5. Conclusions
A transition from a linear to a circular economy is essential to address pressing environmental issues such as depletion of natural resources, biodiversity loss, marine plastic pollution and climate change. As the circular economy gains momentum internationally, it is becoming all the more important to align the economic, environmental and social agenda – as has been done in the SDG framework. And with the economy undergoing a systematic transformation from a linear to a circular model, we now have the opportunity make it more inclusive. But this will not happen automatically: it requires additional effort. To enable just circular transitions and ensure that countries and communities are not left behind, a number of factors need to be taken into account:
- The transition to a circular economy will have consequences for how welfare gains are being distributed among countries, firms, workers and consumers. Participatory circular economy roadmap processes, coordinated by governments and involving multiple stakeholder groups, can identify specific policies including social support schemes, and key projects in priority sectors and pilot regions, which can be used to guide a country’s transition towards a circular economy. Implementation will require collaboration between multiple government agencies and stakeholders from industry and civil society.
- Just transition considerations are crucial to making the circular economy work for human development, and to align the circular economy with the SDGs. Without addressing the human elements, the circular economy will not deliver on important social goals such as improved health, decent working conditions, or reduced inequality. One of the overarching objectives of the circular economy transition should be to reduce the pollution burden of the poorest in society, especially communities affected by mismanaged waste and degraded environments in developing countries. This objective is often neglected in the dominant circular economy agenda. Waste management and recycling policies need to involve local stakeholders in planning, negotiation and implementation through partnerships for waste reduction and waste management.
- Support mechanisms will need to be put in place for low- and middle-income countries that are heavily dependent on sectors such as extractives or textile manufacturing, as business opportunities in these sectors are expected to be negatively affected by the transition. Strategies to broaden and diversify their economic activities and business approaches will be necessary. And just transition policies will be critical to ensuring that workers and communities from sectors that are expected to decline are supported during the transition. Policymakers will need to initiate and facilitate participatory approaches to design appropriate industrial circular economy policies.
- Multilateral approaches to trade arrangements can help to address these issues, and there is a potential role for the WTO to make trade in waste and secondary materials more transparent and environmentally sustainable, as well as to reduce social injustices. Initiatives like the WTO’s Aid for Trade could have a role to play in mobilizing resources for developing countries and addressing emerging trade-related impacts of the circular economy. For stakeholders involved in the circular economy – environment and trade alike – it is necessary to coordinate and engage politically on improving the sustainability and fairness of the global trading system for waste, secondary resources and second-hand products.
- Discussions about just transition mechanisms need to move from the national to the international level to address and rectify existing and emerging inequities between countries. New international cooperation programmes dedicated to the circular economy, and potentially a just transition mechanism on a global level, to support low- and middle-income countries that will be affected during the transition to a circular economy, will be necessary to successfully implement the circular economy transition across global value chains. And transparent and accountable institutions will be needed to ensure that just transition funds reach and benefit workers and affected communities.
Despite the challenges that lie ahead, the circular economy has the potential to foster a just transition, and to reduce existing tensions and struggles around resource conflicts and unequal distribution of resources, in particular by reducing the pollution burden on the poor and pre-empting negative impacts on employment. It is critical to put considerations of equity and fairness at the heart of debates about the transition, and to understand the potential for just transitions in order to ensure that transition processes are not disrupted, that potential losers are supported, and that susceptible countries and vulnerable populations are not left behind.