What is missing from the development of the circular economy. Reports
There is no unifying policy that can lead to the goal of adopting the circular economy as a new production model. What the Iceps report says. The intervention of Alessandra Servidori
Without any claim to completeness, our interinstitutional associative group ICEPS (Italian platform of actors for the circular economy) has drawn up a report that brings together numerous support measures that can be directly or indirectly linked to the development of the circular economy, both at EU and national level.
The report has a twofold objective. The first is to describe the existing economic tools designed to facilitate the circular transition. The second is to highlight some critical issues which, if overcome, could make their use more efficient in order to promote circularity.
CIRCULAR ECONOMY: AN INCORRECT PICTURE
The impression that this review gives us, however, is not of a coherent picture. As in the game of Shanghai, the elements are all there, but in disorder and confused: there is no unifying basic policy that can lead towards the goal of adopting circularity as a new model of production and consumption; and this appears more true in particular if national measures are analysed.
This leads to some reflections. The first reflection is that it seems that the circular economy has not yet been understood in its real innovative and synergistic scope with respect to the other challenges of the ecological and digital transition. On the one hand, even in programmatic documents, the circular economy is associated with other areas (e.g. in the PNRR together with sustainable agriculture, in the BTP GREEN with pollution prevention and control) as if to signal a lack of dignity of an area to be promoted as such, also in light of the few funds allocated. On the other hand, a growing number of analyzes reveal the added value of circular economy practices also for the fight against climate change and the loss of biodiversity, as well as employment opportunities and active community involvement: but also from this point of view there is little movement of resources to stimulate a structural change in this sense.
The second reflection is therefore precisely that on specific resources – and not generic ones, i.e. allocated in the framework of measures aimed at supporting sustainability – intended for the study and implementation of circular economy solutions and, if possible, bio-circular. In fact, for a concrete grounding, inter-functional aspects must be studied along all the value chains of the different economic activities. In other words, it must emerge that it is essential not only to pay attention, according to a traditional vision, to the final part of the supply chain, that relating to the end of life and waste management, but rather to set up a strategy that reasons upstream and in a systemic way, through instruments suitable for promoting, for example, eco-design, the reuse of packaging and the extended responsibility of the producer.
THE CIRCULAR ECONOMY IS A STRATEGIC AND INDUSTRIAL LEVER
The circular economy is therefore still seen as something to solve an environmental problem rather than as a strategic lever of industrial and commercial policy. In this sense, the SNEC seems to be taking a step forward, but with excessive timidity, setting too dilated time objectives also for incentives and economic measures that should be implemented very quickly and which are only partially included in the time schedule.
The urgent and substantial resources required by the circular transition must then be accompanied by the creation of a monitoring system of the measures that goes beyond the statistics on the allocations and provides other indicators of the effectiveness of the policies implemented. It is necessary to integrate only the ex ante evaluation with ex post evaluations, to verify the success of a measure and, if necessary, implement corrections in order to make it more effective. This is, for example, the case with the provision in favor of the sale of draft or bulk products, an opportunity that is only minimally seized and which could give greater results if associated with a more suitable information campaign.
THE PLASTIC TAX
A further consideration concerns the delayed adoption of some tools that appear to be without contraindications (no regret). This is the case of some tools such as the security deposit or the plastic tax, which however cannot do without the support of IT tools to regulate the system and make it transparent, through standardized forms of certification recognized by third party and institutional bodies which ensure the absence of perverse and negative effects on other spheres of sustainability (human health, environment in the broadest sense, etc.). If undertaken, it is easy to foresee their function as a stimulus to adopt virtuous behaviors on the part of consumers, who would thus feel even more protagonists of change through changes in their preferences towards circular and sustainable consumption processes and product choices. This also passes through incentives for shared forms of consumption (sharing) and oriented towards the purchase of the service rather than the product (pay-per use, renting/leasing).
Resources can be of various kinds and it is certainly essential to provide for a coherent system of tools and incentives. The ultimate goal must be to stimulate innovation and create a competitive market, to make circular processes and products the most economically convenient choice for both businesses and households.
THE COMPETITIVENESS
As regards the competitiveness of circular products, this also requires the creation of the rules and conditions underlying an efficient market for secondary raw materials for the various supply chains and materials, overcoming the existing regulatory, economic and technical obstacles (see the recent report by the European Environment Agency Investigating Europe's secondary raw material markets ).
As far as investments are concerned, the commitment in favor of initiatives undertaken, with a multiplicity of instruments, by credit institutes should be welcomed. Cooperation between the private and public sectors is the right key to mobilize economic, human and technological resources towards shared objectives. However, the allocation of funds still remains marginal compared to the potential needs of the business system and should be further encouraged, as it is strategic to support companies to correctly represent their sustainability profile in general and in particular their level of adherence to the circular economy paradigm as well as the transition plans they would like to see financed which must be credible and oriented towards the objectives established by the legislator and the best practices in use.
Surely the proposal of new criteria for investments also in areas not covered so far by the EU taxonomy for sustainable finance, including the circular economy, could be instrumental for this purpose68 . In fact, financial actors are and will be increasingly encouraged to report their financial support both to activities that are already sustainable in themselves (sustainable finance in the strict sense) and to those that have a plan to approach sustainability ("transition" finance).
Not to be underestimated, in addition to the transition plans, are the so-called "remediation" plans, aimed at overcoming non-sustainability problems, such as for example the presence of elements that do not allow compliance with the criteria of not causing significant damage envisaged by the Taxonomy.
For all of the above in terms of investments, collaboration between financial and non-financial players is essential. In particular, for SMEs the role of the representatives of the various production categories is fundamental, even at the local level, as they are probably in the best position to identify concrete circular economy paths for the productive fabric they represent.
However, the working group places some hopes in the ongoing Community provisions relating to packaging and eco-design as well as in the timely application of the SNEC timetable, because after these new bodies of legislation it will be difficult to escape the definition of a coherent industrial policy that adopts circularity as one of the fundamental trump cards for sustainable development and for the adoption of new and more competitive business models.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/circular-economy/icesp-rapporto-economia-circolare/ on Mon, 24 Jul 2023 13:22:39 +0000.