The Circular Economy and the Global South

Sustainable Lifestyles and Green Industrial Development

Patrick Schröder, Manisha Anantharaman, Kartika Anggraeni, Timothy J. Foxon, Patrick Schröder, Manisha Anantharaman, Kartika Anggraeni, Timothy J. Foxon

• Publisher: Routledge
• Year: 2019
• Print ISBN: 9781138358928
• eBook ISBN: 9780429783685
• Topic: Economics
• Subtopic: Environmental Economics
• Index: Economics

The circular economy is a policy approach and business strategy that aims to improve resource productivity, promote sustainable consumption and production and reduce environmental impacts. This book examines the relevance of the circular economy in the context of developing countries, something which to date is little understood.

This volume highlights examples of circular economy practices in developing country contexts in relation to small and medium enterprises (SMEs), informal sector recycling and national policy approaches. It examines a broad range of case studies, including Argentina, Brazil, China, Colombia, India, Indonesia, Kenya, South Africa, and Thailand, and illustrates how the circular economy can be used as a new lens and possible solution to cross-cutting development issues of pollution and waste, employment, health, urbanisation and green industrialisation. In addition to more technical and policy oriented contributions, the book also critically discusses existing narratives and pathways of the circular economy in the global North and South, and how these differ or possibly even conflict with each other. Finally, the book critically examines under what conditions the circular economy will be able to reduce global inequalities and promote human development in the context of the Sustainable Development Goals.

Presenting a unique social sciences perspective on the circular economy discourse, this book is relevant to students and scholars studying sustainability in economics, business studies, environmental politics and development studies.

PART I

Introduction

1

Introduction

Sustainable lifestyles, livelihoods and the circular economy

Patrick Schröder, Manisha Anantharaman, Kartika Anggraeni, Timothy J. Foxon and Jeffrey Barber

Circular economy: a new approach for sustainable development?

Overlapping concepts and domains

In this book we address three separate yet overlapping thematic concepts and domains of knowledge, practice and discourse: sustainable lifestyles, livelihoods and the circular economy. Each of these concepts offers contributions to the overall transition to sustainable production and consumption systems and better lives for all. Common to these different concepts is the desire to provide for human needs and improve the quality of life while reducing social and environmental harm and creating pathways to sustainability (Leach, Scoones and Stirling, 2007).

The concept of circular economy (CE) focuses on a set of principles that offer an operational vision of concrete paths to sustainable production and consumption systems and thus to a sustainable economy. The CE approach highlights the importance of changing the current linear model into a system that is regenerative and restorative by design (Ellen MacArthur Foundation, 2015). This can be achieved by redirecting energy and material flows from a linear to a circular direction, transforming waste into productive inputs, and reducing pollution, greenhouse gases and their impacts on health and environment. This involves systems thinking approaches that include changes in value systems, ambitious policies to internalise externalised costs, and new approaches to production, distribution, consumption and investment within each sector of the economy (Stahel, 2016).

Lifestyles is a term used to describe the behavioural codes and cognitive frames enabling decision-making for actions and choices consistent with one’s social identity and role within a particular community. This includes roles as consumers of products and services, producers (i.e. workers, managers, shareholders, service providers) and investors. Lifestyles are increasingly complex given that people tend to belong and identify with not one but a cluster of communities. Lifestyles are considered more or less sustainable to the degree that the actions and choices associated with different roles and identities are guided by sustainability values (Leiserowitz, Kates and Parris, 2006).

Livelihoods, in turn, shape lifestyles in relation to the roles people play in acquiring the means of living, whether as construction workers, farmers, professors, managers or artists. The concept of sustainable livelihoods relates to a wide set of issues that encompass the relationships between poverty and environment (Chambers and Conway, 1992). This includes concerns with work and employment, poverty reduction, broader issues of adequacy, security, well-being and capability, and the resilience of livelihoods and the natural resource base on which they depend (Scoones, 1998; Scoones 2015).

The following sections discuss each of these three concepts in more detail, and explore how they relate to each other.

Circular economy definitions– unity in diversity

The circular economy is today a term that means different things to different people. There is a wide range of circular economy thought-schools, including those who associate the term with cradle-to-cradle design, industrial ecology, performance economy, regenerative design and even biomimicry. The roots of the concept of ‘circular economy’ go back to classical political economists (e.g. Ricardo, Smith, Quesnay) who saw the system of production and consumption as a circular process which ‘stands in striking contrast to the view presented by modern theory, of a one-way avenue that leads from “factors of production” to “consumption goods”’ (Sraffa, 1960:93). Others cite Kenneth Boulding’s 1966 paper ‘The economics of the coming spaceship earth’ or more recently the work of David Pearce and Kerry Turner (1990) as antecedents of the term. Moving beyond strict adherence to neoclassical economic precepts, CE has been described as a framework for re-designing the economy by the Ellen MacArthur Foundation, which has been championing the concept globally since 2010 (Ellen MacArthur Foundation, 2015).

According to this contemporary school of thought, the CE concept is grounded in the study of non-linear, particularly living systems (Webster, 2017) and refers to an industrial economy that is restorative by design and relies on renewable energy, minimises, tracks, and hopefully eliminates the use of toxic chemicals, and eradicates waste through careful design. Imitating living systems, the CE approach works to optimise systems rather than components (i.e. ‘design-to-fit’). This is done through attention to material and energy flows, which according to McDonough and Braungart (2002) can be classified into two kinds: biological nutrients, useful to the biosphere, and technical nutrients, useful to the technosphere, i.e. the systems of industrial production. These definitions of a CE are based on a synthesis of ideas and concepts such as ‘cradle to cradle’ (McDonough and Braungart, 2002), biomimicry (Benyus, 1997) and the performance/sharing economy (Stahel, 2016), and include insights from industrial ecology. A recent definition by Geissdoerfer et al. (2017), who view the CE as a potential new sustainability paradigm, summarise the main elements of the CE as ‘a regenerative system in which resource input and waste, emission, and energy leakage are minimised by slowing, closing, and narrowing material and energy loops. This can be achieved through long-lasting design, maintenance, repair, reuse, remanufacturing, refurbishing, and recycling.’

Overall, there is little consensus and convergence on the definition of the circular economy, and current definitions have a number of limitations (Homrich et al., 2018). Despite the breadth of the concept and related practices of the circular economy, it is becoming increasingly popular among policymakers. Circularity has been adopted as national policy by China in 2009 (see Chapter 8 of this book) and Finland in 2016. The Netherlands adopted a government-wide programme aimed at developing a circular economy in the Netherlands by 2050. According to the Netherlands Environmental Assessment Agency, the approach of making optimal use of raw materials and resources contrasts with the currently dominant linear economy that operates on a ‘take-make-dispose’ logic, assuming access to unlimited resources and thereby producing products to be discarded after use. A circular economy, on the other hand, ‘centres around the reuse of products and raw materials, and the prevention of waste and harmful emissions to soils, water and air, wherever possible’, thus closing the loop (PBL, 2017).

In 2015 the European Commission adopted the circular economy concept as part of the EU’s 2020 strategy initiative ‘to modernise and transform the European economy, shifting it towards a more sustainable direction’ (EC, 2015). According to the EU,

The transition to a more circular economy, where the value of products, materials and resources is maintained in the economy for as long as possible, and the generation of waste minimised, is an essential contribution to the EU’s efforts to develop a sustainable, low carbon, resource efficient and competitive economy. Such transition is the opportunity to transform our economy and generate new and sustainable competitive advantages for Europe.

In support of the transition to a circular economy, the EU package includes legislative proposals on waste, with long-term targets to reduce landfilling and increase recycling and reuse. In closing the loop of product lifecycles, the package includes ‘an Action Plan to support the circular economy in each step of the value chain– from production to consumption, repair and manufacturing, waste management and secondary raw materials that are fed back into the economy’ (EC, 2015).

While there is much excitement about the promise of CE, in assessing the potential for and transition pathways from a linear to a CE, it is important to acknowledge the different capacities, opportunities and pressures at different levels and stages of the process. As Potting et al. (2017) point out,

the actual circular economy transition should lead to closing cycles at the level of individual products, i.e. in the related product chains. The transition process may differ across products and between circularity strategies, where lower circularity strategies are still closer to a linear economy and higher circularity strategies are closer to the circular economy.

Technological innovation, they note, is mainly relevant for lower circularity strategies, whereas

socio-institutional changes become more important for higher circularity strategies increasingly involve transforming the whole product chain (i.e. systemic changes). Socio-institutional changes refer to differences in how consumers relate to products, how all actors in a product chain cooperate to achieve circularity, and all institutional arrangements needed to facilitate this.

Further, researchers have argued that proponents of the circular economy could learn from the social and solidarity economy, as well as from institutional economics, by embedding the CE in relations of power, more explicit value systems and solidarity principles (Moreau et al., 2017). Towards this end, more consideration could be given to the institutional conditions necessary for setting rules that differentiate profitable from non-profitable activities in a circular economy, and guaranteeing high labour standards. Additionally, questions remain as to whether the circular economic model should contribute to ‘alternatives to growth’, i.e. a sharing rather than for-profit model involving changes to both production and consumption patterns, or simply to an alternative model of growth which would only involve changing forms of production and business models.

Circular economy in the context of green transformations

Despite the limitations, different goals and ongoing conceptual development within the circular economy, there seems to be consensus that the circular economy has, potentially, much to offer in augmenting existing efforts at environmental sustainability and solving global environmental challenges.

Conceptually, in this book, we approach the circular economy through the lens of green transformations, a particular type of thinking about and conceptualising transformations which is primarily concerned with environmental sustainability, but also highlights issues of contested politics and the social dimensions of negotiating pathways. The perspective of green transformations is about ‘involving more diverse, emergent and unruly political alignments, more about social innovations, challenging incumbent structures, subject to incommensurable knowledges and pursuing contending (even unknown) end’ (Scoones et al, 2015:54). A green transformations perspective emphasises that there is no consensus on the ‘drivers’ of environmental stress, whether that be overconsumption or rapid urbanisation processes, and even less consensus on the required solutions and processes of change. Simply put, ‘a clear vision of what green transformations are required, for what and for whom remains elusive’ (Scoones et al., 2015:5).

Furthermore, the green transformations lens highlights the existence of a number of narratives, each reflecting different and sometimes competing framings of environmental problem and solution, and therefore different versions of sustainability. These different narratives also appear in the transformations from a linear system of production and consumption to a circular economy. Research about the circular economy shows that there exist different pathways towards more circularity (Homrich et al., 2017). As we discussed earlier, the concept itself is contested, with several definitions bandied about. Some scholarship on the circular economy aims to achieve consensus about the concept, main principles and approaches (Prieto-Sandoval, Jaca and Ormazabal, 2018). However, we argue that it is not clear if these existing pathways will converge into one main circular economy approach or if they might instead further diverge into multiple pathways characterised by different practices and processes. As Scoones et al. (2015) have pointed out, green transformations will be achieved through a combination of pathways and there is no one-size-fits-all approach, so a diversity of political strategies will be required. In the spirit of the green transformations literature, this book seeks to document the diversity of meanings and practices associated with the circular economy, focusing specifically on the developing world.

Having presented an overview of the history and contemporary understanding of the circular economy and highlighted some of the contestation around what the term means and how it is enacted in practice, the next section discusses the circular economy in relation to narratives around economic development and economic growth.

Economic development narratives and the circular economy

The circular economy focuses on the creation and retention of value associated with natural resources and manufactured products by enhancing circular flows aimed at regenerating and restoring this value. This is usually interpreted as economic value, so that increasing the circularity of flows would enable greater economic value to be created whilst minimising environmental impacts associated with the extraction of natural resources and the emission of wastes. As argued by the Ellen MacArthur Foundation (2015), ‘In a circular economy, improving the value captured from existing products and materials, not just increasing their flow, would increasingly drive economic growth’. This is to be achieved by:

• Preserving and enhancing natural capital by controlling finite stocks and balancing renewable resource flows;
• Optimising resource yields by circulating products, components, and materials at the highest utility;
• Fostering system effectiveness by revealing and designing out negative externalities.

Similarly, the EU Action Plan for the Circular Economy emphasises that the maintenance of value of products, materials and resources in the economy for as long as possible is ‘an essential contribution to the EU’s efforts to develop a sustainable, low carbon, resource efficient and competitive economy’ (EC, 2015). Thus, the CE is usually understood in terms of enhancing resource productivity, i.e. the economic value created per unit of resource use, and decoupling economic growth from resource use and environmental impacts.

This means that the CE is usually embedded in a green growth narrative, emphasising new business development and market opportunities, more efficient ways of producing and consuming, and the creation of local jobs. Using a simple economic model, the Ellen MacArthur Foundation (2015) projected that ‘GDP could increase as much as 11 percent by 2030 and 27 percent by 2050 in a circular scenario, compared with 4 percent and 15 percent in the current development scenario’. This is argued to be driven by ‘increased consumption due to correcting market and regu...

Table of contents

• Cover
• Half Title
• Series Page
• Title Page
• Copyright Page
• Table of Contents
• List of illustrations
• List of contributors
• Acknowledgements
• Abbreviations
• Preface
• PART I: Introduction
• PART II: Narratives and politics of waste and the circular economy in the Global South
• PART III: Policy frameworks and green industrial development approaches
• PART IV: Livelihoods and traditional circular economy practices
• PART V: Conclusion and outlook: circular economy approaches for the Sustainable Development Goals
• Index