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Financing the transition to a circular economy

5 March 2019

The European Commission released a report this week to accelerate the transition towards a Circular Economy in Europe. The report highlights the ways in which improving access to finance for circular economy projects is necessary to achieve a transition toward more circular development.

“In a Circular Economy products are designed for durability, upgradeability, reparability, and reusability”. This radical change in approaching product lifecycles requires changes in business models. As the report points out – businesses based on services rather than high resource consumption are at the heart of this transition.

Circular project promoters, financial stakeholder as well as policymakers have a role in creating favourable conditions to move from a linear to a circular economy. Local governments in particular can play a key role in creating the environment for new circular economy projects to flourish. According to the report, the mechanism range from developing standards for circular activities to developing a market for circular products and services through public procurement.

The report was published by the Informal Commission Expert Group “Support to the Circular Economy”, in which ICLEI has taken part over the past two years, bringing cities’ perspectives and opportunities for the Circular Economy to the table.

Several cities are piloting circular economy approaches within the CircularPP project. To learn more about this project click here.

To access the full report, click here.