Circular Economy and the Americas – we need to distinguish between circularity, circular economy and the Circular Industrial Economy.

Circularity has been the base of life on Planet Earth; water, CO2 and matter circulate in chaotic self-organised systems, which do not know time or money constraints, nor waste. 

Early man had to cope with whatever resources were available and could be used as, or transformed into, shelter, food, products or tools. This was a circular economy based on scarcity or poverty, as expressed in an old New England maxim: use it up, wear it out, make it do or do without. Circularity was a necessity for most; only the rich and mighty lived in relative comfort. Situations of scarcity can still be found in less industrialised regions all over the world, including the Americas.

 

The Industrial Revolution enables countries to overcome scarcities, but mass-production first turns scarcities into plenty, then abundance and a plethora of waste.  

 

The post-industrial “economy in loops” is a Circular Industrial Economy (CIE) based on managing stocks and preserving values in saturated markets. Personal motivation is needed by economic actors and consumers to renounce consumption in order to reduce environmental impairment in mining, manufacturing and waste management. Social factors also play a role, because the CIE is by design a substitution of manpower for energy, material and water—but the fact that job creation is inherent in the CIE, is overlooked by many policymakers. This situation is typical for industrialised regions, where another problem starts to hit: assets collapsing due to a lack of maintenance. 

 

In some industrialised regions, manufacturers turn into fleet managers selling performance, function, and goods as services instead of selling goods, the corporate trend of the Performance Economy, the most profitable form of the CIE. In other regions, social trends of a “sharing society” develop and strengthen civil society: repair cafés, barter trades, and other self-help forms of circularity are gaining popularity in many countries.

  

So how can the American Continent best benefit and adopt the Circular Economy principles? Understanding that the circular economy as a regional strategy is the key, and that finding forms of circularity or CIE best suited for a given region is the challenge. A circular economy will enhance the regional natural, human, cultural, and manufactured stocks, capitals and assets in order to create maximum well-being and happiness – which are the essence of sustainability.

 

 

Walter R. Stahel, product-life.org, July 2017

 

 

 

[i] [1] Dr h.c. Walter R. Stahel is Founder and Director, The Product-Life Institute, Geneva. Visiting Professor at the Faculty of Engineering and Physical Sciences, University of Surrey, andat Institut Environnement, Development Durable et Economie Circulaire (IEDDEC), Montréal, Canada.

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