Home » Circular economy initiatives that make countries in Asia global powerhouses
The shift towards a more restorative and regenerative economy has made select countries in Asia strive to embrace a more attractive way of doing business, such as the circular model. Asian countries have become increasingly aware of the concept of circular economy and its benefits as the demand for goods increases.
A circular economy is a system that focuses on reducing waste and exploiting existing resources to reduce costs and minimize environmental damage. This system benefits all parties involved and can help countries in Asia become more competitive in the global market.
“90% of the resources extracted and consumed do not return to the production cycles but become waste,”stated by the Economist Impact, an online platform tackling sustainability.
The shift into a circular economy
In recent years, countries in Asia have begun to recognize the potential of a sustainable economy. It has been especially evident in China and South Korea, which have all taken steps to build a circular economy.
As one of the largest economies in Asia, the Chinese government has been actively promoting a circular economy since 2009. The Chinese government has implemented various policies and initiatives to increase resource efficiency and encourage sustainable production and consumption.
These policies have included the promotion of green finance, the establishment of green industries, and the introduction of a waste-to-energy system. It incentivizes businesses to adopt restorative economy practices, such as VAT exemptions and refunds.
Meanwhile, South Korea’s commitment to sustainability has been evident for some time. The nation has made significant investments in renewable energy, green transportation, and energy efficiency.
The government’s roadmap outlines several initiatives to promote its principles. Such includes developing a national resource management system and establishing a Circular Economy Promotion Council.
Other countries in Asia are already developing their circular economy framework. These are Japan, India, and the Southeast Asia region.
Harnessing the potential of countries in Asia
Transitioning from a linear economy to a circular economy is not limited to economic benefits. The system also promotes social and environmental sustainability as well as the streamlined management of resources.
“This (circular economy) requires a radical rethink of consumerism and a reshaping of global supply chains,”the Economist Impact shared.
Mainly, stakeholders may benefit from increased efficiency, reduced emissions, and improved resource management. It can help countries in Asia become more competitive in the global market and attract more foreign investors.
“Sustainable product and process designs are important circular economy plans. In such a business model, instead of selling products to consumers, companies can retain ownership of the physical products, and consumers only pay for the use they derive from them,”said Venkatachalam Anbumozhi and Fukunari Kimura in their write-up on Industry 4.0: Empowering ASEAN for the Circular Economy.
In the global trade arena, resource efficiency and reduction of waste aid in making countries in Asia attractive to trading partners who are also in search of a restorative economy. Therefore, circular economies also usher more significant trade and investments between Asia and other parts of the world.
Challenges in implementation
The circular economy has the potential to help countries in Asia shift to a more sustainable economy and reduce adverse environmental impact. However, several challenges should be addressed to implement circular economy-related efforts successfully.
As with any new concept, education, and awareness are crucial. There is a need for greater awareness and understanding of the circular economy. Wherein the propagation of knowledge ensures that the public understands the said economy and its functionality.
More importantly, many of the countries in the region have yet to develop a comprehensive legal and regulatory framework. It helps to facilitate the transition to a circular economy. This issue is compounded by the fact that many existing regulations need to be better suited to the needs of a circular system.
In this sense, the circular economy may depend on the availability of incentives and subsidies to promote the reuse, repair, and recycling of resources. Such would require governments to create policies, laws, and regulations supporting a circular economy’s development.
There is also a need for qualified professionals who understand the principles and benefits of a circular economy. This lack of expertise is a significant challenge for countries in Asia as they try to implement initiatives.
Benefits of a circular economy
The concept of the circular economic diagram is based on the idea that the Asian economy should be viewed as a continuous, interconnected system rather than a linear one where resources are extracted, used, and discarded.
“Circular models also aim to renew resources with methods like circular agriculture, which minimizes raw materials, reduces chemicals, and works with the seasons, rather than against them,”shared on the platform of Global Insights, which is an economics forecasting organization.
Said restorative economy can create more resilient countries in the midst of ever-changing economic landscapes. By reducing the consumption of materials and energy resources needed to produce goods and services, countries in Asia can lessen the negative impact on the environment.
Dr. Uwe Weber, the Team Leader of the SWITCH-Asia Network Facility, noted that certain communities allocate budgets for waste management services. He also projected that there would be about a 60% increase in the volume of waste in the next decade.
Aside from sustainability, locals can also gain employment opportunities. In turn, market prices may also become moderate in Asia.
“It [circular economy] ensures access to resources and hedge against price volatility while creating new opportunities. It enables to evaluate the relation between GDP growth and domestic consumption of raw materials or greenhouse gas.”shared by the Institut Montaigne, a non-profit think tank.
Whether it is vying for either environmental sustainability, social aspect, or economic growth, a circular economy poses the potential boost and progression of countries. Therefore, it’s no wonder that the said economic model is a growing trend across countries in Asia.