The circular economy — A pillar of EU economic policy

The circular economy has quickly become a central element of European economic policy. The aim of politicians and businesses is to reduce the use of fossil raw materials through recycling and reuse, and to replace them with renewable alternatives.

The European Commission is currently preparing legislation that aims to step up the recycling of oil-based plastics.

“We are collaborating closely with industry; the Plastics Alliance we have brought together includes representatives from the whole value chain. Their task is to solve the problem of how to increase the recovery, recycling and reuse of plastics in Europe,” explains European Commission Vice-President Jyrki Katainen.

The EU Plastics Strategy is one of the Commission’s initiatives to further the circular economy. According to Katainen, the logic of a functional circular economy is based on market economics; the circular economy will succeed and create growth only when it results in economic gains all along the value chain.

“Through economic incentives and new legislation, we aim to encourage companies to shift their linear business models towards a circular economy. Currently, less than a third of all plastic is collected for recycling, but I believe that the market will change drastically in the near future,” says Katainen.

“The Commission’s goal is to quadruple the capacity for plastic recycling by the year 2030, at which point all plastic packaging entering the EU market will be recyclable or reusable,” he adds.

To date, the EU’s Horizon 2020 research programme has distributed over EUR 250 million in funding for research and development in the various segments of the Plastics Strategy. A further EUR 100 million will be available up to the end of 2020.

The EU follows closely the progress of circular economy
The forest industry also has a central role to play as a contributor to the circular economy. “We want to make the bioeconomy an even more integral component of the circular economy. We can replace fossil raw materials with raw materials derived from biomass, which additionally supports the EU’s climate goals,” Katainen says.

The functionality of the circular economy varies in different EU countries. “We’re monitoring the implementation of the circular economy in the EU with the help of ten indicators. Monitoring is based on data produced by Eurostat. The member countries also have their own indicators. Data collection is important not only for our ability to monitor the enforcement of legislation, but also to determine whether additional legislation is needed.”

Katainen points out that many areas of the policy are new and haven’t yet come into effect. According to legislation passed by the EU, by 2035, no more than 10 percent of household waste can end up in landfills.

“For implementation to be efficient on a national level, we need at least a Europe-wide market for recycled plastic.”

New thoughts on plastic
The EU also aims to create an international market for circular economy products, and the topic has been central to trade negotiations with countries such as China and Japan.

China placed significant restrictions on the import of recyclable raw materials in 2017. As a result, the world market for recyclable materials collapsed. Europe exported only 5.1 million tonnes of plastic waste to China last year — about half of the previous year’s exports.

Katainen understands China’s decision, as the country is facing a major waste problem. The reduction in exports has worsened Europe’s plastic problem, but at the same time, it serves as encouragement for the recycling and reuse of plastics in Europe.

“Hopefully plastic waste won’t be exported to other Asian countries where environmental standards are weaker,” Katainen adds.

The polluting of the oceans has changed the way people think about plastics.

“A large proportion of the rubbish that ends up in the oceans is plastic, and that applies to rubbish from the EU, as well. This creates serious problems for the environment — and human health is affected by microplastics too. Citizens and politicians strongly support changes in legislation, so we have to take advantage of the situation,” he points out.

“The circular economy is also an important component of climate policy. When the legislation is successfully implemented, the EU will function better than before. Replacing fossil raw materials with new materials doesn’t need to mean increasing costs and a lower quality of life – the circular economy can also function as a strong foundation for economic growth.”–a-pillar-of-eu-economic-policy/

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