Today’s current economic model relies on the conventional linear economy, which follows the pattern of creation, consumption and disposal of products. However, this linear economy is not sustainable. It leads to an increasing pressure on finite resources and generates significant waste, pollution and greenhouse gas emissions.
The circular economy offers an alternative way. It seeks to extract the maximum value from resources in use and keeps materials in circulation for as long as possible. It aims to minimise the environmental and social impacts, as well as to reduce economical costs and create jobs.
Looking beyond the current take-make-waste extractive industrial model, a circular economy aims to redefine growth, focusing on positive society-wide benefits. It entails gradually decoupling economic activity from the consumption of finite resources, and designing waste out of the system. Underpinned by a transition to renewable energy sources, the circular model builds economic, natural, and social capital. It is based on three principles:
Design out waste and pollution
Keep products and materials in use
Regenerate natural systems
A circular economy seeks to rebuild capital, whether this is financial, manufactured, human, social or natural. This ensures enhanced flows of goods and services. The system diagram illustrates the continuous flow of technical and biological materials through the ‘value circle’.