Circular Economy in Europe

Does Europe really need to transition toward a circular economy?

Undoubtedly, the massive burden that the linear economic model poses on the ecosystem has been a fundamental factor in the development of the circular economy proposition, urged by a steady and significant increase of the demand for raw materials and exacerbated by the growing evidence of a changing climate.

Natural resources represent the core of the global economy,  standing at the base of the current production patterns: these are in fact extracted, traded, processed, distributed, consumed and finally wasted or emitted. Therefore, the transition toward a circular economy must secure the essential need for raw materials, at a global level. 

For the last 20 years, global extraction rates have been regularly increasing (+ 3.2% per year), also due to the expanding demand of the developing and transitioning countries. 

Moreover, the rise of the middle class in emerging economies is expected to generate additional perils on the already deteriorated environmental and climate conditions. 

According to the International Resource Panel (IRP, launched by the United Nations Environmental Programme) projections, the use of resources will more than double between 2015 and 2060 (190 billion tonnes); while the Organization for Economic Cooperation and Development (OECD) estimates a quadruplication of the global Gross Domestic Product (GDP) in the same time frame (2011-2060).

At the global level, the transfer of the production plants and processes from the districts characterized by high material productivity to those areas having a lower material-use-efficiency generates further obstacles for the reduction in the employment of natural resources. 

But, at the same time, the abovementioned geographical shift of the production has allowed numerous countries to increment their GDP and permitted to a considerable number of individuals to exit poverty by entering the middle class: in fact, OECD estimated that the global expansion of the middle class will almost double from 1.8 billion in 2009 to 3.2 billion in 2020 (4.9 in 2030).

It is thus foreseen, in the upcoming decades, an unprecedented growth of the market for consumer goods, enlarging the basin of households participating in the current linear and wasteful consumption paradigm.

As of now, and even more considering the appraised future scenario, the countries endowed with the highest material living standards, as the European Union, own the responsibility to demonstrate their capabilities to maintain their quality-of-life levels while decreasing their dependency on primary resources. Thus, the transition toward a circular economy represents not only a necessity but also an obligation for Europe, becoming a high priority of its Strategy via the Green Deal and the Circular Economy Action Plan

Even if the circular economy is a global challenge, the achievement of the European Goals can alone benefit the international community, not only due to the possibility of deploying more sustainable trade and commercial standards with its numerous external partners; but more importantly to prove the viability of the circular shift. 

The summed power of the EU multinational companies working throughout global value chains, together with the allure of the possibility to operate in the world greatest consumer market, can represent a substantial incentive and an interesting lever for non-EU companies to convert their business models, converging to European circular and sustainable standards. 

Moreover, the IRP global sustainability scenario elaborated how resource efficiency and circularity can significantly decelerate the rise in resource consumption and decrease environmental pressure while enhancing income and wellbeing indicators. According to the IRP scenario, the transition of already mature economies can offset both the increasing demand for resources and the environmental pressure generated by the developing and transitioning economies

To conclude, it is now our duty, as European, to lead the transition toward the circular economy, deploying our best efforts to achieve the established objective, while trying to encourage our external partners in taking action.

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