Towards a Competitive and Growth-Oriented Circular Economy: the Role of the Packaging Value Chain9 May, 2016
The below article is EUROPEN's contribution to the Global Sustain Yearbook on “Sustainable Consumption and Production: Towards a Circular Economy”. A global multi-stakeholder album to be published in June 2016 in collaboration with the United Nations Environment Program (UNEP) and specifically with the Regional Activity Center for Sustainable Consumption and Production (SCP/RAC) of the Mediterranean Action Plan (MAP) .
“It is not the strongest of the species that survives, nor the most intelligent, but the one most responsive to change”
Charles Darwin (1809-1882).
Indeed, shifting our Linear Economy towards a Circular Economy will require change and thus responsiveness from producers and consumers. How to move towards business models with virtually no waste but only (secondary) raw materials that are reinjected into a Circular Economy? What kind of European policy framework is needed for the packaging supply chain in Europe to drive investments towards a competitive and growth-oriented Circular Economy? How do we take into account the globalility of value chains in this European framework? These are just a couple of questions EUROPEN is addressing amidst policy discussions related to the EU’s recently launched Circular Economy proposals.
This policy framework will impact a wide range of sectors and materials, including the packaging and packaging waste sector. One precondition to achieve a growth-oriented Circular Economy is a well-functioning Internal Market which should be protected. For our sector, the Internal Market principle ensures the free movement of packaging and packaged goods across Europe in its 28 Member States. It helps avoid national trade barriers while providing a European-wide economy of scale often needed for investments in making packaging materials and packaged goods more :“circular” and resourceefficient in a resource and land restraint Europe.
EU policy-makers are slowly embracing life-cycle thinking in their policy deliberations which come hand in hand with “Circularity”. For the packaging supply chain, life cycle approaches (LCA) take into account trade-offs, as changes in one part of the chain will inevitably affect another part. For instance, changing the type, weight or design of packaging may negatively impact the pack’s ability to protect, preserve or market a particular product. Packaging should therefore always be
considered in the context of the product it contains, and not solely based on the end of life phase. Packaging contributes to resource efficiency in all phases of
its life cycle by optimising resource use, helping to prevent product and food waste, extending a product’s shelf-life, protecting products along different value chains, providing consumers with varied uses, choices and benefits of the products it contains and finally to recover the used packaging at the ”end-of-life” phase intended for a next economic cycle. By answering these challenges, packaging is not only vital to our modern societies and life styles, but forms a crucial part of our Circular Future.
A key instrument that links the Circular Economy, the Internal Market and the packaging waste policy is Extended Producer Responsibility (EPR) for used packaging. This end-of-life instrument is currently applied in 25 Member States in European Union and has been instrumental to enable the separate collection and sorting of used packaging to reach European and national recycling targets for packaging. EPR is seen as a key inter face between the supply and demand sides of material flows which are reinjected as products or materials into the economy. This important role and potential is acknowledged in the Circular Economy Package, which calls for binding European minimum per formance requirements on EPR compliance schemes (packaging recovery organisations) to ensure more transparency and cost-effectiveness on existing EPR schemes and proper enforcement in the countries implementing EPR. A minimum level of harmonised European rules will help producers and importers in Europe to comply with their legal obligations under EPR and will ensure more control and transparency on their end of life costs. Better functioning EPR will ultimately boost qualitative and quantitative secondary raw material markets which will help industry to better manage volatile (virgin or secondary) material markets and related material supply and demand challenges that businesses face in Europe and beyond: the essence of the Circular Economy objectives.
The Circular Economy Package offers a great opportunity to address regulatory and market barriers in Europe and its Member States. Along with a well-functioning Internal Market for packaging and packaged goods, the packaging supply chain in Europe remains committed to further transition to a resource-efficient and competitive Circular Economy in which we see a more transparent and functioning EPR framework as key for our industry to meet its current and future sustainability