What Is The Circular Economy?

First of all, it is important to highlight the idea that the paradigm of the current economic model of production and management of resources, goods and services based on “produce, use and dispose” may be obsolete. In fact, there are data that underpin this hypothesis. From there, today we will talk about the circular economy.

We see that the current system, due to many of its dynamics, clashes with the idea of ​​long-term sustainable development. Furthermore, it is a risk to nature, especially given the fact that there is no waste in nature. All elements have a continuous function, are used and reused in their different stages.

That’s how we arrived at the idea of the circular economy, the new paradigm that could replace the current one. The purpose of this article is to study its characteristics, principles, importance and benefits. Let’s develop the theme below.

What is the concept of circular economy?

The circular economy takes as its starting point the cyclical model of nature. This system advocates the use of resources by reducing production to the essential minimum and reusing elements.

It encourages the production of goods made from biodegradable materials so that they can return to their natural state without causing damage to the environment or depleting their useful life.

In case there are no biodegradable materials, the objective will be to carry out a separation in which the product components can be reincorporated into the production cycle. If this is not possible, they must be recycled in an environmentally friendly way.

Thus, we see that the essence of the circular economy is restorative and regenerative. In fact, the term “circular” has special relevance because a continuous cycle of positive development that conserves and enhances natural capital is being created.

What are your principles?

The circular economy is based on the reconstruction of financial capital, manufactured, social, human or natural. In this way, it guarantees an improvement in the flows of goods and services. This “circle of value” created is based on the following principles:

• Preserve and improve natural capital. It enhances the flow of nutrients in the system. For example, conditions are created that improve soil regeneration.
• Optimize resource usage. It promotes a rotation of products, components and materials with the aim of achieving their maximum usefulness at all times. Thus, the speed of product turnover is reduced, increasing their useful life and encouraging their reuse.

• Boost system effectiveness. Reduces human damage, eliminates negative externalities.

What are its benefits?

As we have already mentioned, the linear production system that predominates in the world economy today is limited in its use of resources, in addition to having a high social and environmental impact.

Thus, numerous experts expressed their concern, arguing that reducing the use of resources and the use of renewable energy will not be enough to face the current challenges of the environment.

Linear models are based on fluctuating prices and contribute to environmental degradation, which affects the basic principles of development. Thus, we see that the circular economy approach, based on innovation and long-term resilience, brings countless benefits.

First, it  ‘s beneficial to both users and businesses. Companies that put the circular system into practice have proven that reusing resources is more profitable than creating them from scratch: production prices decrease.

As a result, the selling price is also reduced, benefiting the consumer in social and economic aspects.

In the European Union, the measures advocated by the circular economy could generate savings of 600 billion euros for companies in the region. Currently, the extraction of raw materials has important consequences for the environment. These companies would reduce total annual greenhouse gas emissions between 2% and 4%.

With the growth of the world population, the demand for raw materials increases, which are limited. The circular economy could help reduce pressure on the environment and improve security in the supply of raw materials.

The system could also lead to a reduction in dependence on other countries for obtaining certain raw materials.

It would also increase competitiveness, growth, innovation and employment. It is estimated that up to 580,000 jobs would be created in the European Union if the application of this system were improved, as well as the production of innovative and more durable goods.

Eliminating planned obsolescence could improve everyone’s quality of life.