China and the EU have signed a joint Memorandum of Understanding (MoU) on Circular Economy Cooperation at the 20th EU-China Summit in Beijing on 16 July.
According to the Ellen MacAurthur Foundation, this agreement could pave the way for China and the EU to align key mechanisms and potentially create the building blocks for product standards and policies, which can enable an effective circular economy, for example in the area of plastics. Plastics have been a recent policy priority for both China and the EU as the primary focus of the EU’s circular economy agenda in 2017 and covered by China’s foreign waste import ban in 2017.
“Closer alignment on the circular economy between China and the EU is a significant step, paving the way for a global shift towards an economic system that works for business, people and the environment”, said Dame Ellen MacAurther, Founder of the Ellen MacAurthur Foundation.
Economic benefits of transition to a circular economy
Both China and the EU stand to gain from aligning on policies that support the transition to a circular economy, which can unlock new sources of economic growth and innovation while benefiting people and the environment, for example by reducing pollution and congestion.
The economic benefits of transition to a circular economy in Europe are already well recognised. A 2015 Ellen MacArthur report found that transition to a circular economy could add EUR 0.9 trillion to Europe’s GDP by 2030. Moreover, this would be accompanied by better societal outcomes, including an increase of EUR 3,000 a year in household income, a reduction in the cost of time lost to congestion by 16 percent and a halving of carbon dioxide emissions compared with current levels.
According to the Ellen MacAurthur Foundation, transition to a circular economy in the world’s two largest economies could accelerate adoption of circular economy practices at a global scale, creating potential for a “system shift” towards a low carbon, regenerative economy.
Transition to a circular economy presents China’s cities with significant opportunities
New analysis from the Foundation finds that transition to a circular economy in China’s cities could make goods and services more affordable for citizens and at the same time reduce impacts normally associated with middle class lifestyles, such as traffic congestion and air pollution.
The analysis, which will be published later this year, quantifies the opportunities for urban and industrial innovation that transition to a circular economy could bring, after decades of rapid development and urbanisation.
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“China has long been a pioneer of circular economy policies and practices, and Chinese cities are hubs of circular economy innovation. Transition to a circular economy presents China’s cities with significant opportunities to create new value, economic growth and further drive that innovation, while becoming more liveable for citizens”, said Dame Ellen MacAurther.
Source: The Ellen MacArthur Foundation