SYDNEY (REUTERS) - Australia said on Monday (July 6) it will set up a fund worth A$190 million (S$184 million) to support companies which convert garbage into manufactured products, a move it hopes will stop millions of tonnes of landfill, after China put curbs on waste imports.

The Recycling Modernisation Fund will go to companies involved in sorting, processing and reusing commonly discarded materials like plastic, paper, tyres and glass, the federal government said in a statement.

The payments would depend on co-investment from the country's eight state and territory governments, as well as the private sector.

The programme should attract about A$600 million of private investment, the statement said.

The decision to start the fund reflects the transitional state of the global waste management industry after China stopped accepting shipments of rubbish like plastic and paper in 2018, as part of a campaign against "foreign garbage".

The ban affects 1.25 million tonnes of Australian waste, worth an estimated A$850 million, according to official figures, although the government said the new fund would ultimately divert more than 10 million tonnes of plastic, paper and glass waste away from landfills.

"As we cease shipping our waste overseas, the waste and recycling transformation will reshape our domestic waste industry, driving job creation and putting valuable materials back into the economy," Environment Minister Sussan Ley said in the statement, which predicted the move would create 10,000 jobs.

The government would also spend A$24.6 million to improve data so it can measure progress on meeting the waste targets.

"This will mean Australia converts more waste into higher valued resources ready for reuse locally by manufacturers and brands in their packaging and products," said Ms Rose Read, chief executive of the National Waste and Recycling Industry Council.

"The legacy of this investment will also serve future generations."