A report from Chatham house warns that insufficient attention has been paid to the circular economy (CE) pathways in developing countries, despite considerable innovation and policy progress.

The report, however, notes that The CE offers an alternative strategy for industrial development and job creation to the traditional manufacturing-led growth pathway. Making the point that the CE is often understood primarily as a waste management and recycling strategy, the report highlights that the economic opportunities are far broader and more diverse – offering new opportunities for economic diversification, value creation and skills development.

Developing countries are also in a strong position to do this, with informal sectors already practising ‘circular’ activities in areas such as electronic waste (e-waste) and phone repairs. Moreover, with enough investment, developing countries could ‘leapfrog’ developed countries in digital and materials innovation to embed sustainable production and consumption at the heart of their economies.

The report recognises there may be trade-offs in the significant shifts in industrial policy, with the example of resource-intensive economies supporting current employment.

The report states that EU and China, as global CE ‘front-runners’, should commit to deeper dialogues with developing countries and global trade bodies should spearhead the development of common standards for internationally traded waste and secondary materials.

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