“There’s a really interesting element to the risks of the current system – they’ve traditionally been underplayed. But actually these risks from the linear economy, the sort of global challenges that we’re seeing (such as climate change, biodiversity loss, pollution, waste) – those are real economic risks as well.
In Episode 5, Miranda Schnitger (Ellen MacArthur Foundation), Nilgun Tas (United Nations Industrial Development Organization) and Paula Iharur (CTplas – Plastics Technology Centre) provide the answers.
Watch Episode 5 on YouTube (with Captions)!
Chapters
3:07: Miranda Schnitger
16:52: Nilgun Tas
31:51: Paula Iharur
Transcript
[Teaser]
Miranda Schnitger: There’s a really interesting element to the risks of the current system, have traditionally been underplayed. But actually these risks from the linear economy, the sort of global challenges that we’re seeing – those are real economic risks as well.
Colm Hastings: Welcome to The Green Renaissance, a podcast series from the Partnership for Action on Green Economy that aims to unpack the green recovery debate. This month, the switch from lines to circles. With COVID-19 highlighting the wastefulness of our current economic model, how do we embrace circularity as part of a green recovery? First, Miranda Schnitger. Governments Lead at the Ellen MacArthur Foundation.
Miranda Schnitger: So it goes beyond looking at what we can do within the current system to minimize our impact, but actually takes a sort of structural reform lens, and thinks about how could we redesign our economy differently, so that we are delivering economic development and value. But at the same time also we’re creating solutions to these global challenges.
Colm Hastings: Next, Nilgun Tas. Deputy Director of the Department of Environment at the United Nations Industrial Development Organization.
Nilgun Tas: We have to ask how to change our behaviours, so that products and materials – and their value – is available to create additional economic returns, and conserve natural resources.
Colm Hastings: And finally, Paula Iharur. General Coordinator of CTplas – the Plastics Technology Centre in Uruguay.
Paula Iharur: What is our relationship with material things? What are our material needs? And what is it that we are leaving behind when we reduce our consumption and move towards a more circular economy?
Colm Hastings: Subscribe on SoundCloud, Spotify or wherever you get your podcasts. I’m Colm Hastings, and this is The Green Renaissance.
[Intro]
Colm Hastings: For centuries our economies have been built around a fairly simple model. In order to produce a good, we would typically start by taking something from nature. If that good was a chair, we might take some wood from a tree. We would make the chair and then one day, maybe years down the line when it was no longer useful, we might throw it away. In recent decades, this model has been put on fast forward. Today, we purposefully make goods to last for a limited amount of time. Think of everything you own – your phone, your clothes, even the food you eat. Each time we take from nature, we make something, and we throw it away.
Colm Hastings: Take, make, dispose, repeat. Those four words underpin everything that we do in our daily lives, and it’s certainly making a select group of people very rich. But at what cost to everyone else, and our planet? Meeting the demands of a growing population, within a linear take-make-dispose economic model, will simply mean more taking, and more wasting. How much further are we willing to push our luck? We’re already overshooting our planet’s natural carrying capacities, with predictable effects for the environment and human health.
Colm Hastings: So the key question for our guests this month is – how do we break away from our dominant linear model, towards one that retains and regenerates value? What are the steps that governments, industry, business and indeed we can take, to advance circularity as part of a green recovery? First we speak to Miranda Schnitger, who is the Governments Lead at the Ellen MacArthur Foundation – a UK-based charity that is committed to developing and promoting a circular economy. Miranda leads an initiative developing a set of universally relevant circular economy policy goals through which the circular economy can scale, and here she explains what those goals are and why they are now more needed and relevant than ever.
[Interviews]
Miranda Schnitger: The way we see the system currently, it’s really a linear economy. And by that I mean, we’re extracting resources, we’re turning them into goods and products, and then unfortunately we’re wasting them. Which means money is left on the table and we’re also creating ever larger problems for ourselves so, untenable environmental degradation, climate change, biodiversity loss, and of course pollution. So for us the circular economy really represents a systemic shift. So it goes beyond looking at what we can do within the current system, to minimize our impact, but actually takes a structural reform lens, and thinks about how could we redesign our economy differently, so that we are delivering economic development and value, but at the same time also we’re creating solutions to these global challenges.
Miranda Schnitger: So that’s really what the essence of the circular economy is about and I think that relates to your question about, you know, why are we talking about this now. And it’s based on three principles, so – eliminate waste and pollution, keep products and materials in use, and regenerate natural capital. Each one of those we can get to by design. And that then comes on to why we’ve created the circular economy framework, the policy goals. Because it’s really about taking those three principles, and translating them into five goals where policy makers can really focus, to deliver up the enabling conditions for the rest of us.
Miranda Schnitger: So to run through the five goals. There’s Goal 1 and 2, which I really see as a pair. The first one is stimulate design for the circular economy, and the second one is manage resources to preserve value. The first has a real upstream opportunity. Upstream is really a word looking at the start of the system. So when we’re looking at bringing materials onto the market, products onto the market, designing a system. What are the opportunities there for policy makers to encourage us to design those things in line with the circular economy?
Miranda Schnitger: And then Goal 2, managing resources and preserving value. Once all of these things are on our market, how do we keep them in use? How do we preserve their value? So those two together really create a material flow, but that’s not enough. If we just do those two, we will get somewhere, but there are so many other incentives in the economy that are pointing and are hard-wired for the linear economy, because that’s what we’ve been designing and perfecting for a really long time.
Miranda Schnitger: So Goal 3 looks at how can we set the conditions, for the economics to work at scale? How do we make the economics work? And there’s a whole raft of measures that can support that, that will inform how materials are priced, that create markets and that inform the decisions that businesses and consumers will then take. In conjunction with that there’s Goal 4, which is about investment. It will be no surprise, but investment is a really important part – public investment and private investment – and we really need to see the investments in infrastructure, and innovation and skills. All of those bits of investment that are happening – are they also in line with the circular economy? Will they help us to get to scale or will they actually just deliver more of the same?
Miranda Schnitger: And then the final goal, which I really have to say is not the last goal to get to – they’re not numbered in a, do 1, then 2, then 3, then 4. The final goal, Goal 5 is sort of the underlying goal that underpins all the rest, and really recognizes that no one actor can do it alone. So this goes back to where I started a little bit about saying, policymakers have a really big role to play, but they cannot do it alone. And that’s actually the same for each actor in the system. Because we’re taking a systemic lens, and because this is about innovation, the public and the private sector, and the inclusion of the broader public in this, is a really important part. So collaboration for that system change, is absolutely fundamental.
Colm Hastings: I guess starting with the, well you’ve spoken about the need for a collaborative approach. And starting with the first stakeholder group would be governments. I guess it’s fair to say that the circular economy is a concept that’s been around for quite a long time now. We’ve had the same discussions about the green economy, and how that has been pushed for quite a long time, but still hasn’t really broken through in so many ways. So what are some of the challenges or barriers that have maybe been preventing that from happening? And how do we look to overcome these now?
Miranda Schnitger: It’s really interesting with the circular economy, because as you say, elements of the concept have been around for a long time. But there is still, I think, a really big opportunity around building a common understanding. Sometimes circular economy, it sort of first enters one’s thinking when one’s thinking about waste management. There is a tendency for it sometimes to be very much linked to recycling, and certainly we do need to improve collection, re-sorting and recycling infrastructure in order to support materials circulate.
Miranda Schnitger: But that slightly misses out on this much bigger and exciting area of the upstream opportunity. How do we think about redesigning products, services and systems? Because the decisions that we make right at the start will inform if something can be recycled, but also whether it might not need to be recycled. It could also then enter a model which is more about reuse, or it could be much easier to re-manufacture it, to refurbish it. If we’re talking about buildings, maybe it could be disassembled so that elements could be then reused again. If we’re talking about agriculture and food, we could switch to a regenerative agricultural system. It could be thinking actually about how we develop cities or urban planning, or how we build eco-parks and industrial symbiosis opportunities.
Miranda Schnitger: In terms of implementing the goals, I think there’s a real opportunity to take a whole of government approach and collaboration to this. Often it starts in an environment ministry, and they have a really important role to play in this. Resource management questions often sit in in those ministries. But there’s also industrial policies that can incentivize businesses, what funds are available to businesses. The conditions under which they are operating, so business and industry ministries can play a really big part in this. Similarly, the incentives that are created through tax subsidies, broader investment opportunities. That can often sit with economics and finance ministries. Transport, infrastructure, that all comes into play. So too does education. So education ministries need to be aware of this. So I think that there’s a real opportunity to, with the broader understanding, also take a whole of government approach.
Miranda Schnitger: And you do see some of this happening, this isn’t all theory. There are circular economy roadmaps in development, and also efforts to embed circular economy across different policies. So just to touch on that very briefly, our own research around climate change found that 45% of greenhouse gas emissions come from the way we manage and make food and other products. Those emissions, that 45% of the whole picture – we’re not going to be able to tackle those purely through the energy transition or purely through energy efficiency measures.
Miranda Schnitger: We’re going to have to rethink and take new approaches to how we produce and consume. So the circular economy is perfectly positioned to provide solutions there. So that’s what I mean about integrating circular economy into other areas of policy. For example, plans to address climate change, or plans to address biodiversity. The IRP has found that 90% of biodiversity and water stress is coming from the way we extract materials and use them, so huge opportunities there.
Miranda Schnitger: And then the other one is collaboration across different stakeholder groups. I see that as a big third opportunity area. Businesses, finance, citizens – like I said, there’s no one actor that can do it alone. And actually this is really what Goal 5 is getting at. So how can we build inclusive roadmaps? Sitra is an organization that’s worked with the Finnish government on sort of mapping out how they did their roadmap, and in that they found that the process of an inclusive road map is just as important as the outcomes of developing a vision together, because then everyone’s bought into it and driving in the same direction.
Colm Hastings: It’s interesting, it’s very similar to infrastructure I think, and sustainable infrastructure which I worked on before. Where the more you looked into it, the more it kind of touched on and underpinned every single other aspect of the environment, of society, where you can really make an impact in so many different ways. But I guess that’s also the challenge in terms of bringing all of these different people together, and then bringing them all together in the same direction.
Miranda Schnitger: I think that’s a reflection of it being about the economy, actually. That it’s a sort of new approach to it. And you mentioned, infrastructure. I mean, it’s a great example of one area where you can apply the principles to infrastructure in terms of how it’s designed, how we finance it. So very much that making of infrastructure, how does the circular economy apply to that. But then also infrastructure, as you say, is an enabler. So if we have the right infrastructure in place, other things can happen.
Miranda Schnitger: So for example, in cities, some cities are looking at how do you think about the design of cities by area? So the idea of like a 15 minute city, for example. How do you build the infrastructure up so that it’s more possible to do things locally, which can then also encourage that exchange factor to happen more easily? Convenience is such a big part of informing what we do so I think the whole question of like urban planning, the infrastructure that goes into that, can really enable other parts of the circular economy to take off.
Colm Hastings: Building on that, another stakeholder group that you spoke to a bit just there that I also wanted to speak about is business. Obviously they will have a quite a big role to play in this transition as well. I think it’s fair to say that they don’t always share the same objectives or motives as perhaps governments sometimes do. So how do we incentivize business to engage in the circular economy transition? Is regulation the answer? Is it the fact that I guess, reputational risks are being much more relevant and important these days. What types of factors are needed to inspire business?
Miranda Schnitger: Right, so the economic opportunity is a really important part of the circular economy and it’s where our whole focus started actually. We did studies on the opportunity in Europe and India and China, and in each one of them we found that there was a real business opportunity to be had. In Europe, the Growth Within study found that there was a €1.8 trillion opportunity per annum by 2030. The studies looking at China and India across three or five sectors, found similar trajectories. So when you mention like, why would business get involved in this? The first answer is because it is an economic opportunity.
Miranda Schnitger: It’s also an innovation opportunity, and I think that’s a really big driver in business. You need both there to be an economic rationale for this, but also these opportunities to open new markets, potentially build a longer-lasting and a different relationship with customers. You did touch on sort of an external call for things like this, and I think that is true that there are more people who are looking for organizations of all sorts to sort of show the purpose and the contribution that they make to society. So I think there is an element of that. But first of all I would go back to the point about this is actually an economic opportunity, so that’s number one.
Miranda Schnitger: And in our work we see actually that business, finance and policymakers have some of the strongest leadership roles in this, because they are the ones that can inform the upstream opportunities that I’ve mentioned earlier. Policy can set the conditions as to saying what you can put on the market, what substances you can and can’t use. It can set outcome targets. Business then actually does that bit, and then finance is so important because of course finance is needed to bring some of these things into existence.
Miranda Schnitger: And also there’s a really interesting element to the risks of the current system, have traditionally been underplayed. But actually these risks from the linear economy that I mentioned earlier, the sort of global challenges that we’re seeing. Those are real economic risks as well. And so the finance system is increasingly looking at the circular economy. In 2017, one of our studies found that they weren’t really very many funds looking at circular economy, and there are at least 10 now I think, possibly more because that figure is from last year. But all those actors are now focusing on the circular economy.
Colm Hastings: Speaking of the pandemic more generally, has the response over the past few months made you more or less hopeful that the world is going to make the necessary steps in the right direction?
Miranda Schnitger: I’m optimistic about the direction. I think one needs to be actually, because there’s a big challenge ahead of us. But the reason why I’m saying that I’m optimistic is I think there’s been an incredible awareness, actually, of there is a need for us to rethink the way we do certain things that has come through in the pandemic.
Miranda Schnitger: I’m also optimistic because more things around the circular economy have actually continued to happen. Whilst governments were obviously extremely busy with managing the crisis, particularly in its height, there are new elements of circular economy, sort of collaborations, alliances that are being formed, roadmaps are being developed or continued to be developed during the pandemic.
Miranda Schnitger: So for example this February, the Global Alliance for Resource Efficiency and Circular Economy launched. Also recently, the Latin American and Caribbean Circular Economy Coalition launched. So to the African Circular Economy Alliance has gone a step further in formalizing its existence. The European Commission already had a circular economy action plan and that’s at the heart of its European Green Deal. That all came out before the pandemic, but it’s very much at the heart of moving forward from here.
Miranda Schnitger: On the business side, one of the things that we do at the Foundation is not just develop the idea of the circular economy, but also work with a large number of stakeholders in order to try and bring about this transformation. We have an initiative around plastic packaging. We have more than 1000 companies and organisations signed up to a common vision around a circular economy for plastic packaging. And that commitment has remained in place. There have been challenges as a result of the pandemic, but the intent to drive towards that goal is still there and growing.
Miranda Schnitger: So I think that’s really optimistic and on the example of plastic packaging, if we just think about how in the last few years there’s been a shift of sort of talking about the issue of plastics, to moving towards thinking about how we can tackle it, to even getting to the stage where there’s a discussion about whether there will be a global treaty on how we manage the issue of plastic packaging, bringing in that whole opportunity and potential of international coordination around it. That’s an incredible trajectory that’s happened actually over a comparatively short period of time when we think about shifts in the policy space. These things make me optimistic.
Miranda Schnitger: And then a last example I would say is also some of the innovation that we saw from businesses during the pandemic. The ability to pivot, the need to collaborate across the value chain, to also recognize the importance of local value chains and what that can bring. There were signs in all of these things that fit very well with how a circular economy would operate. So I am optimistic about where we can go. I’m not diminishing the size of the challenge ahead of us, it is very significant. But I think the opportunity and the potential that circular economy can bring to all of these things. I think the understanding of that has grown a little bit, and hopefully will continue to grow from here as we move forward and try and address the climate change and biodiversity challenges that we face.
Colm Hastings: Next we speak to Nilgün Tas, who is Deputy Director of the Department of Environment and Chief of the Industrial Resource Efficiency Division at the United Nations Industrial Development Organization. Nilgün leads the organization’s work to promote green industry development through resource efficiency and circular economy, and here she discusses why the circular economy aligns with and advances the green recovery agenda.
Nilgun Tas: I’m sure you’ve heard of the Earth being compared to a raft or a spaceship traveling through space. George Orwell used Henry George’s 1879 analogy in his 1937 novel, and Kenneth Boulding, an economist, talked about the economics of becoming Spaceship Earth in 1966. These foretold a future where we all had to act as spacemen on a spaceship – consuming limited resources, and polluting limited reservoirs.
Nilgun Tas: So for a very long time, we knew we had to decouple our well-being and economic growth, from consumption of natural resources. Have we really been spaceman on a spaceship? Not at all I think. Our economies, the jobs and income created depend on the production and consumption of products, which we then dispose in landfills or send for incineration – a huge loss of economic value.
Nilgun Tas: Everything we consume contains a physical good that is produced, processed or manufactured from materials. It may be biomass such as beans, meat and wood. Or a material like metal, while fossil fuels are also materials used in production. Manufacturing requires use of water. It happens on a piece of land which may have been diverted from its natural state as a forest, and production might be polluting the land with wastewater, chemicals and the air with greenhouse gases. Have we, as consumers been better? A lot of plastic products and packaging get tossed into the rubbish bins, and end up in landfills then in our waterways as pollution, and forever lose all value.
Nilgun Tas: We have to ask how to change our behaviours, so that products and materials – and their value – is available to create additional economic returns, and conserve natural resources.
Colm Hastings: In terms of really advancing the circular economy, and implementing it. I read a UNIDO paper that was published a few years ago, which stated that the building blocks of a circular economy do not need to be invented, they already exist. And I think that’s been a common theme throughout our series actually so far, that even with regards to the green recovery and other policy areas, it’s not a case of reinventing the wheel – the policies, the tools, the solutions, they already exist and are ready to be taken up. So I guess returning to my question, what would you say are the building blocks for a circular economy, and should countries perhaps prioritize certain blocks over others?
Nilgun Tas: A circular economy would also be a green economy because it is about transforming our economies to achieve environmental, social and economic benefits all at once. At UNIDO we describe an economy that operates on the principles of designing out waste and pollution, keeping products and materials in use as long as possible, regenerating natural systems, and shifting towards the use of renewable energy as circular. These principles are intuitive, and they build on experience and good practices we already know about.
Nilgun Tas: Back in 1979, Ad Lansing – a Dutch politician – proposed the waste hierarchy and the best option as being waste prevention, which of course one can only achieve by design. With Agenda 21, cleaner production methods for waste and pollution prevention, were adopted by governments in policies, and by businesses in practices. By now, tens of thousands of firms around the world benefit from resource efficient and cleaner production applications. There are 65 Resource Efficient and Cleaner Production Centres we have been supporting since 1994, and they continue independently to churn out similar economic, environmental and social benefits, by helping SMEs adopt greener and more circular technologies.
Nilgun Tas: For instance, few people know that one kilogram of cotton garments consumes three kilograms of chemicals. There is much potential for decreasing chemicals and water use, for reducing wastewater, and costs in fashion value chains. Businesses can achieve this by what we call chemical leasing, which is a product as service, or performance-based business model. One Colombian textile manufacturer alone saved 63% of chemicals, 27% of additives, and US$ 150,000 per year.
Nilgun Tas: Government policies enable these practices. In Vietnam, industrial parks can now concentrate on being more circular by becoming an eco-industrial park. A government decree now defines the requirement to be recognized as “eco-” and to receive related incentives. There are I’m very happy to say also plans to support renewable energy investment, including for eco-industrial parks, in the recovery plans of Vietnam.
Colm Hastings: I think it’s still fair to say that there is a lot of work that still remains to be done. I know that the COVID-19 pandemic has brought up new challenges. I mean, for example, the production and use of single use gloves, masks, other personal protective equipment. I think I read this morning that the world collectively uses 3,000,000 disposable paper masks each and every second, which is a number that’s hard to get your head around I think. And all of these have often been produced within I guess a dominant, embedded take-make-dispose economic model. So what challenges do countries face in departing from this model?
Nilgun Tas: Despite the existing building blocks for circularity, there are indeed challenges. Everyone has to get on board – globally, within a country, in a region, in a city, in firms and as a consumer. During my childhood, my mother whose hobby was sewing, would make skirts and dresses for me from her old ones. I have to admit that I found a few t-shirts and a pair of shoes only worn a few times – they looked as new – when doing my spring cleaning a few weeks ago. Quite embarrassing for me, because I consider myself more frugal.
Nilgun Tas: We need to consume less and vote with our purses to demand more circular products, to help create markets for them, and teach our children, grandchildren to understand the irreparable damage, pollution and disease, unsustainable consumption causes. According to a Lancet study of 2017, which we as UNIDO also sponsored, every year air, soil and water pollution kills an incredible 9 million people, mostly in low- and middle-income countries, and results in huge welfare losses of an estimated US$ 4.6 trillion a year.
Nilgun Tas: In spite of these losses, developing economies are still more circular than advanced economies, but they want to produce their own goods. Because inclusive and sustainable industrialization and innovation creates higher-skilled, more durable, better paying and decent jobs, and improves well-being of societies. Populations in these economies want nutritious and clean food, clean water in lakes, rivers and oceans, sustainable infrastructure, housing, mobility – and to safeguard their ecosystems.
Nilgun Tas: A first challenge is awareness and understanding of the full scope of circular economy, and relating it with what we now already know. Circularity is not only about better waste management – it’s about the shift to circular products by design, so that they are durable, non-toxic, and efficient during use, can be maintained, upgraded, repaired easily, or reused, repurposed, remanufactured, and recycled or regenerated if biomass space.
Nilgun Tas: A second challenge is deciding where to start a circular economy transition. We advise governments and businesses to start in a few areas where there are low-hanging fruits. For instance, in textiles, plastics, electronics, food – all known to constitute significant portions of waste to prevent, and use as a resource.
Nilgun Tas: Finally, there is lack of regulation that will induce all stakeholders to become more circular. In every economy, small and medium enterprises, SMEs, feed parts and products into global, regional or domestic value chains. But they have to produce to the specification of buyers. Unless circularity is fully embraced along value chains, and for example by global buyers, their suppliers and other value chain actors would not have an incentive to change even if they wanted to. There is a need for regulations.
Colm Hastings: I think one other theme that has emerged in our discussions throughout this series is the need for more collaboration, alliances, partnerships between different stakeholder groups. And why is this especially the case for the circular economy? Does this also relate to the need for a shared or common vision between these different stakeholder groups? And how is UNIDO working to support a global circular economy agenda?
Nilgun Tas: Let me give the example of what is happening in the area of refrigeration and air conditioning products globally. These products contain ozone depleting substances, we call them ODS in short, which have much larger global warming potential, ranging from about 2,500 to 12,000 times higher than that of CO2. Designing refrigerators and installation foams that contain less harmful substances, and converting coal production lines so that these products no longer contain ODS, is about designing waste and pollution out of our economies.
Nilgun Tas: UNIDO has helped eradicate over a third of these dangerous chemicals from the developing world, equivalent to a year’s CO2 emissions from over 100 coal-fired power plants. New technologies adopted in these activities are more efficient, thereby resulting in additional decreases in CO2 emissions. In 2019, over 10,000 people globally, received training organized by UNIDO in refrigeration, servicing, maintenance and installation, creating a skilled workforce for keeping refrigeration equipment in use as long as possible.
Nilgun Tas: How does all this happen? These activities are supported by a global consensus on targets, bans, and phaseout initiatives for ODS under the Montreal Protocol. Costs essential and additional to the elimination and use and production of ODS, through investments into non-ODS containing technologies, are funded by the Multilateral Fund, and ensure that these transitions are undertaken. Predictable and consistent funding is critical to success. At national levels, these activities receive the necessary cooperation, partnerships and coordination from both the public and private sectors. This shows how important it is to have horizontal structures that will facilitate cooperation, partnerships, and most importantly, policy coordination.
Nilgun Tas: UNIDO is supporting this through various platforms. Our 170 Member States are engaged in consultations and exchanges on best practices, to help industries adopt circular economy principles and practices, for achieving the high-priority ambition of developing countries for inclusive and sustainable industrialization, innovation and resilient infrastructure, as in SDG 9. And for moving towards low carbon and climate-resilient and neutral economies to reach SDG 13 – while contributing to almost all other SDGs.
Nilgun Tas: The other global initiative we are supporting, together with the European Union and UNEP, is the Global Alliance on Circular Economy and Resource Efficiency – shortly called GACERE. Currently, the benefits of circular economy are not well linked to climate change, biodiversity and pollution agendas.
Nilgun Tas: Climate change discussions mostly focus on one part of the equation – energy transitions. Even if we implemented all energy efficiency measures possible everywhere, and shifted 100% to renewable energy, we would only be able to tackle 55% of the climate challenge. As GACERE, we aim to establish these links by advocating for a global just transition to circular economy, to contribute to the Paris Agreement Goals, halt and reverse biodiversity loss, and curb pollution and waste.
Colm Hastings: I think then, just as a final question. You’ve obviously spoken about the various building blocks for a circular economy. You’ve spoken about the need for coordination, collaboration, and a shared vision, a shared agenda. So just to go back to the country level, are there any particularly progressive policy innovations, approaches, best practices that we can look to around the world for inspiration?
Nilgun Tas: An eco-company of an Asia-based office equipment manufacturer is able to disassemble office machines into eighty – 8-0 – different types of recyclable streams, because each part is made only of one type of metal or plastic. This is also a labour-intensive circular economy activity, which creates decent jobs. They also use some durable parts and components that are in good condition, in refurbished office equipment, or in remanufactured equipment that comes with the exact same warranty of a new machine. Everyone benefits – economically, socially, and environmentally.
Nilgun Tas: In the circular economy policy area, of course the European Union leads the way. Circular economy is in the heart of their new Green Deal and their green industrial strategy, and is tightly linked to their goals for climate neutrality, biodiversity and pollution actions. The UK government has mandated, for example, every firm – including those in the financial sector – to report on their environmental and social materiality, in addition to financial materiality, by 2025. This is going to ensure that investments will take into account financial, environmental, and social risks, and costs.
Nilgun Tas: In Latin America, almost all countries are implementing, experimenting with or planning circular economy transitions. They have also established the Latin American and Caribbean Circular Economy Coalition, with which as UNIDO we also engage with, and GACERE also plans to invite their representatives to GACERE platforms.
Nilgun Tas: Finally in Africa, Rwanda, South Africa, and Nigeria have founded the Africa Circular Economy Alliance, and Ghana and Cote d’Ivoire have joined with Niger, Senegal, Malawi, Cameroon and the Democratic Republic of Congo having expressed interest. I am absolutely excited with all these developments, and looking forward to the new normal – that is a global circular economy for the future.
Colm Hastings: And finally we speak to Paula Iharur. Paula is the General Coordinator of CTplas – the Plastics Technology Centre in Uruguay. CTplas aims to consolidate the sustainable development of the Uruguayan plastic industry, and Paula leads the organization’s work in its role as a public-private articulator – promoting innovation processes in the plastic value network. Here she begins by outlining the business case for a circular economy transition.
Paula Iharur: What it seems to me that we are missing, and what is needed as part of the “business case”, is what we call an “extra turn of the screw” – which means adding the human dimension.
Paula Iharur: And by this, I mean that the circular economy paradigm challenges us, but it challenges us as a society and as human beings. And although in these talks we have a very strong focus on the role of organizations, the state and the international community, it seems to me that the challenge is to begin to incorporate this human dimension. Because the circular economy paradigm challenges us as a society and as human beings, in the sense that it is inviting us to leave behind a form of consumption that has defined us and our societies for years. And I speak here from a place of privilege let’s say, where we have somehow grown, understood and located ourselves in this world of being and ‘consuming’.
Paula Iharur: And the circular economy now invites us to question this ‘consuming’, and to be able to somehow question ourselves or generate a cultural change that implies repositioning this ‘consuming’. And to ask what consumerism really means, above all? So, it seems to me that for the “business case”, and in order for us to be able to make a leap forwards, it’s necessary to start incorporating our relationship as consumers into society.
Paula Iharur: We need to pay much more attention to how we can start working with these consumption patterns, and to be able to visualise those things that we need to leave behind. And this means, without going into too much detail, to ask what is our relationship with material things? What are our material needs? And what is it that we are leaving behind when we reduce our consumption and move towards a more circular economy?
Paula Iharur: I think it’s therefore urgent and necessary to start incorporating interdisciplinary models that can begin to consider this question from the point of the human being and from the link that we have with society. This review of our human needs is very profound, and I may have gone off in a direction that was not expected. But it’s because I understand that while the transition is underway, and that efforts are being made by States and the private and public sectors, there is still a lot to be done. And I think for this to really have “flesh”, we need to start building a more multidisciplinary vision that seeks to understand the needs of the consumer.
Colm Hastings: If you’re speaking there about the need for a shared vision, a shared circular economy vision, it’s perhaps fair to say that the environmental sustainability movement has shown that over the years the interests and needs of governments, businesses, industries, consumers are not always aligned. Sometimes they have very different interests, very different needs. So I guess, a) what would this shared vision look like, and how would it be achieved? How would we get all of those different stakeholders together on the same page, to create and implement this shared vision?
Paula Iharur: I believe that a shared vision is there, and that we are all agreed on it. But in some ways, this vision is unsustainable. I understand that we are in a very complex world – that reality is very complex, and that there are political, economic and social interests that work to undermine this shared vision. And as these interests undoubtedly change, this also impacts our shared vision of the circular economy.
Paula Iharur: Because when we define or say that we have to meet certain goals, or when we regulate through laws – for example with plastics – these laws are in some way restricting our field of action. But we also have to take care of jobs. We have to look at how economic activity is contributing to the country. We have to look at the technical side – in this case, the fact that plastic materials contribute to other production chains.
Paula Iharur: So, we can make decisions that we understand are designed to make these systems more sustainable, and to reduce the damage that we are doing to the planet. But we also have to take into account the economic reality, the social reality, and the political reality of countries – indeed the reality of all of the stakeholders that are involved.
Paula Iharur: So, I think that this shared vision is that this material way that we have of being on planet earth is becoming less and less sustainable. But it also implies – and this in a way is our beacon of light, directing us to where we have to go – not knowing or recognising the reality of each one of us, of the countries and each of the industries that are affected by this situation. So, it’s fundamental to have this knowledge, as a beacon to show us where we have to go.
Colm Hastings: I guess as a next question, you’ve spoken just there about some of the challenges for business as well to transition to a circular economy. One immediate challenge that businesses are still facing is the impacts and effects of COVID-19. Do you think this has de-prioritized perhaps for some businesses the goals or objectives of circularity or sustainability? Has this become less important for businesses now, or is it still on their agenda?
Paula Iharur: I think that the COVID crisis, and the urgency of the situation, helped us understand the importance of partnerships. Firstly, the importance of partnerships, and the need for synergies between the different organizations and actors within society. To be able to interact fluidly and quickly, in order to provide answers. We were able to provide those rapid responses, because the COVID crisis and the urgency of the situation required us to.
Paula Iharur: The second point is that in the case of CTplas, it was possible to see the importance of leveraging existing capacities. For all of our work, we were able to call on both the technicians of LATU, the Technological Laboratory of Uruguay, and the inter-institutional work of the Chamber of Industries. Mapping and understanding the landscape and capacities of businesses was also fundamental, including the particular industry sector, and we were able to do so through working with the Chamber of Industries, Uruguayan Association of Plastics Industries, and academia.
Paula Iharur: So, in a way, the COVID crisis – and this interaction between different actors – served as a training ground for providing rapid, accurate and correct responses to a complex situation. That path had to be learned very quickly, and importantly required capacity for an inter-institutional response. This included working together with the public sector, which certainly boosted and created fertile ground for making these.
Paula Iharur: Then in many ways it was also like an accelerated trial of what I believe needs to happen with the circular economy. The capacities or the capacity to implement the circular economy, or the path that we will have to take, is already there – because the COVID crisis served as a trial of the need to articulate, to complement, and to generate an inter-institutional governance, and to understand where we had to go or to agree that this was the right way forward.
Paula Iharur: But the crisis was also useful for recognising the different actors, and the contribution of the different actors that will be needed and able to take up the challenge that the circular economy proposes. So, this implies starting from the foundation of knowledge that already exists and being able to find new ways of linking up, new fields of work, new spaces in which to work and importantly new businesses for the private sector.
Colm Hastings: I also wanted to talk to you a little bit about some of the work that your organization does in the plastic sector in Uruguay. I understand that it was an award winner at the Uruguay Circularity Awards last year. Could you talk about some of the work that CT Plas has done to promote a circular economy in Uruguay, and can some of this work be scaled or replicated in other sectors – not just in the plastic sector, but also beyond Uruguay, maybe in other countries in Latin America?
Paula Iharur: CTplas is a public-private initiative, with five institutions that have been working together since 2015. They are the Uruguayan Association of Plastics Industries, the Chamber of Industries, The Technological Laboratory of Uruguay, the Julio Ricaldoni Foundation of the Faculty of Engineering at the University of the Republic, and since 2015 we have been co-financed by the National Agency for Innovation and Research.
Paula Iharur: So, we began operating in 2015, and it was from then that we began to implement our model – starting from the point of sectoral demand. From there, we identify and validate the specific services that the sector needs.
Paula Iharur: In 2013, the issue of recycling – not the circular economy – was one of the demands that the plastics sector put on the table, and that we began to work on – alongside providing other services such as training, technology and innovation. Then through the National Development Agency, we started to focus more on the circular economy and have now developed a certification called +Circular.
Paula Iharur: The aim of this certification is to improve the competitiveness of the plastics sector in Uruguay and its recycling chain. In 2018, we trained companies in everything that the circular economy entails, including showing how the sector could get up to speed on these issues, what challenges they faced, and what barriers were preventing the sector from overcoming these.
Paula Iharur: +Circular itself is a process and product certification, but it seeks – through our understanding of the sector, as well as its opportunities and shortcomings – to work on improving the company’s preparation to face the challenges the circular economy is going to impose.
Paula Iharur: Now we are working on a fifth axis, which is also supported by the National Development Agency – and this is eco-design. Through this we are aiming to apply a skill to a sector that has taken a real beating in terms of public opinion, and also hit hard by regulation, in order to generate inputs and some form of recognition for those companies that have been working positively in this direction.
Paula Iharur: This experience can certainly be very easily replicated in other sectors. Because it is simply an exercise of bringing together a technical vision, an academic vision, and a very strong sectoral knowledge – which has only been achieved by working with the technicians at LATU, at the Chamber of Industries, and at the University.
Paula Iharur: And this means understanding precisely what the demands of the sector are, where these begin to clash with the challenges proposed by the circular economy, and to then prepare the company for what is going to come.
[Outro]
Colm Hastings: That was The Green Renaissance. Please subscribe on SoundCloud, Spotify and wherever you get your podcasts to receive new episodes each month. Also, don’t forget to give us a rating if you enjoy the series, as the more ratings we get, the more people will be able to discover us. In the meantime, if you’d like to learn more about the Partnership for Action on Green Economy, the PAGE 2020 Annual Report has now been released. This highlights the Partnership’s ongoing work in supporting inclusive green economy transitions within its twenty partner countries, and you can visit www.un-page.org to check it out. Thank you for listening, and until next time.