The Circular Economy Strategy: What goes around, comes around

The European Commission’s ambitious Circular Economy strategy is laudable. But it must not throw the baby out with the bathwater.

22 Aug 2015

Using limited resources more efficiently can bring net savings for EU businesses.

This makes the Commission’s decision to introduce a new, more ambitious Circular Economy strategy later this year very welcome. With the public consultation phase now closed, we can look forward to work continuing apace.

However, any it is vitally important that any proposed strategy fully aligns with existing priorities, including EU growth and job objectives, internal market principles as well as the Energy Union.

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A number of industry sectors, particularly in manufacturing, are understandably concerned over how the implementation of any strategy will roll out.

They worry that using broad-brush measures will not take account of the complexities of the vast numbers of products and supply chain demands involved.

Handled incorrectly, this could become a brake on investment, innovation and growth. European companies, including many SMEs, will have to come to terms with regulations that may not reflect their product or circumstances in their sectors.

A second concern is the apparent policy focus on municipal waste. For many stakeholders, packaging is synonymous with waste, yet municipal waste represents only 10 per cent of all waste generated in Europe.

The reality is much more complex; any potential broad-brush measures must be complemented with specific sector approaches.

Products and their packaging cannot be treated separately; the function and design of the packaging is largely determined by the demands of the product and supply chain.

It needs to reflect myriad needs; product protection, shelf-life, food waste prevention and the demands of distribution.

It also needs to meet consumer expectations for safety, convenience and security. The role and design decisions for packaging in all other life-cycle phases are just as important as for the end of life phase.

Another important tool in shaping a Circular Economy is Extended Producer Responsibility (EPR), where a producer’s responsibility for their goods is extended to the post-consumer stage of the product’s life cycle. Yet this also needs careful handling.

EPR is a useful end of life policy tool that helps Member States meet their recycling and recovery targets. A number of stakeholders would like the EU to introduce some binding minimum requirements to strengthen the EPR framework.

Packaging supply chain body EUROPEN (European Organization for Packaging and the Environment) also supports this approach.

It believes that updating the EPR legislative framework at EU and national level will deliver more and better recycling for all packaging, in a way that is more cost-effective and will better balance supply and demand sides of raw material needs.

It would also level the playing field between different models of EPR scheme. This is important, since application of EPR is a national and regional issue.

No one doubts the desirability of moving towards a circular economy, one that is driven by technical and digital approaches, increasing resource efficient business and societal models.

However, it needs to be handled delicately and in such a way that it does not unnecessarily hinder business, innovation and competitiveness. The EU should see this

as the ideal opportunity to consolidate and sharpen the EU regulatory framework, and acknowledge the importance of the Action Plan in addition to the waste legislative proposal.

The Action Plan should allow existing policy options mature and assess their impact first. That will allow for a better-designed, less disruptive transition to a Circular Economy.

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