In accordance with the specifications published by the European Commission’s Directorate-General for the Environment: Products Policy Service, the Belgian government commissioned a study on the potential of the Circular Economy in Belgium from PwC in consortium with the Institut de Conseils et d’Etudes en Développement Durable and Oakdene Hollins. 

The study has three main objectives:
1.  to calculate the economic potential of developing a circular economy in Belgium,
2.  to specify the indicators which will be used to assess the proposed objectives, and
3.  to propose concrete, quantified and realistic objectives for an EU-wide policy.

The circular economy has many different definitions in literature.  In this study, we chose a definition of the circular economy that takes into account not only production but also supply of goods and services, together with demand, the behaviour of consumers and waste management.  The chosen definition therefore has multiple facets:

  1. industrial symbiosis;
  2. second use of product;
  3. repair;
  4. second use of components;
  5. recycling;
  6. eco-conception;
  7. servicisation.

The Circular Economy is the subject of vital attention due to the potential for economic development and growth that it brings.  Indeed, according to experts and promoters of this new activity, the transformation of our economy from a linear model (one in which resources are exploited and consumed and are ultimately transformed to waste) to the more resource-efficient circular model (which aims to maintain manufactured products, their components and materials as long as possible within the system while ensuring the quality of their usage) allows us to realize economies and to generate economic activity and employment while conserving resources and reducing the environmental impact on society.

There are two mechanisms by which the circular economy creates added value and employment.  Firstly, the circular economy can be a source of cost reductions, not only in procurement of raw materials and other inputs linked to production, but also in waste management, etc.  Secondly, it can stimulate the development of new products, goods and services; for example, in the fields of repair, recycling, servicisation, etc.

Several organisations have put forward early estimates of the economic potential of the circular economy.  The Ellen MacArthur Foundation, for example, evaluates the worldwide economic potential at no less than US$1 billion per year.  At the European level, it estimates more than one million jobs that could be created by the circular economy.

In this context, the assets that Belgium can rely on – the quality of its workforce, its technical expertise, its capacity to innovate, its central position in Europe, etc. – should enable it to fully participate in the movement, and to create economic activity and jobs in the scope of this new paradigm that is the circular economy.  The study brings a quantitative insight to this matter and considers three scenarios for the development of the circular economy in Belgium.

We focus initially on four sectors: the chemical industry, the food industry, the machinery and equipment industry and the automobile industry.  Extrapolating the results for these four sectors to the whole economy indicates a total economic potential for Belgium of between €1 billion and €7 billion added by 2030 and between 15,000 and 100,000 jobs by the same time, depending on the scenario.

With the aim of achieving follow-on of the development of the circular economy, we identify specific indicators which will measure the degree of circularity of the economy and its evolution.  We propose objectives for six of these indicators designed to follow the development of the circular economy in Belgium and, in particular, the level of circularity of the economy as well as the level of decoupling of economic growth and use of raw materials.  The indicators are set with the goal of maximizing the creation of value added and jobs which are expected from the development of the circular economy in Belgium:

1.  To increase the resource productivity by 30% between 2014 and 2030.
2.  To increase the energy productivity by 50% between 2013 and 2030.
3.  To decrease the waste generated per capita by 30% between 2012 and 2030.
4.  To decrease the waste management costs by 30% between 2010 and 2030.
5.  To increase respect in the hierarchy of treatment of waste, measured as a decrease from 12.1⁰ to 11.25⁰ Lansink-RVE.
6.  To increase the proportion of remediation and repair activities in the whole industry and market services by 30% between 2013 and 2030.

The full report is available in French, and a four-page summary in English is also available.  Please contact Edward Sims for more information.