The long-term effects of an efficient transition to a Circular Economy


In a Circular Economy, waste is considered a valuable resource. The concept is based on expanding the life cycle of products through reuse, recycling, repair and renovation so that the materials products are made of, or the products themselves, play a part in the economy for as long as possible. 

More than just being an environmental issue, a circular economy takes maximum advantage of resources especially scarce ones by avoiding waste. Initiatives around the world offer glimpses of the impact that adopting such practices would make if applied on a global scale. This year’s Tokyo Olympics offered a prime example: by recycling 79,000 tonnes of smart phones and other electronic items the 5,000 medals were made.  

To understand the impact of recovering metals from electronic appliances, it is worth to note that there is 100 times more gold in a ton of discarded mobile phones than there is in a ton of gold ore.

Research shows that creating a circular economy brings $4.5 trillion in economic opportunities by creating business growth and employment opportunities through avoiding waste. Doing so requires a multi-tiered approach where everyone is involved from citizens to governments.  

Reducing consumption is one of the main motivations behind creating a circular economy. During the 20th century, the world’s use of raw materials grew twice as much as the population with the richest countries consuming 10 times as much as the poorest. In business models the main principle is based on selling as much as possible. In this respect behaviour change to influence consumer demand and innovation in business backed up by policies are key.

Consuming better is another factor. Awareness and taking into consideration the environmental impact making a product has, helps choosing products produced in sustainable ways while avoiding those that are created through environmentally harmful methods. The same goes knowing that a product chosen is easy to recycle or reuse. Awareness of sustainability is on the rise among consumers. Better consumption puts pressure by consumers and is crucial to encourage businesses to shift to environmentally friendly practices, while offering opportunities for innovation especially if backed up by incentives.

Incentives and policies are a strong factor that can help create systemic change. Placing taxes for example on products that use only new materials and offering incentives for using circular models in production and the lifecycle of products would contribute significantly to creating a circular economy. Some companies already use circular models where for example specialised equipment are taken back and repaired, refurbished or have their materials repurposed. Scaling this model to a broader range of consumer products would bring us closer to a circular economy.

Appropriate infrastructure so recycling is as accessible as possible, and awareness of which materials are recyclable for proper sorting of waste are also key elements of a circular economy. Waste sorting at the source make the processing of recyclables much easier and more cost-efficient as it offers easy access to clean materials.

In the EU, the European Green Deal which includes the Circular Economy Action Plan sets out the policies for adopting a circular economy.

Shifting to a Circular Economy will help break the association of economic growth to environmental destruction and shows that the former is possible while preserving the environment. In business, it offers the possibilities for new opportunities as well as new employment opportunities. For consumers, this means higher quality and safe products paired with a new range of services.


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