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How can we make the circular economy a reality in the region?

A circular economy is an economy that keeps pollution and waste out of the system, maintains products and materials in use, and regenerates natural resources. It promotes resource and energy efficiency, reduces food waste along the whole supply chain, builds sustainable infrastructure, and provides access to basic services, green and decent jobs, supporting a better quality of life for all. Not only is the circular economy central to the achievement of Sustainable Development Goal (SDG) 12 on sustainable production and consumption, it is a horizontal approach supporting progress towards several other SDGs, such as SDG 6 on water, SDG 7 on energy, SDG 11 on sustainable cities, SDG 13 on climate change, SDG 15 on sustainable use of natural resources.

The transition from a linear to a circular model is still at a very early stage. The Circularity Gap Report launched in Davos in January, revealed that today, less than 10% of the global economy is circular. While there is growing momentum towards circular models of production and consumption, many questions remain on how to implement and accelerate the transition.

In the context of the Regional Forum on Sustainable Development for the UNECE region, held in Geneva on 1-2 March 2018, UNECE member States met to report on progress under SDG 12 and discussed challenges and opportunities with a wide range of stakeholders at a round table on the theme “Towards a circular economy: innovation for sustainable value chains”.

National strategies, frameworks and tools to go circular: what is needed

A systemic transition to a circular economy requires cooperation across different policy areas and levels of government: It demands addressing cross-sectoral linkages as well as a multi-stakeholder and partnership approach involving regional and local governments, the private sector, consumers, science and technology actors and the business community.

There are multiple initiatives in the UNECE region that are helping to address these needs.

In Slovenia, the national Partnership for Green Economy is connecting more than 2500 stakeholders, bridging private and public sector to work together to find systemic solutions; in the Netherlands the “Green Deal” to promote green growth has empowered frontrunners and facilitated innovative and voluntary solutions from businesses, NGOs and local governments; in the Czech Republic, the Ministry of Agriculture organizes regular round tables with various governmental agencies,  industry, producers, civil society and food banks to jointly develop and apply food loss strategies at all levels of production and consumption. In Italy, a broad consultation process launched by the government led to a shared platform for defining a National Action Plan on the Circular Economy.

Countries need clear, transparent rules of the game that gradually raise standards. At the same time,  trade-offs need to be addressed. Systems for enforcing those rules and monitoring progress overall are required. This includes removing regulatory barriers within and across countries and phasing out incentives for unsustainable resource use. In the Czech Republic for example, tax incentives, government grants, new regulations and information for consumers that food sold past its best before date is still edible and safe when labeled accordingly has led to a substantial reduction in food loss. As a result, the volume of donations to food banks is expected to increase from 495 tonnes in 2014 to 10,000 tonnes in 2018.

Integrated packages of policy measures, such as fiscal incentives, investments in Research and Development, sustainable public procurement, incentives for innovation along the whole product life-cycle, are also instrumental to drive the necessary changes, including the establishment of new business models and a wider cultural shift. New approaches including the use of blockchain technologies can help make transactions and the monitoring of compliance easier and reliable.

The shift to a circular economy can be facilitated through policies, regulations and approaches to strengthen consumers’ awareness, such as traceability systems for value chains, eco-labelling schemes, sustainability standards, agricultural standards and market surveillance systems. This can help to ensure compliance and enhance consumers’ trust. For example, the project Nordsyn set by the Nordic Cooperation council has led to better cooperation among market surveillance authorities, generating savings of 28 million Euros for an implementation cost of 2 million Euros.  A groundbreaking 2015 French law prohibited supermarkets from throwing away unused food, boosting donations to food banks

Overall, the transition to a circular economy presents a fresh opportunity to create a positive narrative on economic integration and globalization.

Supporting the transition to more sustainable patterns: the role of UNECE

While there is considerable momentum towards more sustainable patterns of production and consumption across the region, significant challenges must be overcome to harness the potential of the shift to a circular economy.

UNECE countries with economies in transition, concerned with swift growth and often dependent on less sustainable activities, will require strong support to achieve SDG 12 and related goals. Even in the most advanced economies of the UNECE region, institutions in charge of ensuring the conformity of products with regulations in force are severely underfunded.

The international community, frontrunner countries in sustainable production and consumption patterns, and the private sector can assist – through policy dialogue, platforms for cooperation fostering knowledge and technology transfer, capacity building and investment – in accelerating the transition to more sustainable practices.

UNECE is assisting economies in transition to help them better connect to regional and global value chains through the organization of policy dialogues for the exchange of best practices and experiences, for example on innovation and public-private partnerships, awareness raising and capacity building.

UNECE is also fostering the wider shift to more sustainable production and consumption models by providing support to improve traceability, trade facilitation and e-business, effective regulatory systems and market surveillance, and is carrying national policy reviews, for example on Innovation for Sustainable Development.

UNECE’s agricultural quality standards, together with a new four-year project on food loss, are helping to ensure that the quality of agricultural produce is kept throughout the entire supply chain. A unique UNECE basic quality standard is currently being developed to ensure the marketing of all safe and edible produce on domestic and international markets.