational risks, and enhance capital accessibility (Le et al., \u003cspan citationid=\"CR6\" class=\"CitationRef\"\u003e2024\u003c/span\u003e; Panayotou, \u003cspan citationid=\"CR12\" class=\"CitationRef\"\u003e1998\u003c/span\u003e; Paramasua et al., \u003cspan citationid=\"CR13\" class=\"CitationRef\"\u003e2023\u003c/span\u003e). When connected with environmental performance benchmarks, such as legally enforced U-POPs emission requirements, these incentives can stimulate comprehensive systemic change and foster innovation.\u003c/p\u003e\u003cp\u003eThe study team utilized a mixed-methods approach, incorporating literature studies, stakeholder engagements, field surveys, and in-depth interviews to formulate effective policy suggestions. International experiences were examined to derive insights on the efficacy and viability of diverse incentive programs, especially in developing nations with analogous industrial characteristics. The existing domestic instruments, including the BOI\u0026rsquo;s tax incentives, the Environmental Fund\u0026rsquo;s concessional loans, and SME Bank\u0026rsquo;s green financing initiatives, were evaluated to pinpoint opportunities for incorporating U-POPs reduction goals. Original survey data from stakeholders across several sub-sectors of the scrap metal value chain, including collectors, foundries, downstream businesses, regulators, and financial institutions, reinforced these findings.\u003c/p\u003e\u003cp\u003eConsultation findings indicate that although awareness of U-POPs and the advantages of BAT/BEP is increasing, economic factors continue to pose a significant obstacle to widespread implementation. The majority of operators demonstrated robust endorsement for fiscal incentives (e.g., tax exemptions on BAT/BEP-related investments), financial incentives (e.g., concessional loans and credit guarantees), and targeted subsidies, especially for capital-intensive enhancements such as exhaust gas treatment systems and automation technologies. Minor operators emphasized the necessity for streamlined access to funding methods, decreased bureaucracy, and capacity-building assistance. A group of stakeholders highlighted the prospective influence of eco-labels and green procurement in stimulating consumer demand for ecologically sustainable metal products.\u003c/p\u003e\u003cp\u003eThe study presents a three-tiered framework for economic incentives, classified into (\u003cem\u003ei\u003c/em\u003e) fiscal incentives, comprising tax reductions, corporate income tax exemptions, and import duty waivers; (\u003cem\u003eii\u003c/em\u003e) financial incentives, encompassing soft loans, credit enhancements, and loan interest subsidies; and (\u003cem\u003eiii\u003c/em\u003e) consumer incentives, featuring eco-label certification, green procurement promotion, and public information campaigns.\u003c/p\u003e\u003cp\u003eThis study enhances the debate on sustainable industrial policy and environmental governance in Southeast Asia by proposing a practical, evidence-based framework for economic incentives. It offers a framework for Thailand and other developing nations aiming to meet their obligations under the Stockholm Convention while promoting industrial innovation and inclusive economic development. The study emphasizes that environmental conservation and economic development can coexist; with appropriate incentives, the private sector can play a crucial role in the transition to a cleaner, healthier, and more sustainable future.\u003c/p\u003e"},{"header":"2. Research Methods","content":"\u003cp\u003eThis study utilized a thorough mixed-methods approach to create, assess, and enhance economic incentive mechanisms intended to mitigate U-POPs in Thailand's scrap metal recycling industry. The research technique incorporated literature reviews, stakeholder involvement, and empirical data gathering, in accordance with national environmental policy objectives and the provisions of the Stockholm Convention (see Fig.\u0026nbsp;\u003cspan refid=\"Fig1\" class=\"InternalRef\"\u003e1\u003c/span\u003e).\u003c/p\u003e\u003cp\u003e\u003c/p\u003e\u003cp\u003eThe initial phase comprised a comprehensive examination of both domestic and international literature regarding economic instruments for the management of U-POPs, emphasizing the relevance of subsidies, tax incentives, low-interest loans, and eco-labeling initiatives to encourage BAT/BEP. Comparative policy evaluations of case studies from Vietnam, Pakistan, and China were performed to evaluate the efficacy of incentives in analogous industries.\u003c/p\u003e\u003cp\u003eThis phase expanded on the findings from Phase I (2019\u0026ndash;2021), which involved comprehensive interviews with 27 stakeholders, by conducting updated surveys and interviews across five categories: collectors, foundries, downstream companies, sellers, and regulators. These interactions disclosed industry predilections, demonstrating a pronounced preference for tax-oriented incentives and financial assistance frameworks.\u003c/p\u003e\u003cp\u003eEmpirical data from structured surveys was analyzed to evaluate corporate expectations for BAT/BEP adoption, including expected advantages (e.g., cost reduction, environmental enhancement) and preferred types of governmental support. Results underscored the necessity for customized incentives contingent upon organizational size and capability to adhere to emission regulations. Subsequent to the development of the proposed economic instruments, multi-sectoral consultation meetings were convened in July and August 2023, utilizing both in-person and virtual formats. Participants comprised governmental entities, financial institutions, non-governmental organizations, and private sector stakeholders. Feedback was consolidated to enhance the incentive structures, assuring feasibility, fairness, and compliance with current regulatory frameworks.\u003c/p\u003e\u003cp\u003eThe concluding methodological phase entailed confirming the incentive system via further meetings with regulatory authorities and integrating stakeholder recommendations. This procedure confirmed the viability of incorporating the proposed incentives into Thailand's industrial policy and environmental rules.\u003c/p\u003e"},{"header":"3. Harnessing Economic Incentives for U-POPs Reduction: A Strategic Review of Policy Instruments to Promote BAT/BEP Adoption in Thailand and Beyond","content":"\u003cp\u003eEmpirical research from the European Union (EU) and other developing nations indicates that well-designed market-based mechanisms can substantially aid in the reduction of U-POPs (see Table\u0026nbsp;\u003cspan refid=\"Tab1\" class=\"InternalRef\"\u003e1\u003c/span\u003e). Emission taxes and product levies have been efficiently implemented for items such as pesticides, fertilizers, and chlorinated solvents. For instance, financial incentives within the EU have facilitated the use of certified stoves, flue gas purification systems, and high-temperature incineration to control U-POP emissions. These interventions, although elevating the expense of specific items, have facilitated the embrace of more sustainable practices, as seen by the increased costs of conventional pesticides and a heightened adoption of organic agricultural techniques.\u003c/p\u003e\u003cp\u003e\u003cdiv class=\"gridtable\"\u003e\u003ctable float=\"Yes\" id=\"Tab1\" border=\"1\"\u003e\u003ccaption language=\"En\"\u003e\u003cdiv class=\"CaptionNumber\"\u003eTable 1\u003c/div\u003e\u003cdiv class=\"CaptionContent\"\u003e\u003cp\u003eMarket-based instruments and examples of applications in chemical management (Slunge and Alpizar, \u003cspan citationid=\"CR17\" class=\"CitationRef\"\u003e2019\u003c/span\u003e)\u003c/p\u003e\u003c/div\u003e\u003c/caption\u003e\u003ccolgroup cols=\"3\"\u003e\u003cdiv align=\"left\" class=\"colspec\" colname=\"c1\" colnum=\"1\"\u003e\u003c/div\u003e\u003cdiv align=\"left\" class=\"colspec\" colname=\"c2\" colnum=\"2\"\u003e\u003c/div\u003e\u003cdiv align=\"left\" class=\"colspec\" colname=\"c3\" colnum=\"3\"\u003e\u003c/div\u003e\u003cthead\u003e\u003ctr\u003e\u003cth align=\"left\" colname=\"c1\"\u003e\u003cp\u003ePolicy Instruments\u003c/p\u003e\u003c/th\u003e\u003cth align=\"left\" colname=\"c2\"\u003e\u003cp\u003eDescription\u003c/p\u003e\u003c/th\u003e\u003cth align=\"left\" colname=\"c3\"\u003e\u003cp\u003eExample of Application\u003c/p\u003e\u003c/th\u003e\u003c/tr\u003e\u003c/thead\u003e\u003ctbody\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e\u003cp\u003eSubstance Tax\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c2\"\u003e\u003cp\u003eBy increasing the price of using a chemical, a tax incentivizes decreased use. Taxes are levied by the state, with proceeds going to the general budget. The level should reflect the damages caused by the production, use and disposal of the chemical, which in the absence of the tax would not be reflected in the market price of the input or final product.\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c3\"\u003e\u003cp\u003ePesticides, inorganic fertilizers, chlorinated solvents\u003c/p\u003e\u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e\u003cp\u003eWaste\u003c/p\u003e\u003cp\u003eCharge / Fee\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c2\"\u003e\u003cp\u003eA form of tax but revenues are typically earmarked. The level of a fee should reflect the cost of providing a specific service, such as processing hazardous waste.\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c3\"\u003e\u003cp\u003eHazardous waste, pesticide or chemical containers, tires, batteries\u003c/p\u003e\u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e\u003cp\u003eSubsidy\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c2\"\u003e\u003cp\u003eA subsidy is the mirror image of a tax. It can provide incentives to increase the use of alternative chemicals that are less hazardous. Authorities may want to subsidize learning and technology development.\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c3\"\u003e\u003cp\u003eSubsidies for organic farming, lead paint removal\u003c/p\u003e\u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e\u003cp\u003eSubsidy Removal\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c2\"\u003e\u003cp\u003eIn many cases, subsidies are introduced to deal with distributional concerns, yet may result in unsound practices from a health or environmental perspective. Hence, subsidy removal is considered a policy instrument in its own right.\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c3\"\u003e\u003cp\u003eRemoval of subsidies for the use of chemical fertilizers or pesticides\u003c/p\u003e\u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e\u003cp\u003eDeposit Refund\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c2\"\u003e\u003cp\u003eA surcharge is paid when purchasing potentially polluting products. A refund is received when returning the product to an approved center for recycling or disposal\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c3\"\u003e\u003cp\u003ePesticide or chemical containers, batteries and tires\u003c/p\u003e\u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e\u003cp\u003eTradable Emission Permit\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c2\"\u003e\u003cp\u003eAn overall level of \u0026lsquo;allowable\u0026rsquo; pollution is established and allocated among firms in the form of permits. These permits can be traded on a market at market prices\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c3\"\u003e\u003cp\u003eLead in petrol (trade among refineries), ozone-depleting substances (trade among producers and importers)\u003c/p\u003e\u003c/td\u003e\u003c/tr\u003e\u003c/tbody\u003e\u003c/colgroup\u003e\u003c/table\u003e\u003c/div\u003e\u003c/p\u003e\u003cp\u003eThe analysis incorporates comparative case studies from Vietnam, Pakistan, and China to exemplify national strategies for U-POPs reduction in the ferrous and non-ferrous metal industries. Vietnam and Pakistan highlighted technical support frameworks, environmental impact evaluations, and comprehensive pollution prevention initiatives (see Table\u0026nbsp;\u003cspan refid=\"Tab2\" class=\"InternalRef\"\u003e2\u003c/span\u003e) (Ali, 2023; Mohapatra et al., \u003cspan citationid=\"CR9\" class=\"CitationRef\"\u003e2023\u003c/span\u003e). In China, economic incentives were implemented to advance BAT/BEP in medical waste incinerator facilities, leading to a substantial decrease in dioxin emissions. Participating firms received financial assistance of RMB 1\u0026nbsp;million per facility, which accounted for about 67% of the investment cost for flue gas purification systems (Ren et al., \u003cspan citationid=\"CR14\" class=\"CitationRef\"\u003e2016\u003c/span\u003e). These programs were directed by the concepts of voluntariness, transparency, and performance-based disbursement, demonstrating a scalable model for other nations.\u003c/p\u003e\u003cp\u003e\u003cdiv class=\"gridtable\"\u003e\u003ctable float=\"Yes\" id=\"Tab2\" border=\"1\"\u003e\u003ccaption language=\"En\"\u003e\u003cdiv class=\"CaptionNumber\"\u003eTable 2\u003c/div\u003e\u003cdiv class=\"CaptionContent\"\u003e\u003cp\u003eAction plans for U-POPs reduction in industrial sectors of Vietnam and Pakistan\u003c/p\u003e\u003c/div\u003e\u003c/caption\u003e\u003ccolgroup cols=\"3\"\u003e\u003cdiv align=\"left\" class=\"colspec\" colname=\"c1\" colnum=\"1\"\u003e\u003c/div\u003e\u003cdiv align=\"left\" class=\"colspec\" colname=\"c2\" colnum=\"2\"\u003e\u003c/div\u003e\u003cdiv align=\"left\" class=\"colspec\" colname=\"c3\" colnum=\"3\"\u003e\u003c/div\u003e\u003cthead\u003e\u003ctr\u003e\u003cth align=\"left\" colname=\"c1\"\u003e\u003cp\u003eCountry\u003c/p\u003e\u003c/th\u003e\u003cth align=\"left\" colname=\"c2\"\u003e\u003cp\u003eAction plans for U-POPs reduction\u003c/p\u003e\u003cp\u003ein the ferrous and non-ferrous sectors\u003c/p\u003e\u003c/th\u003e\u003cth align=\"left\" colname=\"c3\"\u003e\u003cp\u003eSources\u003c/p\u003e\u003c/th\u003e\u003c/tr\u003e\u003c/thead\u003e\u003ctbody\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e\u003cp\u003eVietnam\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c2\"\u003e\u003cp\u003e(1) Detailed assessment of the individual industries of BEP options, U-POPs reduction, including needs and options for BAT.\u003c/p\u003e\u003cp\u003e(2) Introduce and effectively implement Guidelines on BAT/ BEP to release the sources of U-POPs (existing and new industry).\u003c/p\u003e\u003cp\u003e(3) Removing the barrier to the introduction of technology that minimizes U-POPs through the introduction of management practices.\u003c/p\u003e\u003cp\u003e(4) Promote technical institutions to support the implementation of cleaner production and BAT/BEP technologies.\u003c/p\u003e\u003cp\u003e(5) Apply the concept of environmental impact assessment for key industrial sources.\u003c/p\u003e\u003cp\u003e(6) Assessing synergies for the reduction of unintentional POPs, GHG, mercury and other priority pollutants and where possible address these pollutants together.\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c3\"\u003e\u003cp\u003eMohapatra et al., \u003cspan citationid=\"CR9\" class=\"CitationRef\"\u003e2023\u003c/span\u003e\u003c/p\u003e\u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e\u003cp\u003ePakistan\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c2\"\u003e\u003cp\u003e(1) Assessment of the individual industries of BEP options, \u003c/p\u003e\u003cp\u003eU-POPs reduction, and needs, options for BAT, including Environmental Impact Assessment (EIA).\u003c/p\u003e\u003cp\u003e(2) Assessing synergies for the reduction of U-POPs, mercury, PM, GHG and other relevant pollutants and where feasible address pollutants in an integrated manner.\u003c/p\u003e\u003cp\u003e(3) Introduce and effectively implement BEP and where required/possible BAT, U-POPs reduction measures (best within integrated pollution prevention and control).\u003c/p\u003e\u003cp\u003e(4) Develop/promote institutions with the technical capacity to support the implementation of cleaner production (BEP), BAT for IPPC.\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c3\"\u003e\u003cp\u003eAli, 2023\u003c/p\u003e\u003c/td\u003e\u003c/tr\u003e\u003c/tbody\u003e\u003c/colgroup\u003e\u003c/table\u003e\u003c/div\u003e\u003c/p\u003e\u003cp\u003eThailand has implemented a combination of fiscal, financial, and institutional incentives to encourage the adoption of BAT/BEP. The Board of Investment (BOI) provides tax advantages under the Seven-Year Investment Promotion Strategy (2015\u0026ndash;2021), focusing on sectors including steel, chemicals, recycling, and energy (Fan and Wu, \u003cspan citationid=\"CR3\" class=\"CitationRef\"\u003e2017\u003c/span\u003e). Projects that satisfy BOI's environmental and technical standards are eligible for corporate tax deductions, reductions in import duties, and non-fiscal advantages including land ownership rights and permits for foreign specialists. Moreover, enhancements in energy efficiency and environmental performance are incentivized by supplementary rewards, such as three-year tax exemptions and waivers on machinery import duties.\u003c/p\u003e\u003cp\u003eIn addition to BOI's economic incentives, the Environmental Fund\u0026mdash;created under the 1992 National Environmental Quality Promotion and Protection Act\u0026mdash;offers grants and concessional loans to both commercial and public sector entities. Funding facilitates the development and enhancement of wastewater treatment and air pollution control systems, in addition to the implementation of clean technology. Private enterprises qualify for low-interest loans (2\u0026ndash;3% annually) with a repayment grace period of up to two years and a maximum duration of seven years, thereby promoting long-term investments in pollution control infrastructure.\u003c/p\u003e\u003cp\u003eAdditionally, Thailand\u0026rsquo;s SME Bank provides financial assistance to small and medium-sized firms (SMEs) who are adopting environmentally friendly business models in accordance with the national Bio-Circular-Green (BCG) Economy policy. Qualified projects centered on energy saving and renewable energy may obtain loans of up to 50\u0026nbsp;million baht for a duration of 10 years, with competitive interest rates commencing at 4.5%. This effort corresponds with a comprehensive governmental policy to integrate environmental factors into economic development.\u003c/p\u003e\u003cp\u003eLiterature highlights the essential importance of availability to BAT/BEP technology in meeting national objectives for U-POPs reduction. Although non-economic incentives\u0026mdash;such as legal frameworks, environmental evaluations, and technical support\u0026mdash;are significant, the involvement of the private sector is predominantly contingent upon explicit financial incentives. Compliance with legislative criteria alone does not guarantee proactive environmental performance; thus, economic incentives are crucial for promoting the voluntary adoption of cleaner technologies.\u003c/p\u003e\u003cp\u003eThe review suggests many economic policy alternatives suited to Thailand's industrial environment. These encompass: (\u003cem\u003ei\u003c/em\u003e) subsidies for installation and operational expenses related to BAT/BEP, potentially sourced from national budgets or environmental funds; (\u003cem\u003eii\u003c/em\u003e) U-POP emission taxes that represent the social cost of pollution and incentivize industries to reduce emissions; and (\u003cem\u003eiii\u003c/em\u003e) product levies on items with possible U-POP emissions throughout their lifecycle, with proceeds allocated to pollution mitigation efforts. Furthermore, fiscal incentives, like tax reliefs for low-income enterprises engaging in cleaner technology, as well as financial incentives through soft loans, increased credit limits, or grace periods, are advised to reduce compliance costs and promote private sector change.\u003c/p\u003e\u003cp\u003eUltimately, the implementation of eco-labels can significantly impact customer behavior and improve company reputation. Products or services that adhere to particular environmental standards may obtain certification from third-party organizations, indicating conformity with BAT/BEP criteria. Eco-labels promote sustainable consumption and function as non-tariff measures, providing competitive advantages over environmentally detrimental imported products.\u003c/p\u003e\u003cp\u003eIn summary, a combination of regulatory enforcement, financial incentives, and market-based instruments is crucial for advancing the lowering of U-POPs in Thailand. The successful execution of policy will rely on institutional capability, industry preparedness, and the creation of specialized financing structures to facilitate long-term environmental objectives.\u003c/p\u003e"},{"header":"4. Strategic Economic Incentives for the Reduction of U-POPs in Thailand’s Metal Recycling Industry","content":"\u003cp\u003eThis policy framework presents an integrated set of economic instruments aimed at reducing U-POPs from the ferrous and non-ferrous metal recycling industry in Thailand. U-POPs\u0026mdash;particularly dioxins and furans\u0026mdash;pose a critical environmental and public health risk, especially in developing countries undergoing rapid industrialization (Minh et al., \u003cspan citationid=\"CR8\" class=\"CitationRef\"\u003e2003\u003c/span\u003e; Nguyen et al., \u003cspan citationid=\"CR11\" class=\"CitationRef\"\u003e2003\u003c/span\u003e; Tue et al., \u003cspan citationid=\"CR19\" class=\"CitationRef\"\u003e2013\u003c/span\u003e). In recognition of this challenge, the MI is advised to employ a multi-tiered incentive strategy that combines fiscal, financial, and consumer-based mechanisms. These measures are structured to promote the adoption of BAT/BEP in both small- and large-scale recycling operations. Given the sector\u0026rsquo;s heterogeneity, economic incentives must address the varying capacities of stakeholders, including scrap collectors, foundries, downstream industries, and end-users. Survey and interview data indicate that firms face considerable financial barriers in adopting BAT/BEP technologies, especially those related to exhaust gas treatment and automated control systems. Despite these costs, many enterprises recognize the benefits of implementation, which include reduced emissions, enhanced corporate reputation, and potential cost savings in the long term.\u003c/p\u003e\u003cdiv id=\"Sec4\" class=\"Section2\"\u003e\u003ch2\u003e4.1. Overview of Economic Incentives\u003c/h2\u003e\u003cp\u003eA range of incentive mechanisms are proposed, including corporate tax deductions for environmental investments, import tariff reductions on BAT/BEP-related machinery, low-interest loans, direct subsidies, eco-labeling programs, and green procurement initiatives. A dedicated BAT/BEP Fund is also recommended to facilitate co-financing of capital and operational expenditures associated with U-POPs mitigation. The fund could be housed under existing financial mechanisms such as the Environmental Fund or the Energy Conservation Fund, with administrative oversight by the MI and associated regulatory bodies. Verified emission reductions\u0026mdash;based on certified testing\u0026mdash;would serve as the basis for accessing these benefits.\u003c/p\u003e\u003c/div\u003e\u003cdiv id=\"Sec5\" class=\"Section2\"\u003e\u003ch2\u003e4.2. Detailed Analysis of Policy Options\u003c/h2\u003e\u003cp\u003eThe framework outlines three implementation options\u0026mdash;Option A, Option B, and Option C\u0026mdash;each reflecting different approaches to incentive allocation, stakeholder targeting, and administrative feasibility (see Table\u0026nbsp;\u003cspan refid=\"Tab3\" class=\"InternalRef\"\u003e3\u003c/span\u003e). These options are designed to guide the MI in structuring a coherent, scalable, and results-oriented policy architecture.\u003c/p\u003e\u003cp\u003e\u003cdiv class=\"gridtable\"\u003e\u003ctable float=\"Yes\" id=\"Tab3\" border=\"1\"\u003e\u003ccaption language=\"En\"\u003e\u003cdiv class=\"CaptionNumber\"\u003eTable 3\u003c/div\u003e\u003cdiv class=\"CaptionContent\"\u003e\u003cp\u003eComparison of the three proposed options for economic incentives\u003c/p\u003e\u003c/div\u003e\u003c/caption\u003e\u003ccolgroup cols=\"4\"\u003e\u003cdiv align=\"left\" class=\"colspec\" colname=\"c1\" colnum=\"1\"\u003e\u003c/div\u003e\u003cdiv align=\"left\" class=\"colspec\" colname=\"c2\" colnum=\"2\"\u003e\u003c/div\u003e\u003cdiv align=\"left\" class=\"colspec\" colname=\"c3\" colnum=\"3\"\u003e\u003c/div\u003e\u003cdiv align=\"left\" class=\"colspec\" colname=\"c4\" colnum=\"4\"\u003e\u003c/div\u003e\u003cthead\u003e\u003ctr\u003e\u003cth align=\"left\" colname=\"c1\" morerows=\"1\" rowspan=\"2\"\u003e\u003cp\u003eTopic\u003c/p\u003e\u003c/th\u003e\u003cth align=\"left\" colspan=\"3\" nameend=\"c4\" namest=\"c2\"\u003e\u003cp\u003eProposals on Economic Incentives\u003c/p\u003e\u003c/th\u003e\u003c/tr\u003e\u003ctr\u003e\u003cth align=\"left\" colname=\"c2\"\u003e\u003cp\u003eProposal 1\u003c/p\u003e\u003c/th\u003e\u003cth align=\"left\" colname=\"c3\"\u003e\u003cp\u003eProposal 2\u003c/p\u003e\u003c/th\u003e\u003cth align=\"left\" colname=\"c4\"\u003e\u003cp\u003eProposal 3\u003c/p\u003e\u003c/th\u003e\u003c/tr\u003e\u003c/thead\u003e\u003ctbody\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e\u003cp\u003eIncentive Details\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c2\"\u003e\u003cp\u003eIncentive measures are specified in many cases, allowing entrepreneurs to choose from various measures according to their preferences (entrepreneurs can choose more than one measure).\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c3\"\u003e\u003cp\u003eIncentive measures are categorized based on the conditions for releasing U-POPs, divided into three groups: those that still release substances above the limit, those releasing substances equal to or below the limit, and the scrap metal collection business group, with emphasis placed on the origin of U-POPs.\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c4\"\u003e\u003cp\u003eIncentives are provided for each specific group of entrepreneurs, designed to promote financial fairness and facilitate access to BEP/BAT, to reduce emissions simultaneously.\u003c/p\u003e\u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e\u003cp\u003eEntrepreneur\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c2\"\u003e\u003cp\u003eEntrepreneurs have the freedom to apply for:\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c3\"\u003e\u003cp\u003e- Fiscal measures (taxes)\u003c/p\u003e\u003cp\u003e- Financial measures \u003c/p\u003e\u003cp\u003e(low-interest loans)\u003c/p\u003e\u003cp\u003e- Requesting subsidies\u003c/p\u003e\u003cp\u003e- Certification/Green Procurement\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c4\"\u003e\u003cp\u003eThese entrepreneurs are divided into three groups:\u003c/p\u003e\u003cp\u003e- General entrepreneurs\u003c/p\u003e\u003cp\u003e- Entrepreneurs meeting the criteria for release standards\u003c/p\u003e\u003cp\u003e- Metal sorters\u003c/p\u003e\u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e\u003cp\u003eAdvantages\u003c/p\u003e\u003cp\u003e(Pros)\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c2\"\u003e\u003cp\u003eEach entrepreneur can opt the incentive measures to receive support, with the responsible government agency screening the projects the entrepreneur proposes.\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c3\"\u003e\u003cp\u003eProvide strong incentives for entrepreneurs who are still unable to reduce their emissions due to financial constraints.\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c4\"\u003e\u003cp\u003e(a) This approach relies on the principles of shared responsibility that vary among entrepreneurs of different sizes and types of businesses.\u003c/p\u003e\u003cp\u003e(b) The government sector can assess the budget situation and provide support guidelines for various entrepreneurs.\u003c/p\u003e\u003cp\u003e(c) Evaluation of performance or follow up measures.\u003c/p\u003e\u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e\u003cp\u003eDisadvantages\u003c/p\u003e\u003cp\u003e(Cons)\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c2\"\u003e\u003cp\u003e(a) The government sector is facing challenges in evaluating budgets and establishing support guidelines for various entrepreneurs.\u003c/p\u003e\u003cp\u003e(b) Difficulty arises in determining clear guidelines for fair distribution of support among different types of businesses, including determining the appropriate level of assistance for each group.\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c3\"\u003e\u003cp\u003eConditions for entrepreneurs vary based on their individual businesses, with different types of end-users and downstream industries. Consequently, these measures prove ineffective in achieving the goal of substance reduction, as operators may be willing to pay fines if the release of substances exceeds the standard value.\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c4\"\u003e\u003cp\u003eTransaction costs also increase when coordinating with intensive operators for proper evaluation.\u003c/p\u003e\u003c/td\u003e\u003c/tr\u003e\u003c/tbody\u003e\u003c/colgroup\u003e\u003c/table\u003e\u003c/div\u003e\u003c/p\u003e\u003cp\u003e\u003cdiv class=\"gridtable\"\u003e\u003ctable float=\"Yes\" id=\"Tab4\" border=\"1\"\u003e\u003ccaption language=\"En\"\u003e\u003cdiv class=\"CaptionNumber\"\u003eTable 4\u003c/div\u003e\u003cdiv class=\"CaptionContent\"\u003e\u003cp\u003eConcise issues on incentive measures from additional consultation\u003c/p\u003e\u003c/div\u003e\u003c/caption\u003e\u003ccolgroup cols=\"2\"\u003e\u003cdiv align=\"left\" class=\"colspec\" colname=\"c1\" colnum=\"1\"\u003e\u003c/div\u003e\u003cdiv align=\"left\" class=\"colspec\" colname=\"c2\" colnum=\"2\"\u003e\u003c/div\u003e\u003cthead\u003e\u003ctr\u003e\u003cth align=\"left\" colname=\"c1\"\u003e\u003cp\u003eAgency meeting\u003c/p\u003e\u003c/th\u003e\u003cth align=\"left\" colname=\"c2\"\u003e\u003cp\u003eConcise issues from the meeting\u003c/p\u003e\u003c/th\u003e\u003c/tr\u003e\u003c/thead\u003e\u003ctbody\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e\u003cp\u003eDepartment of Industrial Works\u003c/p\u003e\u003cp\u003e(October 26, 2023)\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c2\"\u003e\u003cp\u003e-Implementing measures to promote entrepreneurs is a positive incentive, ensuring that entrepreneurs are well-informed about the available promotion and assistance.\u003c/p\u003e \u003cp\u003e-Requesting improvements to the criteria of GI3 or GI4 to include conditions related to the reduction of dioxins/furans for factory groups numbered 59 and 60. The Department of Primary Industries and Mines is required to send a letter to the GI Office, incorporating this request into the agenda for considering criteria when applying for GI.\u003c/p\u003e \u003cp\u003e\u003cb\u003e-\u003c/b\u003eSuggesting the classification of S-M-L factories into two groups: (1) S-M and (2) L. The current division based on horsepower may not accurately reflect actual emissions. In the future, if there is production rate information or fuel consumption available to support group division based on pollution levels, it can lead to improvements. Note: \"Factory grouping can be enhanced in the future according to production quantity information or apparent fuel consumption (when this information is available).\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e\u003cp\u003eBoard of Investment or BOI\u003c/p\u003e\u003cp\u003e(October 27, 2023)\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c2\"\u003e\u003cp\u003e-Factories, such as smelters, foundries, and metal facilities (manufacture of steels and irons), are eligible for investment promotion as listed in the Board of Investment (BOI) Announcement No. 9/2022, which outlines Measures to Promote Investment in Industries that are crucial to the Country's Development. The Criteria, rights and benefits for promoted projects are governed by the policies set out in the Board of Investment Announcement No. 8/2565 regarding policies and criteria for Investment Promotion.\u003c/p\u003e \u003cp\u003e-Project applicants must meet the qualifications outlined in the Investment Promotion Board Announcements No. 8/2022 and No. 15/2022, released on December 8, 2022, regarding Enhancement Measure for Smart and Sustainable Industry.\u003c/p\u003e\u003cp\u003e-Dioxin standards should be established when applying for promotion. If not, other parameters may need to be referenced to successfully mitigate environmental impacts.\u003c/p\u003e\u003cp\u003e-Brief steps to request promotion:\u003c/p\u003e\u003cp\u003e●Apply according to the BOI form to request promotion.\u003c/p\u003e\u003cp\u003e●Provide information in the form, such as details about existing machinery, new machinery, environmental technology, and pollution reduction.\u003c/p\u003e\u003cp\u003e●Submit a promotion request before making any purchases or proceeding with production improvements (apply and inform the machine specifications before purchasing).\u003c/p\u003e\u003cp\u003e●Promotion eligible consideration is on a case-by-case basis, under committee approval. In assessing the potential of machinery to reduce pollution, the BOI will make its considerations (DPIM can screen a potentially approving technology for production improvement or pollution control to minimize environmental impact).\u003c/p\u003e\u003cp\u003e●BOI will inspect pollution reduction as requested for promotion after the machine installation (evaluating the extent to which pollution can be reduced).\u003c/p\u003e\u003cp\u003e●Requests for investment promotion entitlement from BOI require facilities to enhance technologies, and the results must meet environmental standards or exceed the specified standards for success.\u003c/p\u003e\u003cp\u003e●BAT (Best Available Techniques) may be in the line on request promotion from BOI, but BEP (Best Environmental Practices) may not, depending on evaluation to determine eligibility for promotion.\u003c/p\u003e\u003cp\u003e-For a metal scrap sorting factory, investment promotion rights can be applied for, with the condition of an investment of 200\u0026nbsp;million baht onwards.\u003c/p\u003e \u003cp\u003e-Currently, the BOI is considering promoting scrap metal businesses for recycling (in the process of consideration yet to result).\u003c/p\u003e\u003cp\u003e-Consideration for promotion is divided into four levels:\u003c/p\u003e\u003cp\u003e(1) Not exceeding 40\u0026nbsp;million baht accepted by BOI officers.\u003c/p\u003e\u003cp\u003e(2) 40\u0026ndash;200\u0026nbsp;million baht accepted by the BOI working group.\u003c/p\u003e\u003cp\u003e(3) 200\u0026ndash;2,000\u0026nbsp;million baht accepted by Sub-committee (agency representative) considers.\u003c/p\u003e\u003cp\u003e(4) More than 2,000\u0026nbsp;million baht accepted by the Prime Minister of Thailand presides over consideration.\u003c/p\u003e\u003cp\u003e-The BOI promotes investment in machinery and software to improve production but excludes dioxin monitoring cost.\u003c/p\u003e\u003cp\u003e-The benefits that entrepreneurs will receive align with the BOI announcement.\u003c/p\u003e \u003cp\u003e-DPIM may need to be coordinated with the BOI on detailed information and discussions.\u003c/p\u003e\u003cp\u003e-In summary, the promotion request involves submitting a proposal to the BOI, which will consequently consider whether it can be provided as proposed, as well as any conditions or adjustments (DPIM Operation).\u003c/p\u003e\u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e\u003cp\u003eRevenue Department\u003c/p\u003e\u003cp\u003e(November 3, 2023)\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c2\"\u003e\u003cp\u003e-If the metal recycling facilities are eligible for BOI promotion, apply for promotion according to the BOI guidelines to access various benefits. If the factory falls outside the BOI promotion criteria, it will be covered by tax privileges from the Revenue Department.\u003c/p\u003e\u003cp\u003e-Granting tax deduction rights by the Revenue Department is generally open to everyone. It should apply to all factories measuring dioxins or improving machinery to reduce dioxins. Specific privileges, such as those for the group conducting dioxin measurement or enhancing environmentally friendly machinery for dioxin reduction within smelting, casting, and scrap metal factories (No. 59, 60, 106), should not be exclusively granted.\u003c/p\u003e \u003cp\u003e-Principles for requesting a tax deduction must include reasons for the request, ensuring fairness and non-discrimination across all industry groups. The policy should not impose a significant fiscal burden. An example of general promotion rights includes those for clean energy groups or reducing carbon dioxide production, without specifying a particular sector. Requests for tax deductions for a limited number of factories must be justified reasonably.\u003c/p\u003e \u003cp\u003e-Based on the calculation, the tax loss resulting from the cost of dioxin measurement is approximately 12,960,000 baht. This is derived by multiplying the number of factories (648) by the estimated measurement cost per year (100,000 baht), resulting in 64,000,000 baht, and then applying the corporate tax rate of 20%, resulting in the tax loss figure. It is recommended that assistance to entrepreneurs might be more appropriate in the form of assistance funds or subsidies.\u003c/p\u003e\u003cp\u003e-A study case that can compare to project is the announcement of the Director-General of the Revenue Department regarding income tax (No. 425) dated June 27, 2022, regarding the determination of types, criteria, methods, and conditions for exemption of corporate income tax for corporations paying for the purchase of biodegradable plastic products.\u003c/p\u003e\u003cp\u003e-When requesting a reduction in dioxin measurement fees, the analytical laboratory must be certified by a government agency. Payments must be made to a private entity or certified agency for the specified purpose. The request for expense reductions should cover all industries with the same measurement, being a general benefit rather than specific.\u003c/p\u003e\u003cp\u003e-In the case of BAT/BEP expenses, there must be proof or certification that such expenses can effectively reduce pollution.\u003c/p\u003e\u003cp\u003e-Considering the privilege to deduct dioxin measurement expenses as a tax deduction must be carried out at the Cabinet level. It must align with state policy, proposed by the Ministry of Finance, adhering to principles of fairness, non-discrimination, value, and maintaining fiscal discipline.\u003c/p\u003e\u003cp\u003e- The process for requesting tax deductions for dioxin measurement expenses or BAT/BEP-related expenses involves writing a letter to the Director-General of the Revenue Department. Department-level discussions, including a comprehensive analysis of necessary information such as market analysis, beneficiary classification, use of benefits, calculation of the number of benefits, cost-benefit analysis, tax assessment, KPI indicators, monitoring and evaluation, etc., should be conducted. If it is an important policy, the Minister of Industry must submit a letter to the Minister of Finance, initiating the process through the Permanent Secretary of the Ministry, and it is the duty of the Minister to present to the Cabinet for consideration and approval.\u003c/p\u003e\u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e\u003cp\u003eCustoms Department\u003c/p\u003e\u003cp\u003e(November 6, 2023)\u003c/p\u003e\u003c/td\u003e\u003ctd align=\"left\" colname=\"c2\"\u003e\u003cp\u003e\u003cb\u003e-\u003c/b\u003eThe policy of import duty exemption/reduction on machinery, primarily applies to machines used in the production process to lower production cost, thereby increasing revenue for the Revenue Department.\u003c/p\u003e\u003cp\u003e-An example list of machinery presented to the Customs Department, upon initial review, indicates that many items are already on the list of import duty-exempted or import duty-reduced items, such as those in item groups 84.04 or 84.05.\u003c/p\u003e \u003cp\u003e-Before requesting a reduction or exemptions from the customs department, one should check the customs tariff list for the specific item that has already been determined to be eligible for duty reduction or exemption.\u003c/p\u003e\u003cp\u003e-If there is a new request to add machinery and equipment to the tariff list, the evidence of effectively operated documents are required, such as BAT providing information on the machinery\u0026rsquo;s capacity, the function of the machinery and processes for reducing pollution. (Note: Previously, an agency under the Ministry of Science and Technology conducted inspections, but it has now been replaced by the Ministry of Higher Education, Science, Research, and Innovation.)\u003c/p\u003e\u003cp\u003e-The process for adding items to import duty exemption/reduction on machinery list involves the Ministry of Industry, through the Bureau of Industrial Economics, writing to the Customs Department, the Ministry of Finance. Both parties will engage in discussions, after which it will proceed through the Ministry of Finance's process. The Customs Department will consider this in collaboration with the Fiscal Policy Office and the Minister of Finance, and it is the duty of the Minister to present to the Cabinet for consideration and approval.\u003c/p\u003e\u003c/td\u003e\u003c/tr\u003e\u003c/tbody\u003e\u003c/colgroup\u003e\u003c/table\u003e\u003c/div\u003e\u003c/p\u003e\u003cdiv id=\"Sec6\" class=\"Section3\"\u003e\u003ch2\u003e4.2.1. Option A: Voluntary, Multi-Measure Incentive Framework\u003c/h2\u003e\u003cp\u003eOption A emphasizes a voluntary, market-driven model that allows entrepreneurs to select from a broad menu of incentive measures based on their specific operational needs and technological readiness (see Fig.\u0026nbsp;\u003cspan refid=\"Fig2\" class=\"InternalRef\"\u003e2\u003c/span\u003e). Firms may simultaneously apply for multiple forms of support, including fiscal incentives (e.g., tax deductions, import duty exemptions), financial incentives (e.g., soft loans), direct subsidies for U-POPs reduction projects, and eco-certifications linked to green procurement policies. This approach is inherently flexible and entrepreneurial, catering to both large-scale foundries and smaller collectors. For example, a firm might simultaneously access a reduced-interest loan for capital investment, a tax deduction for verified emission reductions, and obtain green certification for participation in public procurement. The eco-labeling scheme, in this context, functions as a signal of compliance and environmental responsibility to downstream consumers and institutional buyers. However, Option A suffers from two critical weaknesses. First, it lacks a robust mechanism for forecasting fiscal outlays or prioritizing funding allocations, as firms may vary widely in their requests and emission profiles. Second, there is limited guidance on how to fairly distribute support among different stakeholder groups\u0026mdash;particularly given the large number of scrap collectors (597 firms), recycling facilities (321 sites), downstream industries (499 entities), and end-users (428 companies). These ambiguities raise concerns about the program\u0026rsquo;s equity, transparency, and overall cost-effectiveness.\u003c/p\u003e\u003cp\u003e\u003c/p\u003e\u003c/div\u003e\u003cdiv id=\"Sec7\" class=\"Section3\"\u003e\u003ch2\u003e4.2.2. Option B: Conditional Incentives Based on Emission Performance\u003c/h2\u003e\u003cp\u003eOption B introduces a more structured, conditional framework in which economic incentives are allocated based on firms\u0026rsquo; demonstrated emission performance relative to legally defined U-POPs standards (see Fig.\u0026nbsp;\u003cspan refid=\"Fig3\" class=\"InternalRef\"\u003e3\u003c/span\u003e). Firms are categorized into three groups: (\u003cem\u003ei\u003c/em\u003e) those emitting above the legal threshold, (\u003cem\u003eii\u003c/em\u003e) those emitting at or below the threshold, and (\u003cem\u003eiii\u003c/em\u003e) scrap collectors. This classification ensures a more targeted and performance-based allocation of resources. For firms exceeding the emission standard, the government offers time-bound financial assistance to support technological upgrades and process improvements. These include concessional loans, direct subsidies (e.g., via the BAT/BEP Fund), and scheduled transition periods for legal compliance. Conversely, firms already in compliance receive recognition in the form of green certifications, preferential procurement status, and tax benefits, encouraging continued environmental stewardship. For scrap collectors, incentives are oriented toward training programs, financial support for infrastructure improvements (e.g., equipment leasing), and inclusion in certified supply chains to enhance their environmental credentials and market access. While Option B improves the efficiency of resource allocation and enhances the link between incentives and environmental outcomes, it is not without drawbacks. Its primary weakness lies in limited motivation for firms already complying with emission standards to go beyond regulatory minima. Additionally, the high cost of obtaining eco-certifications and U-POPs testing may be prohibitive for SMEs, potentially resulting in unequal burdens across firm sizes. There is also a risk that some firms may opt to pay fines rather than invest in cleaner technologies, undermining the policy\u0026rsquo;s environmental integrity.\u003c/p\u003e\u003cp\u003e\u003c/p\u003e\u003c/div\u003e\u003cdiv id=\"Sec8\" class=\"Section3\"\u003e\u003ch2\u003e4.2.3. Option C: Differentiated Responsibilities and Tailored Incentives\u003c/h2\u003e\u003cp\u003eOption C offers a refined approach that explicitly differentiates incentives based on firm size, emission levels, and role in the value chain (see Fig.\u0026nbsp;\u003cspan refid=\"Fig4\" class=\"InternalRef\"\u003e4\u003c/span\u003e). It seeks to promote fairness and proportionality by ensuring that larger firms with greater capacities bear a larger share of responsibility, while SMEs are supported with greater financial assistance to overcome implementation barriers. Incentive packages are calibrated according to emission profiles and firm characteristics. For small- and medium-sized enterprises emitting above the legal threshold, Option C proposes higher levels of subsidy (e.g., X% of BAT/BEP expenses), free or subsidized eco-certification, and extended payback periods for concessional loans. It also includes free training programs and technical assistance to facilitate compliance. For large firms, the same incentives are offered but at a reduced rate (e.g., 0.5X%), reflecting their greater resource base and administrative capacity. Firms already meeting emission standards are rewarded with certification, marketing advantages, and green industry recognition. These firms are also eligible for preferential treatment in procurement schemes and may leverage their environmental credentials in export markets and stakeholder communications. Option C is underpinned by three key strengths. First, it aligns with the principle of differentiated responsibility, encouraging equity across diverse firm types. Second, it allows for clearer forecasting of government expenditures and more precise targeting of resources, increasing the efficiency and transparency of public spending. Third, it supports long-term monitoring and evaluation of program outcomes, creating a feedback loop for continual policy refinement. Nevertheless, the implementation of Option C requires intensive inter-agency coordination, data collection, and monitoring, thereby increasing transaction costs. Institutional collaboration between the MI, the Ministry of Natural Resources and Environment, and financial institutions is critical to its success. Furthermore, the design of performance benchmarks and certification protocols must be robust and transparent to maintain credibility and stakeholder trust.\u003c/p\u003e\u003cp\u003e\u003c/p\u003e\u003cp\u003eAll three options provide viable pathways toward the reduction of U-POPs in Thailand\u0026rsquo;s metal recycling industry. Option A offers maximum flexibility but lacks enforcement rigor and fiscal predictability. Option B strengthens the performance link but may fall short in incentivizing continual improvement. Option C offers the most comprehensive and equitable solution, aligning financial incentives with firm capacities and environmental responsibilities, albeit at a higher administrative cost.vTo implement these strategies effectively, the MI should proceed in three steps: (\u003cem\u003ei\u003c/em\u003e) define and enforce U-POPs emission standards with appropriate adjustment timelines; (\u003cem\u003eii\u003c/em\u003e) integrate emission-related criteria into existing fiscal and financial frameworks, including coordination with the Environmental Fund, Thai Industrial Standards Institute (TISI), and commercial banks; and (\u003cem\u003eiii\u003c/em\u003e) develop new, targeted incentive mechanisms in collaboration with fiscal authorities, environmental regulators, and industrial associations. This multi-dimensional approach, if executed with precision and institutional alignment, can significantly advance Thailand\u0026rsquo;s commitment to cleaner industrial practices, reduce the health risks associated with U-POPs exposure, and support inclusive and sustainable economic development.\u003c/p\u003e"},{"header":"5. Integrated Policy Framework for Reducing U-POPs Emissions in Thailand’s Scrap Metal Recycling Industry: Stakeholder Consultations, Economic Incentives, and Investment Promotion Strategies","content":"\u003cp\u003eThe policy development was fundamentally based on an inclusive and consultative stakeholder engagement process. A series of formal consultation meetings occurred between July and August 2023, with participants from governmental agencies, commercial banks, private sector industries, academic institutions, civil society organizations, and media (see Table\u0026nbsp;5). The purpose of these discussions was to share findings from the initial policy draft and to request specific, practical feedback to enhance the relevance and acceptance of the suggested measures. The consultations were organized into three sessions aimed at specific stakeholder groups\u0026mdash;government and finance, commercial sector, and civil society\u0026mdash;culminating in a final integrative workshop. These forums facilitated multi-directional knowledge sharing and bolstered the policy's legitimacy by assuring stakeholder ownership and responsiveness to sector-specific issues.\u003c/p\u003e\u003cp\u003eThe consultation process yielded a consensus that Option C is the most viable approach for economic incentivization. This option includes financial and non-financial instruments, such as subsidies for eco-certification schemes (e.g., Green Industry and Eco-label programs), technical capacity building for business owners and employees, and transitional grace periods for the gradual implementation of U-POPs emission standards. Option C was preferred for its perceived effectiveness in promoting widespread use of BAT/BEP, its compatibility with existing economic frameworks employed by financial institutions and government entities, and its adaptability in enabling a three-year transition period. Minor modifications to Option C, guided by stakeholder feedback, encompassed support systems for small-scale collectors, technical aid for supply chain participants, and the implementation of collaborative leadership frameworks wherein more established enterprises aid smaller counterparts in compliance initiatives.\u003c/p\u003e\u003cp\u003eThe proposed BAT/BEP Fund, intended as a direct financing mechanism to expedite technology improvements, was suspended due to the significant fiscal load and administrative complexities associated with managing the fund across over 100 locations. The Environmental Fund\u0026mdash;an established route with governance protocols\u0026mdash;was endorsed as a more effective tool for distributing subsidies and grants. Accompanying this were suggested economic incentives, including exemptions from import tariffs for pollution control equipment and corporate income tax credits for both capital and operational expenses associated with environmental enhancements. These fiscal instruments necessitate comprehensive cost-benefit evaluations, cabinet-level endorsement, and must be executed in alignment with Thailand's principles of fiscal discipline and non-discrimination among economic sectors.\u003c/p\u003e\u003cp\u003eThe policy implements a detailed categorization of recycling facilities according to their production scale and technological proficiency. Of the 648 recycling facilities, 432 were classified as small and medium-sized (SM), while 216 were designated as large (L). The analysis further differentiates between ferrous and non-ferrous operations, highlighting the diverse technological standards and emission characteristics among sub-sectors. These classifications are crucial for customizing support measures and guaranteeing equitable compliance obligations. Facilities with restricted access to finance and technical proficiency may be prioritized for subsidized training, equipment subsidies, and collaborative integration into cleaner production networks.\u003c/p\u003e\u003cp\u003eThe findings emphasize the substantial financial impediment related to U-POPs sampling and laboratory analysis, which may surpass 100,000 Thai Baht per sample. The anticipated demand beyond 500 sample events per year, subsequent to the implementation of emission rules, necessitates an urgent enhancement of both public and commercial laboratory capacities. Consequently, the study recommends financial assistance in this domain, especially during the first implementation stage.\u003c/p\u003e\u003cp\u003eThe policy's financing strategy has been significantly enhanced by the incorporation of environmental loans provided by commercial banks. The August 2023 closing workshop convened representatives from prominent Thai banks and the Iron and Steel Institute of Thailand (ISIT) to deliberate on funding strategies for sustainable investments. Financial institutions including the Government Savings Bank, Kasikorn Bank, Krungthai Bank, and Bangkok Bank have launched tailored loan packages featuring diminished interest rates, prolonged repayment terms, and prerequisites for environmentally sustainable enterprises. Krungthai Bank provides five unique types of environmental loans, including interest-free innovation loans and solar cell installation loans, each with defined qualifying criteria and collateral stipulations. These financial instruments are essential for facilitating access to finance for enterprises, especially SMEs, in their shift to cleaner technology.\u003c/p\u003e\u003cp\u003eThe policy conducted a second round of consultations with regulatory authorities, including the DIWs, Board of Investment (BOI), Revenue Department, and Customs Department, from October to November 2023. The meetings offered technical elucidation and administrative guidance regarding the framework and viability of suggested incentive programs. The BOI specifically confirmed that smelters and foundries are included in the current promotional rights outlined in Announcement Nos. 8/2565, 9/2565, and 15/2565. The rights encompass corporate income tax exemptions (spanning three to eight years), import duty exemptions on machinery and raw materials, and non-tax incentives contingent upon the project's strategic alignment with national development objectives. Furthermore, BOI's Efficiency Enhancement Measures advocate for energy conservation and the reduction of environmental effect via investments in cutting-edge technologies. The Revenue Department issued recommendations on the fair implementation of tax incentives, advising that U-POPs-related deductions be categorized as general environmental measures applicable to all industrial sectors to prevent discriminatory policy effects. The department emphasized the necessity of obtaining cabinet approval for any planned fiscal measures and recommended alternate mechanisms, such as subsidies, to mitigate potential revenue losses. Concurrent negotiations with the Customs Department concentrated on optimizing the importation of pollution control apparatus. The department verified that numerous suggested machinery types currently meet the criteria for current duty exemptions and delineated the procedures for submitting technical documents to advocate for the addition of new equipment types to the exemption list.\u003c/p\u003e\u003cp\u003eThe BOI specified some activities within the steel and iron manufacturing industry that qualify for investment promotion. Incentive amounts are adjusted according to production methods, technological advancements, and environmental performance, with upstream and high-strength steel manufacturing receiving the most substantial help. These rules seek to enhance vertical integration and modernization in the scrap metal value chain while ensuring compliance with U-POPs emission regulations.\u003c/p\u003e\u003cp\u003eThe authors suggest extending the transition term for U-POPs standard implementation from three to five years to align with BOI investment promotion timetables and to provide adequate adaptation time for firms of differing capacities (see Fig.\u0026nbsp;\u003cspan refid=\"Fig5\" class=\"InternalRef\"\u003e5\u003c/span\u003e). The suggested implementation roadmap demonstrates a practical equilibrium of environmental necessities, economic viability, and institutional capability. The multi-stakeholder consultations, comprehensive economic modeling, and alignment with national investment and environmental policy frameworks establish this initiative as a paradigm for sustainable industrial transformation in Thailand and possibly in other developing economies facing analogous environmental challenges.\u003c/p\u003e"},{"header":"6. Revising Economic Incentives for U-POPs Reduction in Scrap Metal Recycling: Policy Recommendations and Strategic Implementation in Thailand","content":"\u003cp\u003eThe regulation of U-POPs, especially dioxins and furans emitted during scrap metal recycling, presents a policy issue due to the inadvertent character of these emissions. The conventional application of the Polluter Pays Principle (PPP) may be inadequate, as scrap metal recyclers sometimes lack authority over the composition of the input materials. To guarantee equity and efficacy, particularly in light of the technical disparities and operational scales among Thai businesses, a blend of financial, fiscal, and non-economic incentives is advised.\u003c/p\u003e\u003cp\u003eEconomic measurements based on the PPP should encompass three primary expense categories: the cost of emission reporting and verification, the cost of adapting existing technology to conform to BEP, and the expense of executing BAT. To facilitate this transition, both economic incentives (e.g., subsidies, loans, tax relief) and non-economic incentives (e.g., technical assistants, green labeling) are recommended. These metrics must be customized to suit various industrial kinds and capacities. Input from stakeholders and discussions with regulatory entities, such as the Department of Industrial Works (DIWs), BOI, Department of Revenue, and the Customs Department, have informed three viable incentive alternatives (A, B, and C). Option C was considered the most effective due to its comprehensive strategy that integrates financial incentives with a structured transition period of three to five years, facilitating BAT/BEP adoption and bolstering green certification initiatives.\u003c/p\u003e\u003cp\u003ePrivate financial institutions have aligned their lending strategies with green economy ideas, providing low-interest loans for environmentally sustainable initiatives. SMEs interested in BAT/BEP are advised to visit the ISIT and engage with banks experienced in sustainable investment strategies. The Thai Metal Aluminum Company Limited exemplifies a significant case, since its successful shift to low-energy machinery is anticipated to generate returns within three years. The incentive structure identifies foundries as the sector necessitating the most significant assistance, especially through subsidies, tax deductions, and import duty exemptions. The BOI offers extensive assistance to pertinent industries, such as smelters and foundries, as detailed in its announcements for 2022 and 2023. Manufacturers seeking promotion must comply with dioxin emission requirements to be eligible for rewards.\u003c/p\u003e\u003cp\u003eThe Revenue Department advocates for comprehensive, non-discriminatory tax incentives for all factories engaged in dioxin monitoring or pollution-reduction enhancements. Exclusive advantages for specific sectors are disapproved, indicating that grant funding or subsidies could provide a more equal solution. The Customs Department mandates that reductions in import duties adhere to prescribed procedural standards and be substantiated by technical evidence and efficacy evaluations.\u003c/p\u003e\u003cp\u003eThe consultations resulted in the approval of a five-year transitional phase to promote thorough compliance, provide fair access to support measures, and optimize the practical advantages of policy execution. Stakeholder feedback highlighted the environmental and reputational advantages of implementing BAT/BEP, while financial assistance\u0026mdash;through tax incentives, low-interest loans, and green certifications\u0026mdash;was deemed crucial for facilitating and maintaining compliance.\u003c/p\u003e\u003cp\u003eVarious sorts of incentives are advised based on the size of the firm. Large and medium enterprises find tax deductions and subsidies advantageous, whereas tiny businesses may derive greater benefit from favorable lending conditions. Green labels, while now appealing to a small market, can be rendered more successful when integrated with domestic product labels like \"Made in Thailand\". Subsidy programs must be meticulously organized and substantiated by cost-benefit analyses, encompassing payback periods, net present values, and return on investment metrics. Clear guidelines will foster trust and engagement among stakeholders. Moreover, banking and financial companies have indicated their willingness to collaborate with government programs aimed at reducing U-POPs. Their partnership with industry stakeholders is essential, especially as energy-efficient and pollution-mitigating initiatives gain prominence within green finance frameworks.\u003c/p\u003e\u003cp\u003eVarious institutional frameworks are proposed to facilitate these policy directives. This encompasses the formation of committees to assess project eligibility for financial assistance, the establishment of BAT/BEP Consultative Centers to offer technical and procedural guidance, and the creation of preliminary certification units to facilitate the approval of environmentally sustainable machinery and processes. These steps will enable a seamless and transparent process for obtaining state and non-state incentives.\u003c/p\u003e\u003cp\u003eScrap metal collectors, although not direct emitters of U-POPs, indirectly affect the quality of recyclable input materials. Enhancing their procedures via training and the use of BAT/BEP can diminish contamination levels at the source. A specific study is proposed to assess the economic viability of implementing these practices in the collector part of the supply chain.\u003c/p\u003e\u003cp\u003eThe concluding element of the proposal encompasses a comprehensive implementation plan. The framework consists of three phases: (\u003cem\u003ei\u003c/em\u003e) a one-year preparatory phase for the establishment of administrative structures and inter-agency coordination; (\u003cem\u003eii\u003c/em\u003e) a five-year transitional phase for the implementation of proposed incentives and technical measures; and (\u003cem\u003eiii\u003c/em\u003e) a post-transition enforcement phase during which legal penalties for non-compliance are instituted.\u003c/p\u003e\u003cp\u003eThe preparation operations encompass the establishment of the BAT/BEP Consultative Center and Project Appraisal Committees, coordination with the BOI and financial institutions, and the formulation of standards for green factory certification and procurement advantages. Tariff exemptions and the sharing of knowledge via training programs are essential components. Throughout the transition, these entities will facilitate companies in obtaining financial assistance, applying for BOI benefits, and ensuring compliance. Ultimately, legal enforcement measures will guarantee that all companies comply with the mandated environmental requirements by the conclusion of the grace period.\u003c/p\u003e\u003cp\u003eThis cohesive framework harmonizes regulatory enforcement with supportive measures to successfully mitigate U-POPs, while recognizing the diverse capabilities of stakeholders. The proposed policies facilitate collaboration among government agencies, financial institutions, industry groups, and private enterprises, creating a viable road for cleaner manufacturing processes in Thailand's scrap metal recycling sector.\u003c/p\u003e\u003c/div\u003e\u003c/div\u003e"},{"header":"7. Conclusions \u0026 Recommendations","content":"\u003cp\u003eThe paper proposes a detailed regulatory framework aimed at diminishing U-POPs in Thailand's scrap metal recycling business by utilizing a variety of economic incentives suited to the sector's diversity. The framework integrates fiscal, financial, and consumer-driven procedures, recognizing the varied technological capabilities, financial resources, and roles of players, from small-scale collectors to large-scale foundries. The research findings confirm that the effective reduction of U-POPs cannot depend merely on regulatory enforcement; rather, it requires the deliberate implementation of incentives that link private sector actions with public environmental goals. Utilizing international case studies, stakeholder consultations, and empirical survey data, the study presents three implementation options, with Option C identified as the most equitable and contextually aware, providing differentiated responsibilities and customized incentives that enhance equity, administrative practicality, and sustained compliance.\u003c/p\u003e\u003cp\u003eBased on these findings, numerous critical recommendations are proposed. The Ministry of Industry (MI), in collaboration with the Department of Industrial Works (DIW), should implement Option C as the primary strategy, establishing a five-year transition period to enable the gradual adoption of BAT/BEP. The government should establish a multi-agency collaborative framework that includes the Board of Investment (BOI), Revenue Department, Customs Department, and financial institutions to optimize the provision of fiscal and financial incentives, including import duty exemptions, corporate tax relief, concessional loans, and eco-certification subsidies. Third, it is essential to implement capacity-building programs, technical support centers, and supply chain integration measures to aid SMEs and informal sector participants in adopting cleaner production practices. Moreover, improved laboratory infrastructure and subsidized testing for U-POPs monitoring are essential for effective policy enforcement.\u003c/p\u003e\u003cp\u003eTo maintain momentum and promote innovation, commercial banks should broaden their green finance offerings, prioritizing environmentally certified businesses. Public-private partnerships and market-oriented instruments\u0026mdash;such as eco-labels, green procurement requirements, and consumer awareness initiatives\u0026mdash;can strengthen the economic justification for environmental compliance. Finally, systematic policy evaluations and stakeholder interactions must be institutionalized to facilitate iterative enhancements, adaptive governance, and transparent oversight of environmental and economic results. By adopting this comprehensive approach, Thailand can meet its commitments under the Stockholm Convention and establish itself as a regional leader in sustainable industrial growth.\u003c/p\u003e"},{"header":"Declarations","content":"\u003ch2\u003eAuthor Contribution\u003c/h2\u003e\u003cp\u003eNiramon Sutummakid conceptualized the study and was responsible for drafting the manuscript, including the development of the business model. Ronbanchob Apiratikul conducted quantitative data analysis using statistical software. Darika Phothiruk provided legal consultations pertinent to the project's regulatory aspects. Pijitra Jomsri contributed her expertise in data science and statistical analysis. Teerawut Tunnukij, as Director of the Department of Primary Industries and Mines, Ministry of Industry, coordinated and facilitated in-depth stakeholder interviews. Siwatt Pongpiachan served as the principal investigator of the project and oversaw all aspects of its design, implementation, and supervision.\u003c/p\u003e\u003ch2\u003eAcknowledgement\u003c/h2\u003e\u003cp\u003eThe authors wish to convey their profound appreciation to all individuals and institutions that facilitated the effective execution of this study. We express our gratitude to the Ministry of Industry of Thailand for its steadfast support and advice during the project. Gratitude is extended to the Department of Industrial Works (DIW), the Board of Investment (BOI), the Revenue Department, and the Customs Department for their technical insights and constructive criticism during the stakeholder engagements.\u003c/p\u003e\u003cp\u003eThis research was undertaken within the context of the project \u0026ldquo;Greening the Scrap Metal Value Chain through Promotion of Best Available Techniques/Best Environmental Practices (BAT/BEP) to Reduce U-POPs Releases from Recycling Facilities \u0026ndash; Phase II\u0026rdquo;, which is funded by the Global Environment Facility (GEF Project ID: 9222). The financial assistance from the GEF has been pivotal in enabling data collection, stakeholder engagement, and policy analysis essential for the formulation of this complete incentive system.\u003c/p\u003e\u003cp\u003eWe recognize the significant contributions of corporate sector leaders, financial institutions, academic partners, and civil society organizations, whose active involvement and insightful ideas substantially enhanced the study. Finally, we express our gratitude to the National Institute of Development Administration (NIDA) for its institutional and logistical support to the research team.\u003c/p\u003e"},{"header":"References","content":"\u003col\u003e\u003cli\u003e\u003cspan\u003eAbballe A, Barbieri PG, di Domenico A, Garattini S, Iacovella N, Ingelido AM, De Felip E (2013) Occupational exposure to PCDDs, PCDFs, and PCBs of metallurgical workers in some industrial plants of the Brescia area, northern Italy. Chemosphere 90(1):49\u0026ndash;56\u003c/span\u003e\u003c/li\u003e\u003cli\u003e\u003cspan\u003eAjay SV, Kirankumar PS, Varghese A, Prathish KP (2022) Assessment of dioxin-like POP\u0026rsquo;s emissions and human exposure risk from open burning of municipal solid wastes in streets and dumpyard fire breakouts. Exposure Health, 1\u0026ndash;16\u003c/span\u003e\u003c/li\u003e\u003cli\u003e\u003cspan\u003eFan B, Wu XY (2017) Influences Factors Between THAI FDI Policy and Regional Distribution of FDI\u0026mdash;Based on 77 Provinces During 1985\u0026ndash;2016 Panel Data. DEStech Trans Comput Sci Eng, 286\u0026ndash;291\u003c/span\u003e\u003c/li\u003e\u003cli\u003e\u003cspan\u003eHung PC, Chang CC, Chang SH, Chang MB (2015) Characteristics of PCDD/F emissions from secondary copper smelting industry. Chemosphere 118:148\u0026ndash;155\u003c/span\u003e\u003c/li\u003e\u003cli\u003e\u003cspan\u003eKolstad CD (1986) Empirical Properties of Economic Incentives and Command-and-Control Regulations for Air Pollution Control. Land Econ, \u003cem\u003e62\u003c/em\u003e(3)\u003c/span\u003e\u003c/li\u003e\u003cli\u003e\u003cspan\u003eLe P, Nguyen TN, Le C (2024) Navigating the Green Path: The Role of Climate Incentives in Shaping Eco-innovation and Firm Policies. Climate Governance and Corporate Eco-innovation: A Framework for Sustainable Companies. Springer Nature Switzerland, Cham, pp 65\u0026ndash;96\u003c/span\u003e\u003c/li\u003e\u003cli\u003e\u003cspan\u003eMarinkovic N, Pasalic D, Ferencak G, Grskovic B, Rukavina AS (2010) Dioxins and human toxicity. Arh Hig Rada Toksikol 61(4):445\u003c/span\u003e\u003c/li\u003e\u003cli\u003e\u003cspan\u003eMinh NH, Minh TB, Watanabe M, Kunisue T, Monirith I, Tanabe S, Prudente MS (2003) Open dumping site in Asian developing countries: a potential source of polychlorinated dibenzo-p-dioxins and polychlorinated dibenzofurans. Environ Sci Technol 37(8):1493\u0026ndash;1502\u003c/span\u003e\u003c/li\u003e\u003cli\u003e\u003cspan\u003eMohapatra P, N\u0026oslash;klebye E, Arora T, Basu AR (2023) International regulatory frameworks and best practices in management of POPs. Managing persistent organic pollutants in India: Case studies on Vapi and Surat, Gujarat. Springer Nature Switzerland, Cham, pp 127\u0026ndash;151\u003c/span\u003e\u003c/li\u003e\u003cli\u003e\u003cspan\u003eNie Z, Zheng M, Liu G, Liu W, Lv P, Zhang B, Xiao K (2012) A preliminary investigation of unintentional POP emissions from thermal wire reclamation at industrial scrap metal recycling parks in China. J Hazard Mater 215:259\u0026ndash;265\u003c/span\u003e\u003c/li\u003e\u003cli\u003e\u003cspan\u003eNguyen HM, Tu BM, Watanabe M, Kunisue T, Monirith I, Tanabe S, Prudente MS (2003) Open dumping site in Asian developing countries: a potential source of polychlorinated dibenz-p-dioxins and polychlorinated dibenzofurans. Environ Sci Technol 37(8):1493\u0026ndash;1502\u003c/span\u003e\u003c/li\u003e\u003cli\u003e\u003cspan\u003ePanayotou T (1998) \u003cem\u003eMarket Instruments and Consumption and Production Patterns\u003c/em\u003e (No. HDOCPA-1998-13). Human Development Report Office (HDRO), United Nations Development Programme (UNDP)\u003c/span\u003e\u003c/li\u003e\u003cli\u003e\u003cspan\u003eParamasua M, Devadason ES, Tehrani PM (2023) Stakeholders\u0026rsquo; perspectives on market-based instruments and trade policies for environmental goods: Evidence from Malaysia. Millennial Asia 14(4):480\u0026ndash;508\u003c/span\u003e\u003c/li\u003e\u003cli\u003e\u003cspan\u003eRen Y, Li Q, Ge Y, Jiang C, Ren Z (2016) Use incentive approach to promote BAT/BEP for centralized incineration facilities of medical waste in China. Procedia Environ Sci 31:457\u0026ndash;464\u003c/span\u003e\u003c/li\u003e\u003cli\u003e\u003cspan\u003eSzajner J, Czarny-Dzialak M, Dziechciaz M, Pawlas N, Walosik A (2021) Dioxin-like compounds (DLCs) in the environment and their impact on human health. J Elementology, \u003cem\u003e26\u003c/em\u003e(2)\u003c/span\u003e\u003c/li\u003e\u003cli\u003e\u003cspan\u003eShen J, Yang L, Liu G, Zhao X, Zheng M (2021) Occurrence, profiles, and control of unintentional POPs in the steelmaking industry: A review. Sci Total Environ 773:145692\u003c/span\u003e\u003c/li\u003e\u003cli\u003e\u003cspan\u003eSlunge D, Alpizar F (2019) Market-based instruments for managing hazardous chemicals: A review of the literature and future research agenda. Sustainability 11(16):4344\u003c/span\u003e\u003c/li\u003e\u003cli\u003e\u003cspan\u003eTietenberg TH (1990) Using economic incentives to maintain our environment. Challenge 33(2):42\u0026ndash;46\u003c/span\u003e\u003c/li\u003e\u003cli\u003e\u003cspan\u003eTue NM, Takahashi S, Subramanian A, Sakai S, Tanabe S (2013) Environmental contamination and human exposure to dioxin-related compounds in e-waste recycling sites of developing countries. Environ Science: Processes Impacts 15(7):1326\u0026ndash;1331\u003c/span\u003e\u003c/li\u003e\u003cli\u003e\u003cspan\u003eTysklind M, S\u0026ouml;derstr\u0026ouml;m G, Rappe C, H\u0026auml;gerstedt LE, Burstr\u0026ouml;m E (1989) PCDD and PCDF emissions from scrap metal melting processes at a steel mill. Chemosphere 19(1\u0026ndash;6):705\u0026ndash;710\u003c/span\u003e\u003c/li\u003e\u003cli\u003e\u003cspan\u003eZou C, Han J, Fu H (2012) Emissions of PCDD/Fs from steel and secondary nonferrous productions. Procedia Environ Sci 16:279\u0026ndash;288\u003c/span\u003e\u003c/li\u003e\u003c/ol\u003e"}],"fulltextSource":"","fullText":"","funders":[],"hasAdminPriorityOnWorkflow":false,"hasManuscriptDocX":true,"hasOptedInToPreprint":true,"hasPassedJournalQc":"","hasAnyPriority":false,"hideJournal":true,"highlight":"","institution":"","isAcceptedByJournal":false,"isAuthorSuppliedPdf":false,"isDeskRejected":"","isHiddenFromSearch":false,"isInQc":false,"isInWorkflow":false,"isPdf":false,"isPdfUpToDate":true,"isWithdrawnOrRetracted":false,"journal":{"display":true,"email":"[email protected]","identity":"researchsquare","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":true,"externalIdentity":"","sideBox":"","snPcode":"","submissionUrl":"/submission","title":"Research Square","twitterHandle":"researchsquare","acdcEnabled":true,"dfaEnabled":false,"editorialSystem":"","reportingPortfolio":"","inReviewEnabled":false,"inReviewRevisionsEnabled":true},"keywords":"Unintentional Persistent Organic Pollutants (U-POPs), Economic Incentives, Scrap Metal Recycling, Best Available Techniques (BAT), Best Environmental Practice (BEP), Environmental Policy Framework","lastPublishedDoi":"10.21203/rs.3.rs-6718493/v1","lastPublishedDoiUrl":"https://doi.org/10.21203/rs.3.rs-6718493/v1","license":{"name":"CC BY 4.0","url":"https://creativecommons.org/licenses/by/4.0/"},"manuscriptAbstract":"\u003cp\u003eThis 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.\u003c/p\u003e\u003cp\u003eThe study, conducted under the project \u0026ldquo;Greening the Scrap Metal Value Chain through Promotion of BAT/BEP to Reduce U-POPs Releases from Recycling Facilities \u0026ndash; Phase II\u0026rdquo;, 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: (\u003cem\u003ei\u003c/em\u003e) a voluntary multi-measure framework (Option A), (\u003cem\u003eii\u003c/em\u003e) a conditional reward scheme predicated on emission performance (Option B), and (\u003cem\u003eiii\u003c/em\u003e) a differentiated strategy customized to business size and technological capability (Option C).\u003c/p\u003e\u003cp\u003eOption 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.\u003c/p\u003e\u003cp\u003eEssential 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.\u003c/p\u003e\u003cp\u003eThis approach, aligned with the Stockholm Convention and Thailand\u0026rsquo;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.\u003c/p\u003e","manuscriptTitle":"Designing Economic Incentives for U- POPs Reduction in Thailand’s Scrap Metal Recycling Sector: A BAT/BEP- Oriented Policy Framework","msid":"","msnumber":"","nonDraftVersions":[{"code":1,"date":"2025-07-18 13:05:11","doi":"10.21203/rs.3.rs-6718493/v1","editorialEvents":[{"type":"communityComments","content":0}],"status":"published","journal":{"display":true,"email":"[email protected]","identity":"researchsquare","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":true,"externalIdentity":"","sideBox":"","snPcode":"","submissionUrl":"/submission","title":"Research Square","twitterHandle":"researchsquare","acdcEnabled":true,"dfaEnabled":false,"editorialSystem":"","reportingPortfolio":"","inReviewEnabled":false,"inReviewRevisionsEnabled":true}}],"origin":"","ownerIdentity":"a5871bba-8dad-43a2-90db-bffb233b069a","owner":[],"postedDate":"July 18th, 2025","published":true,"recentEditorialEvents":[],"rejectedJournal":[],"revision":"","amendment":"","status":"posted","subjectAreas":[],"tags":[],"updatedAt":"2025-11-16T18:23:27+00:00","versionOfRecord":[],"versionCreatedAt":"2025-07-18 13:05:11","video":"","vorDoi":"","vorDoiUrl":"","workflowStages":[]},"version":"v1","identity":"rs-6718493","journalConfig":"researchsquare"},"__N_SSP":true},"page":"/article/[identity]/[[...version]]","query":{"redirect":"/article/rs-6718493","identity":"rs-6718493","version":["v1"]},"buildId":"8U1c8b4HqxoKbykW_rLl7","isFallback":false,"isExperimentalCompile":false,"dynamicIds":[84888],"gssp":true,"scriptLoader":[]}