China and EU sign memorandum of understanding on circular economy

China and the European Union (EU) have signed a memorandum of understanding (MOU) on the circular economy at the 20th EU-China Summit, held in Beijing 16-17 July.

A circular economy implies reducing waste to a minimum and re-using, repairing, and recycling existing materials and products.

The ‘historic’ agreement, signed by European Commission Vice-President Jyrki Katainen and the Chairman of the Chinese National Development and Reform Commission He Lifeng, could see the world’s two largest economies align key circular economy mechanisms and pave the way for the development of product standards and policies, which could create the conditions for a ‘system shift’ on a global scale towards a low carbon, regenerative economy.

Representatives of China and the EU at the summit, including Donald Tusk, President of the European Council (left) and Xi Jinping, President of China (right)

Co-operation by the two economic powerhouses in this field will cover strategies, legislation, policies and research in areas of mutual interest. It will address management systems and policy tools such as eco-design, eco-labelling, extended producer responsibility and green supply chains as well as financing of the circular economy. Both sides will exchange best practice in key fields such as industrial parks, chemicals, plastics and waste.

Recent analysis carried out by the Ellen MacArthur Foundation(EMF) has found that a transition to a circular economy in China’s cities could have numerous local benefits, including making goods and services more affordable for citizens, as well as reducing the impacts normally associated with middle class lifestyles, such as traffic congestion and air pollution.

Earlier research has found that Europe could add €0.9 trillion (£0.8 trillion) to its GDP by 2030 by moving to a circular economy, while also halving its CO2 emissions.

Dame Ellen MacArthur, founder of the Ellen MacArthur Foundation, commented: “China has long been a pioneer of circular economy policies and practices, and Chinese cities are hubs of circular economy innovation. Transition to a circular economy presents China's cities with significant opportunities to create new value, economic growth, and further drive that innovation, while becoming more liveable for citizens.

“Collaboration and sharing of knowledge and best practices are key to unlocking these opportunities. Closer alignment on the circular economy between China and the EU is a significant step, paving the way for a global shift towards an economic system that works for business, people and the environment.”

China raising environment protection standards

Both the EU and China have made significant recent moves towards adopting more sustainable, environmentally-friendly practices.

China has been a frontrunner on circular economy policy for over twenty years; President Xi reaffirmed its commitment at the 19th National Congress of the Communist Party of China last year.

It has also recently launched a number of policies and campaigns which represent a concerted effort to raise environmental standards, including dedicating 252 billion yuan (£29 billion) to addressing waste problems from 2017 to 2020.

The most significant action, however, has been the country’s crackdown on contaminated recycling. 24 grades of solid wastes – including unsorted mixed papers and post-consumer plastics – are completely banned, while any other materials exceeding a contamination limit of 0.5 per cent are also blocked.

This has had a significant effect on UK recycling, as around 494,000 tonnes of plastics and 1.4 million tonnes of recovered paper were sent to China every year. UK plastic waste exports to Malaysia have tripled in the first four months of 2018 as a result of the ban as recyclers seek alternative markets for their recyclate.

As a further measure, in March, China launched ‘Blue Sky 2018’, a customs crackdown on the illegal smuggling of foreign waste, running until December, which follow in the same vein as similar campaigns including 2013’s Operation Green Fence and 2017’s National Sword Campaign.

Zhang Guangzhi, a spokesperson for China’s customs authority, commented that the networks which facilitate the ‘smuggling of foreign rubbish’, such as waste-trafficking gangs and smuggling channels, will be the targets of concerted action, while the supervision of imported waste will be strengthened through co-operation with environmental and law enforcement authorities.

EU’s Circular Economy Package

The EU Circular Economy Package (CEP), launched by the European Commission (EC) in 2015, is an ambitious programme of laws and actions designed to create a more resource-efficient Europe. It was approved by the EU Council in Brussels on 22 May this year, following disagreements on recycling and packaging targets and extended producer responsibility.

The legislation includes key recycling targets; EU member states have to reach a 55 per cent municipal recycling rate by 2025, 60 per cent by 2030, and 65 per cent by 2035. There are also numerous material-specific targets, and member states have until 1 January 2025 to establish separate collections for textile waste and hazardous waste from households.

Additionally, producers are given an important role in this transition by making them legally responsible for their products when they become waste. Mandatory extended producer responsibility schemes have to be established for all packaging by 2024.

The EC has also shown a commitment towards becoming more resource-efficient by allocating  €941 million (£828.3 million) in support of the circular economy in the EU until 2020. This funding comes as part of the final programme of work for the Horizon 2020 programme, a €77-billion (£68 billion) research and innovation funding programme running from 2014 to 2020.

The Memorandum of Understanding on Circular Economy Cooperation can be found at the European Commission's website.

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