Overview - Circular economy

Circular economy – Overview


Illustration of circular economy - © Bup / Shutterstock.com

What is the circular economy about?

A circular economy aims to maintain the value of products, materials and resources for as long as possible by returning them into the product cycle at the end of their use, while minimising the generation of waste. The fewer products we discard, the less materials we extract, the better for our environment.

This process starts at the very beginning of a product’s lifecycle: smart product design and production processes can help save resources, avoid inefficient waste management and create new business opportunities.

What are the benefits?

The circular economy offers an opportunity to reinvent our economy, making it more sustainable and competitive. This brings benefits for European businesses, industries, and citizens such as:

  • more innovative and efficient ways of producing and consuming;
  • protection for businesses against scarcity of resources and volatile prices;
  • opportunities for local jobs and social integration;
  • optimisation of waste management which boosts recycling and reduces landfill;
  • energy savings as less production processes requires less energy;
  • benefits for the environment in terms of climate and biodiversity, air, soil and water pollution.

What is the European Commission doing and what is Eurostat's role?

Action on the circular economy ties in closely with key EU policy priorities and with global efforts on sustainable development.

In 2015, the European Commission adopted an ambitious 'Circular Economy Package'. An EU Action Plan for the circular economy establishes a concrete programme of actions outlining measures that cover the entire product life cycle: from production and consumption to waste management and the market for secondary raw materials. On 4 March 2019, the European Commission adopted a comprehensive report on the implementation of the Circular Economy Action Plan.

On 11 March 2020, the European Commission adopted a new Circular Economy Action Plan – one of the main building blocks of the European Green Deal, Europe’s new agenda for sustainable growth. The new Action Plan announces initiatives along the entire life cycle of products, targeting for example their design, promoting circular economy processes, fostering sustainable consumption, and aiming to ensure that the resources used are kept in the EU economy for as long as possible. It introduces legislative and non-legislative measures targeting areas where action at the EU level brings real added value..

In addition, the circular economy has strong synergies with the EU’s objectives on climate and energy and with the Commission’s package on 'Clean Energy for all Europeans'. The circular economy is also instrumental in supporting the EU’s commitments on sustainability, as outlined in the Communication ‘Next steps for a sustainable European future’ and in particular to reach Sustainable Development Goal 12 'Responsible consumption and production'.

Eurostat's role is to provide easy access to the relevant data for citizens and policy makers in order to support the monitoring progress. Monitoring allows the European Commission and other policy makers to keep track of the progress made and assess the effectiveness of their actions. It also provides a clear signal to economic actors such as business and consumers on ongoing trends.

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