Introduction Lead exposure is a major but often overlooked public health issue in Southeast Asia. Across the region, unsafe recycling of used lead-acid batteries continues to poison millions—particularly children—and erode economic productivity. In the Philippines, more than one million children suffer from lead poisoning. In Indonesia, the number exceeds eight million. While lead exposure causes a range of health impacts, its most significant cost arises from impaired cognitive development in children, resulting in learning losses that translate to substantial economic consequences. A recent study estimates that lead exposure causes at least $115 billion in annual productivity losses in East Asia and the Pacific. Lead has long been used in battery production for over a century because it is inexpensive, reliable, and, importantly, recyclable. However, this recyclability turns deadly when done improperly. Unsafe lead-acid battery recycling is now the region’s biggest driver of lead exposure. Over 85% of global lead demand comes from batteries. The Cost of Informal Recycling When recycling is done properly with safety measures in place, lead-containing batteries can be recycled without exposing workers to harmful levels. Without protection, recycling is extremely hazardous for laborers and for surrounding communities. A study by the Asian Development Bank in Indonesia found that children living within three kilometers of an informal battery recycling site suffered learning losses equivalent to missing three years of primary school, while those living between three to six kilometers away lost numeracy skills equal to almost one and a half years. These cognitive impacts follow children into adulthood, limiting their earning potential and perpetuating cycles of poverty. Why Informal Recylers Dominate the Market In many Asian economies, the used lead-acid batteries market are divided into two: the formal recyclers, who are licensed and comply with environmental regulations, and the informal recyclers, who operate without permission or oversight. With informal recyclers not subject to safety standards and compliance costs imposed on formal recyclers, they can operate at lower costs, and offer higher payouts—gaining an advantage over formal recyclers. The Lead-Acid Battery Recycling Initiative in the Philippines found that informal collectors of used lead-acid batteries pay up to 50% more than formal collectors, creating a stronger financial incentive for sellers. The price advantage is impossible for formal recyclers to match while maintaining safety standards. The World Economic Forum estimates that up to half of used lead-acid batteries in low- and middle-income countries are recycled informally. The imbalance—not a lack of technology or regulation—keeps informal, unsafe recycling profitable. Changing the Market: Fiscal and Policy Tools that Work The key to reducing lead exposure is reshaping the market so that safe, formal recycling becomes more economically attractive. Several countries have adopted market-based mechanisms and fiscal approaches (e.g., tax exemptions) to make safe recycling more attractive to consumers and recyclers and at minimal cost to governments. These approaches have yet to be widely deployed in Asia. Three approaches have been particularly effective in reducing lead exposure from batteries: Deposit schemes: Charging a small deposit on the sale of new lead-acid battery, refundable upon return of a used one encourages consumers to sell to accredited recyclers. This program has operated effectively as a voluntary scheme (e.g., In South Africa, more than 90% of used lead-acid batteries are recycled in formal settings), and as a mandatory scheme (e.g., about 99% of used lead-acid batteries in the United States are formally recycled). Extended producer responsibility: Making importers and manufacturers of lead-acid batteries legally responsible for the end-of-life treatment of their batteries ensures proper collection and disposal. These schemes are in place across Europe and the US and have been adapted in Asia for plastics management in countries such as Singapore and the Philippines. Sales tax exemptions: Governments can improve the competitiveness of formal recycling by exempting used lead-acid batteries from sales taxes. Taxes on formal recyclers benefit informal ones because they do not pay sales tax on the batteries they purchase. In Brazil, combining sales tax exemptions with market-based policies cut informal recycling by more than half in five years. A Practical Path Forward The long-term benefits of reducing lead exposure far outweigh the costs of implementing market-shaping mechanisms. None of the mentioned solutions involves huge costs for the government or the industry. In Brazil, the policy changes to encourage formal recycling were revenue-neutral—the taxes collected from formal recyclers offset the cost of implementation. For Southeast Asia, adopting market-shaping and fiscal measures could significantly reduce lead exposure, protect millions of children from toxic lead, and contribute to sustainable growth across the region. Notes: Dr. Denese de Guzman, Jae Kyoun Kim, and Dr. Eduardo Banzon contributed to this article. Lead poisoning was part of the discussions during ADB's 1st INSPIRE Health Forum: Inclusive, Sustainable, Prosperous and Resilient (INSPIRE) Health Systems in Asia and the Pacific. Ask the Experts Tom Daniels Co-Founder, Lead-Acid Battery Recycling Initiative (LABRI) Tom Daniels is the co-executive director of LABRI, an international non-profit organization that supports safer recycling of used lead-acid batteries. Before co-founding LABRI, he worked as chief of staff at an international nutrition non-profit, as an economic policy official at the Bank of England, and as a commercial lawyer in the UK. He holds a postgraduate degree in law from the University of Law and an undergraduate degree in history from the University of Cambridge. Follow Tom Daniels on Micaella Rogers Co-Founder, Lead-Acid Battery Recycling Initiative Micaella is LABRI’s co-executive director. Before co-founding LABRI, she worked as an economic consultant in South Africa and as a research fellow for a nonprofit incubator in London. She holds a master’s degree in African studies from the University of Oxford and undergraduate degrees in economics and statistics from the University of Cape Town. Follow Micaella Rogers on Ben Coghlan Consultant, Asian Development Bank Dr. Ben Coghlan is a health security expert. He is a public health physician and medical epidemiologist focused on strengthening health systems to address major public health challenges in Asia and the Pacific. His work has covered COVID-19, climate and environmental change, aging and non-communicable diseases, digital transformation of healthcare, and universal health coverage. He is formerly a senior health specialist with ADB’s Health Team. Jasper Tromp Assistant Professor, NUS Saw Swee Hock School of Public Health Dr. Jasper Tromp focuses on improving the quality of care for non-communicable diseases (NCDs) in Southeast Asia, particularly in lower- and middle-income countries, and on how NCDs interact with tropical infectious diseases. He also works in the policy and implementation fields of digital health, with particular interest in interventions that facilitate task shifting of NCD care to primary care or non-physician healthcare workers. Leave your question or comment in the section below: View the discussion thread.