The circular economy has been a controversial issue since the new Commission cancelled the previous 2014 proposals and undertook to issue a new Circular Economy package by the end of 2015.
In response to this, EASAC (the European Academies’ Science Advisory Council) set up a Working Group of scientists and economists to provide inputs from the natural and social sciences to the debate on the principles and objectives of the European Commission’s policy.
EASAC has identified areas where the Commission’s proposals need refinement to strengthen the move towards the circular economy. In particular, there are two major principles which should be given greater emphasis.
1. Firstly, beneficial effects on competitiveness may be vulnerable if the circular economy is applied only within the European Union.
Policy cannot be developed in isolation of the international situation, including the extent to which measures are consistent with existing trade rules (WTO) and new trade agreements currently under negotiation. Given the importance of TTIP negotiations for example, the circular economy concept must be addressed internationally so that circular economy principles which stimulate innovation within the EU are recognised and supported in other trade negotiations. While the UN Sustainable Development Goals are mentioned in the Commission’s proposals, these should not be the only global context for discussing it.
2. Secondly, the persistence of the linear economy is essentially a market failure because current pricing systems do not integrate social and environmental costs.
In a transition to a circular economy, these external costs will need to be introduced at a faster pace and the Commission should strengthen research into the quantification of environmental and social externalities and their incorporation into the pricing system.
Until this failure is remedied, rules and regulatory instruments will need to be carefully designed to respond to rapid changes in technology and its effects on product life cycles. The Commission must pay close attention to consumers and businesses, since more focus on product longevity may face resistance not just from consumers, but also from stakeholders associated with globalised production, trade, media and advertising and committed to the linear model.
“Globally, our environmental footprint is unsustainable. The circular economy may or may not be the answer to all our global woes, but it could be a powerful tool for reducing the adverse interactions between the economy, the environment and its natural resources and to safeguard the well-being of future generations. However, there are significant obstacles and some potential pitfalls which in our view need more attention – especially to ensure international agreements do not undermine Europe’s leadership on this issue.” notes Dr. Michael Norton, Environment Programme Director, EASAC.
You can download the circular economy commentary (PDF) from this link.