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EU could raise billions from circular economy

January 23, 2017

(Copyright: Slaters Electrical Ltd.)


If the EU implemented the circular economy it could create €320 billion ($343 billion).

Sustainable Brands reported that research shows the “business case” for circular economy is strong, and this was backed up by a report from the Business and Sustainable Development Commission, which stated that “sustainable business models [were] the key to unlocking trillions of dollars in economic opportunities”. In the UK, WRAP, a circular economy organisation, showed how brands had saved themselves £100 million ($124/€116 million) just by “reducing food waste”.

A recent report from the Ellen MacArthur Foundation called Achieving Growth Within identified top investments that could deliver a “major source of regenerative growth and unlock economic, social and environmental benefits”, as well as justifying the risks involved, and that businesses and governments could greatly benefit.

Dame Ellen MacArthur, Founder of the Ellen MacArthur Foundation, said: “Building on the analysis of our 2015 Growth Within, which demonstrated the additional €900 billion ($965 billion) benefit for Europe by 2030 from shifting to circular economy practices, this latest report outlines the first steps needed by businesses and governments to realise these benefits. As our current linear growth model becomes increasingly challenged, this research shows how Europe can begin to exploit new opportunities for innovation, growth and resilience, gradually decoupled from resource constraints.”

The article noted that this would have huge benefits for “European households, society and the environment”, and should be a “top priority for European governments” that appear to be stuck in a stagnant and under-invested era. Achieving Growth Within recognises top investments which by 2025 would generate an extra seven percent growth in GDP, “reduce raw material consumption by an additional 10 percent and produce 17 percent annual lower CO2 emissions, compared with the current development path”.

Three of these top investments are the transport, food and building development industries, earning €135 billion ($144 billion), €70 billion ($75 billion) and €115 billion ($123 billion) respectively, and resulting in zero-emission cars with reusable and remanufactured parts, as well as regenerating soil and ecosystems and designing reusable energy producing buildings with non-toxic materials.

The report said that “business leaders must act quickly to take advantage of the ‘first mover’ opportunities within the 10 investment themes, in parallel with scaling back investments at risk of becoming ‘stranded’”, and that policy makers in the EU and Europe need to take action to set a policy framework for clear direction that removes “barriers” and enables cooperation and innovation.

Dr Martin R. Stuchtey added: “In our study we asked a very fundamental question: what would it take to make Europe attractive to industrial investors? With the help of 50 plus experts from the private and public sector, we found that the potential for growth is high and the risk of stranded assets is low. We found these investment themes across the mobility system, food system and the built environment.

“Each of them looks very different versus traditional linear investment themes: they are not investments purely in new technology or new products — rather in new systems and require a new investment approach altogether.”

The launch of the report comes with a “design thinking guide”, and comprises “24 methods as well as video interviews with designers, worksheets and case study links” for the circular economy. The guide addresses “complex circular challenges such as re-thinking global plastics flows” and acts as a “central neutral resource on how to design for the circular economy”. Those taking part in the New Plastics Economy initiative are already developing and redesigning plastic packaging as well as the systems that will enable its reuse or recycling afterwards.


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