Resource Depletion

Every year, 60 billion tons of nonrenewable and renewable resources are extracted globally. This is nearly double the amount extracted in 1980. If linear economy remains unchanged and human consumption continues at the same rate, mankind will face scarcities in fossil fuels, uranium, and rare-earth elements by 2030. Usable freshwater will also shrink 40%. Resource depletion will not only significantly impact economic and human activities, but it could also trigger global conflicts.

Habitat Destruction

Over-mining, deforestation, over-cultivation, overfishing, and large-scale urbanization have all had a direct impact on habitat loss and reduction. Three-fourth of the world’s land habitats and two-thirds of the marine environment have been dramatically changed by human activities. This has led to a sudden decline in biodiversity and acceleration in climate change, as nature’s ability to conduct carbon sequestration is reduced.

Soil Degradation

Since the Green Revolution in the 1950’s, the use of chemical fertilizers and pesticides have become commonplace in modern day agriculture. While this farming method was able to rapidly increase food production in a short amount of time, it destroyed the microbial ecology in the soil, leading to soil degradation and an imbalance of the elements. According to the United Nations, a third of the planet’s land has already degraded, and after another 60 harvests, earth will not be able to fulfill the needs of the world’s animals and planets.

Waste of Resources

Not all raw materials that enter the factory become a product. Some become by-products, such as scraps, used chemical products, heat waste, animal feces, oyster shells and etc. And yet even though these by-products still have value left in them, they are treated as business waste in the linear economy. This is because linear economy focuses on production and not the value of resources. Consequently, the by-products are often sent to incinerators or buried. Sometimes they are simply abandoned in the surrounding environment.

Environmental Pollution

Under the linear economy, most industries have caused large scale pollution during its production process. Many harmful materials and industrial waste were released into the air, water, and soil, which has had a significant impact on the environmental ecology and the health of mankind.

Greenhouse Gas

Fifty-five percent of the world’s greenhouse gas emissions comes from the energy sector, with the remaining forty-five percent from the industrial processes and product sector (IPPU), agriculture, forestry and other land-use sectors (AFOLU). By 2050, the global demand for materials and food is expected to grow two to four times, and the corresponding increase in greenhouse gas emission will hinder our efforts to mitigate climate change.

Overconsumption

Growth under the traditional linear economy depends on mass consumption and production. However, the more products are manufactured, the more materials are depleted. To stimulate sales, some producers even use a planned obsolescence strategy, where they deliberately shorten the lifespan of a product so that consumers will spend more money to buy its replacement. This practice generates vast amounts of unnecessary waste.

Idle Resources

Idle resources is another problem with the one-off sales business model of the linear economy. Owners may fail to maximize the use of a product in its lifespan, thus preventing the product from being used to its full potential. For example, private vehicles are parked 95% of the lifetime, and only used 5% of the time, resulting in wasted materials and space.

Excessive Demand

An increase in the global population has led to an increase in resource demands. The rise of the middle has also led to an increase in spending per person. If our mindset does not shift away from “ownership-of-products” to “access-to-service”, it will only accelerate the imbalance between resource demand and supply.

Single Use Products

Single-use containers and packaging offer convenience to consumers, but these disposable plastics also generate waste and environmental damage. In Taiwan, 70% of marine debris are single-used food containers and packaging. In addition to producers’ responsibility, the “convenience is the best” lifestyle in the linear economy should be addressed.

Contamination

In nature, there is no waste. The output generated by one organism becomes an input for another. On earth, only human beings would create items that cannot be regenerated and looped back into the system. The non-biodegradable waste contaminates the environment no matter whether it is buried into the soil, incinerated, or floating in the ocean. If we do not take immediate actions, global waste will increase by 70% before 2050.

Social Inequality

Although the majority of the existing wastes were created by developed nations, the environmental and health costs of waste treatment are being paid by people in developing nations. Wastes that have not been properly addressed has led to illness and death of almost 400,000 to one million people in developing countries each year. The pollution from the wastes also affects farmlands, livestock and fishes, upon which the farmers and fishermen rely. This further deepens societal inequality and social costs.

Loss of Value

Recycling is the process of converting used products into secondary materials that are then used to make new products. In this process, only the value of the materials is captured.

While recycling can prevent the extraction of new natural resources and additional carbon emissions, water, labor and other resources will still be consumed during the new manufacturing process. Thus, if we can maintain the value of the product and its components through repair, repurpose, and remanufacturing before it goes into the recycling system, then can we reach the highest level of resource efficiency.

Downcycle

Secondary materials often lack the durability, purity, or physical properties of the original material; therefore, they can only be used for a lower-value product. Downcycling is a limitation of recycling.

Create high resource efficiency

In a circular economy, every resource will be properly used and recycled in the most valuable way to achieve greater benefits. Thus, for Taiwan, which lacks natural resources, circular economy not only is a key to economic development but also provides a turning point to stimulate innovation and create business opportunities.

Leading the trend

Agriculture and food, biotechnology, textiles, plastics, construction, transportation, electronics, and chemical industries have all been promoting circular economy, so have many international brands. Taiwan has the opportunity to become a critical hub of the circular supply chain.

Maintain resource stock and ecosystem

In a circular economy, profits can be decoupled from resource consumption, and an economic system in which resources can be regenerated or continuously recycled can be created. Such a system can reduce human demand for mineral and land development and prevents the generation of pollution and waste. Thus, the stock of natural resources and the functions of the ecosystem can be maintained.

Reversing climate change

From raw material mining, material manufacturing, production, transportation, use, and disposal, a product may generate a lot of carbon emissions. Therefore, to effectively curb climate change, in addition to the energy transition, we need to practice circular economy to change the current development model that consumes a lot of resources and sells products in a large amount.

Create job opportunities

Through innovative business models and various measures to preserve the value of products and resources, the circular economy model not only improves resource efficiency but also creates employment opportunities. It is expected to generate 700,000 jobs for the EU by 2030 and become a highlight and key component of the industry.

Public health

The escape of various pollutants into the environment causes pollution and signifies a waste of resources. Therefore, enterprises that adopt the circular economic model can eliminate toxic and non-recyclable substances from the product design stage and ensure that emissions and hazardous materials will not be produced during the entire product life cycle to protect the health of employees and the public.

Reverse the thinking that values GDP above all

The so-called growth in a linear economy is the growth of a company’s revenue or a country’s GDP. However, such numbers cannot truly measure many other values ​​that human beings care about, such as equality, justice, or happiness. In contrast, a circular economy will try to decouple economic prosperity and social well-being from environmental destruction and resource consumption, building a future that is symbiotic and beneficial to all.

Achieve sustainable development

Both economic growth and social well-being heavily rely on the natural environment. The United Nations has pointed out that among the 17 SDGs, ten are highly related to natural resources. Since practicing circular economy is a key strategy to achieve the SDGs, it is one of our obligations to the next generation.