Covid-19 and the circular economy: opportunities and reflections
In light of the covid-19 pandemic, how could the circular economy shape a more resilient, socially just and environmentally safe world?
This article was written by Laxmi Haigh and Lena Bäunker, with valued input and ideation from the wider Circle Economy team
This blog is part of a series of reflections on covid-19 and the circular economy. For previous blogs in the series, please see here.
The circular economy has depths of potential. In allowing us to collectively reimagine and redesign our systems through the lens of resource use, it encourages us to think about how our needs and wants might be satisfied within planetary boundaries. Under the collective experience of the covid-19 pandemic, there has never been a more salient time to consider how the circular economy could be translated into reality — a new normal — when economies begin to pick up again. The crisis has exposed weak points in the dominant linear model; entrenched inequality, climate breakdown and inherent fragility. It also continues to amplify the interconnectedness of all humans across the globe and the interdependencies binding our natural, social and economic systems. We are only as strong as our most vulnerable citizens.
As a team, we stand in solidarity with everyone affected by the pandemic and come together — digitally — to reflect on the current global upheaval. Normally nestled in our office in the centre of Amsterdam, our staff continues to connect from their homes to lament, as well as envision with a more analytical eye how this global turbulence could shape our future.
We see that the current linear system is failing both people and planet. Business as usual depletes our natural world, increases social inequality and threatens our future on earth. And now, in light of the covid-19 pandemic, the interlinkages between these challenges and the scale of the problem have never been more apparent.
‘This is an unprecedented opportunity to move away from unmitigated growth at all costs and the old fossil fuel economy, and deliver a lasting balance between people, prosperity and our planetary boundaries,’ said the Planetary Emergency Partnership in a call to action to global leaders published by the Club of Rome in March.
Short-term environmental relief
What role could the circular economy have in mitigating climate breakdown?
The swift slowdown of daily life in the face of covid-19 disruption — such as reduced vehicle use and power plant activity — has resulted in some positive environmental impacts. We’ve witnessed reduced greenhouse gas emissions and improvements in air quality, for example. But environmental relief during this period is no guarantee of long-term change. Underlying frameworks need to be reassessed. Proponents of a circular economy have long warned of the unsustainable nature of the dominant “take-make-waste” model which is the bread and butter of most economies. Today, only 8.6% of extracted resources are reused or cycled. We extract at a faster rate than our world can regenerate. Despite health systems struggling under the strain of the pandemic, experts predict that climate breakdown — not covid-19 — will be the “biggest global health threat” of the century. Increasingly, parallels are being drawn between the pandemic and climate breakdown as both exposing an economy that is not future-proof.
In prioritising resource efficiency and resilience, the circular economy and the climate mitigation agenda are inextricably linked and mutually reinforcing. The Paris Agreement has largely guided international emission reduction goals so far, but the commitments made by 195 countries are not yet sufficient to stay on a 2 °C trajectory, let alone a 1.5 °C pathway. And now, international cooperation and national climate policies are only beginning to recognise the essential role of circular strategies in achieving the 45% reduction in greenhouse gas emissions that cannot be reached by shifting to renewables alone. Economies that are more circular and resource-efficient will see long-term reduced greenhouse gas emissions along value chains; from logistics and manufacturing, to the mines where raw materials are sourced.
Award-winning science journalist Sonia Shah describes how microbes, such as those behind covid-19, can rapidly spread among human populations due to overcrowding, urbanisation and our destruction of natural habitats. This includes the expansion of arable agricultural land through deforestation and the use of chemical fertilisers. In contrast, in circular agriculture models nutrient cycles are closed with farmers. Animal-based fertilisers and their own crop remnants are used to nourish soil, for example; negating the need for chemical fertilisers.
Inequality among communities and countries
How could the circular economy lead to a socially just and inclusive space?
In a matter of weeks we have observed the rapid deployment of urgent measures to contain the virus. This has demonstrated the capability of both governments and populations in promptly adapting their policies and behaviours — almost overnight. Indeed, this is the nature of emergencies; they fast-forward processes and decisions that could normally ‘take years of deliberation’. The responses to covid-19 have, however, further exposed inequality between and within communities and countries. Measures that aim to ‘flatten the curve’ — such as social distancing — deployed in Europe, the US and China could devastate lower-income countries and communities.
For millions of people around the world, preventing the spread of the disease by washing hands in clean water or working online from home is not possible due to a lack of infrastructure; and health care may be inadequate, too expensive or too far away. For many workers and entrepreneurs, the entire option of paid work has been removed, and there are no savings to fall back on. Governments are scrambling to provide support and fiscal benefits to vulnerable groups particularly hard-hit by the situation. But short-term fixes don’t adequately address entrenched inequality and many countries cannot afford the scale of support required.
According to a Chatham House report published this month, the circular economy has the potential ‘to reduce existing tensions and struggles around resource conflicts and unequal distribution of resources’ through participatory forms of governance, which involve local stakeholders in the management of resources. Closed-loop value chains that transform waste into resources, for example, not only reduce pollution but can simultaneously pursue social objectives. In Bangladesh — a country now struck by millions of job losses — the Ella Pad initiative turns textiles waste into hygiene products for women and supports female entrepreneurship. Moreover, the dumping of production surplus has become a norm in linear systems and has been exacerbated by the covid-19 pandemic due to border restrictions and lockdowns. But this surplus material can be recovered and directed towards local communities. The South Africa-based Food Forward initiative recovers edible food surplus from the consumer goods supply chain and redistributes it to local community organisations. In this case, loops are closed and those in need receive nourishment.
By steering innovation towards reaching public goals over private ones, the circular economy could contribute to the creation of stronger communities and sustainable livelihoods.
A fragile economic system
How could the circular economy craft a more resilient economy?
The remarkable situation we are now in has exposed the fragility of the dominant economic model to prepare for and respond to crisis and shocks. The economic impact of the pandemic is severe and growth prospects remain uncertain. The disruption has severed various global supply and production chains, many of which are increasingly international and complex, contributing now to their vulnerability. This has directly impacted unemployment — potentially 195 million job losses — and increased the risk of food insecurity for millions. If we “muddle through” each new crisis with the same economic model that got us here, albeit with short-term fixes to abate the impact, future shocks will continue to exceed capacities.
The current crippling of the “growth-addicted” global economy has highlighted the need for long-term, risk-reduction and sustainable fiscal thinking; pivoting away from the current focus on delivering profits and infinite growth. Indeed, an economy guided by the notion of resilience (defined as having the capacity to absorb shocks so to maintain essential functions) and built on circularity can be instrumental in creating a sustainable model that prioritises reliability over growth. This would have a positive and overarching impact on social, cultural, economic and environmental sustainability, according to a Stockholm Resilience Centre report. The report calls on multi-layered systems, such as the EU, and national governments to collaborate with different stakeholders to transform the economy through radical innovation in economic policy, corporate strategy and in social systems and governance. With resilience thinking as a guide, all innovation stemming from circular thinking would go beyond focusing on boosting the market and competitiveness, and place the overall well-being of citizens as an equal goal, for example.
Indeed, inspiration can be taken from models and frameworks being deployed globally that are already guiding policymakers and governments away from growth-addicted systems. The municipality of Amsterdam has translated Kate Raworth’s global Doughnut model into a municipal level guide for policy. Its central premise is to satisfy the core needs of all within the means of the planet. Meanwhile, many avenues for circular change that can be a means to an end are neatly packaged in the recently launched European Green Deal and Circular Economy Action Plan. The European Council has noted the role of the green transition as part of an as-yet-unwritten ‘comprehensive recovery plan’. As we look toward recovery, it becomes ever more apparent that social, environmental and economic sustainability are interwoven.
Here we have presented a small selection of takeaways from our moments of team reflection. As the crisis continues to unfold and its impacts become clearer, we will constantly revisit this story and continue to publish our observations.
We further invite our readers, partners, stakeholders and like-minded organisations to share with us your questions, thoughts and ideas. We will be using the hashtag #circularpostcovid to share our thoughts, questions and ideas around the subject and invite you to do the same. Through the lens of our consolidated insights, we will identify practical and scalable solutions that help to navigate a post-pandemic transition towards a safe and just world.
If all the world’s a stage, now is the time to retrain the actors, adapt the script and rewrite the story.