Well-regulated and increased cross-border trade is a key enabler to close the global circularity gap. It allows the global transfer of the technologies and services that nations and businesses need to up-scale circular activities such as repair, re-manufacturing and recycling as well as the generation of renewable energy. It also helps ensure the transfer of secondary goods and materials to countries where there is sufficient market demand to reuse these goods and materials, or the necessary expertise and scale to recycle them economically and safely.
In order to achieve this, the global trading system must be overhauled. In addition to a revision of trade standards, rules and regulations, a new generation of technologies must be harnessed. Three specific technological trends are set to have an impact on the role of trade in a just circular transition: (i) increasing supply chain transparency and product life cycle information; (ii) localized material sourcing and manufacturing; and (iii) enhanced product repair and secondary material recovery. If harnessed appropriately, each trend offers significant potential to re-wire global trade in line with circularity. Yet, if these technology trends are used to reinforce the global economy’s current power structure, they could serve to lock in and even accelerate the divide between developed and least developed countries (LDC).
Concerted efforts are therefore necessary to ensure a level playing field through investments in technologies and circular businesses models to create new trade opportunities for LDCs. The aim of this invitation only workshop is to bring together trade, finance and circular economy experts to explore the role of finance in creating a level playing field for circular economy-oriented trade.
Dr Jack Barrie, Research Fellow, Chatham House
Alessandra Lepore, Coordinator, SWITCH Asia