Can the Circular Economy Become the New Normal in Cities?

This article, initially published on the OECD Forum Network on June 4th 2021, is part of a series in which OECD experts and thought leaders — from around the world and all parts of society — address the COVID-19 crisis, discussing and developing solutions now and for the future.

COVID-19 has upended modern life. For months, we stopped or changed our travelling, leisure activities and consumption of personal services. While the consequent reduction in greenhouse gas emissions, lower use of primary raw material and changes in consumption preferences may be temporary, the crisis has increased momentum for more lasting positive impacts and increased awareness of the potential for change.

Building on this momentum, governments have been quick to announce green recovery programmes to develop cleaner and safer environments. However, so far only 17% of the total sums allocated to COVID-19 economic recovery plans have been dedicated to environmentally positive measures. Of this share, only around 1% address resource efficiency and waste management.

How can a circular economy help?

By delivering outputs that minimise or mitigate negative environmental impacts, the circular economy can play a key role in improving lives and liveability—especially in cities, where most people live and work. But the circular economy is more than just reusing and recycling. Embracing it means also rethinking notions of ownership and sharing, and shifting from resource efficiency to sufficiency. Take housing as an example, where in addition to using recycled materials this means increasing building utilisation and implementing modular designs to reduce emissions from steel, heating and cooling.

Is this really possible?

Yes! We learnt it from reacting to the COVID-19 pandemic: the crisis showed that change is possible. Many cities and companies adapted their practices and strategies to cope with decreased demand and new economic challenges. For example, Circular Flanders (a partnership of governments, companies, civil society and knowledge community led by the Public Waste Agency of Flanders) found that companies with a higher level of circularity fared better. They were less dependent on imports of raw materials, maintained shorter supply chains and created job opportunities in repairing, maintaining, recycling and reuse, while promoting innovation and strengthening collaborations compared to their traditional, non-circular counterparts.

Local governments implemented policies that existed before the pandemic, but which had previously been unacceptable politically and socially: from the expansion of bike lanes in Medellin, Rotterdam and Seoul, to localising production Paris and creating city food hubs to avoid food waste in Milan and Glasgow. These policies have demonstrated feasibility and success and can drive momentum towards a circular economy. Indeed, in July 2021 G20 countries underscored the key role of cities in promoting, facilitating and enabling the circular economy and committed to support place-based solutions by local governments. In their Environment Communiqué, countries underlined the importance of co-ordination across levels of government and encouraged the implementation of instruments and incentives to support cities advance towards the circular economy.

The COVID-19 pandemic has also taught us lessons about the need to act promptly, while looking aheadThe pandemic required immediate solutions to prevent the spread of the virus, such as the use of masks and gloves. While effective from a health point of view, this led to an increase in the generation of unrecyclable waste. In Ireland, due to the overwhelming quantity of waste generated during the lockdown, the government announced EUR 1 million of funding to tackle illegal dumping attributed to the COVID-19 crisis. In Thailand, the generation of plastic waste increased from 1,500 to 6,300 tons per day due to the increase in food delivery services. The dramatic increase in waste generation prompts a reflection on how long-term impacts should be taken into account when implementing decisions that may have negative effects on human health and the environment, and generate costs for society in the future. For example, eco-design and reusable products could have reduced the amount of waste produced.

The crisis also reminded us of the importance of ensuring a just transition. The OECD Policy note on cities responses to COVID-19 showed that vulnerable groups such as migrants, the poor, women, young people and the elderly were hit hardest, threatening to widen pre-existing inequalities across people and places. Whether circular economy policies in cities will be effectively implemented or not depends on the ability of green recovery packages to tackle critical social challenges and inequalities linked to affordability, access to jobs and local services (water, waste, energy and transport). Failing to address these inequalities will not only hinder the effectiveness of green policies, but also reduce buy-in and participation in the circular economy transition.

So what now?

The question we have to ask now is: “how do we make the transition to a circular economy happen?” A number of outcome-oriented events (Accelerator Sessions) at the World Circular Economy Forum 2021 focused on facilitating the transition. The OECD co-organised the event on Circularity in Cities and Regions: Addressing Global Challenges through Innovative Place-Based Solutions, which took place on 15 September and offered views from city representatives and circular economy experts.

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Head of Unit, Water Governance and Circular Economy at