The Circular Economy Show Podcast

The circular economy: a ‘triple play’ climate solution for China | Circling Back

Episode Summary

Amid rising emissions, rising temperatures, and the rapid rollout of material-intensive renewable energy systems that promise to curb them both, climate mitigation and adaptation are a central priority for China’s government. In this episode, host Seb talks to Lei Chen from the Ellen MacArthur Foundation’s China team. They go behind the headlines to look at: - The role China could play in accelerating global circular transitions - Why the circular economy could offer China a ‘triple win’ in achieving its climate ambitions. China probably isn’t the first place that comes to mind when you think of a circular economy. But maybe it should be.

Episode Notes

Amid rising emissions, rising temperatures, and the rapid rollout of material-intensive renewable energy systems that promise to curb them both, climate mitigation and adaptation are a central priority for China’s government. 

In this episode, host Seb talks to Lei Chen from the Ellen MacArthur Foundation’s China team. They go behind the headlines to look at:

China probably isn’t the first place that comes to mind when you think of a circular economy. But maybe it should be. 

Read more in ‘The circular economy: a ‘triple play’ solution for achieving China’s climate objectives’

This conversation originally featured in episode 166: China, climate, and the circular economy, published in November 2024.

We hope you enjoyed the fourth of our five-part Circling Back series. If so, please leave us a review or a comment on Spotify or YouTube. Your support helps us to spread the word about the circular economy.

Episode Transcription

[01:00:00.320] - Emma Elobeid

China probably isn't the first place that comes to mind when you think of a circular economy, but maybe it should be. The world's largest manufacturing hub and home to a rapidly expanding consumer market, China has deep roots in circular economy practices such as ancient agricultural systems.

 

[01:00:20.120]

While circular thinking isn't new in China, many of its initiatives, like its well-known eco-industrial parks, have remained relatively isolated. So why could all that be about to change? Amid rising emissions, rising temperatures, and the rapid rollout of material-intensive renewable energy systems that promise to curb them both, climate mitigation and adaptation are central priorities for China's government.

 

[01:00:47.760]

In this episode, Seb talks to Lei Chen from the Ellen MacArthur Foundation's China team, going behind the headlines to look not only at the role China can play in accelerating global circular transitions, but why the circular economy could offer China a triple-win solution in achieving its climate ambitions.

 

[01:01:12.220] - Seb Egerton-Read

Lei, thank you for joining us on The Circular Economy Show podcast. Many of our listeners will be familiar with the state of play of the circular economy in contexts like the European Union, perhaps many even in North America. A lot less of them will know what's happening in China with the topic. I thought I'd start this podcast by asking for you to characterise where is the topic of circular economy in China right now?

 

[01:01:40.260] - Lei Chen

Absolutely, Seb. Thank you for having me for this session. I would be happy to delve into this topic. Circular economy in China actually has deep historical roots. One of the earliest examples is a traditional agriculture system, which is called the Mulberry Dike Fish & Pond System. It's actually originated more than 2,500 years ago, and you can still see them in some part of Southern China.

 

[01:02:09.100]

In simple terms, the farmers grew Mulberry trees to feed silkworms for silk production, and the leftover leaves and the silkworm waste then used to feed the fish in ponds. Then the fish waste fertilised the mulberry tree. You can see it's actually created the natural cycles where everything is reused and nothing went to waste.

 

[01:02:32.630]

Entering modern days, it was not until the mid 2000s that China began to adopt formerly the circular economy principles, focusing on the three R strategy, which is reduce, reuse, and recycle. They were inspired by the waste management legislation in Germany and in Japan.

 

[01:02:54.600]

The initial focus was very much heavily geared towards pollution control and the waste management because at that moment, China went through a rapid industrialisation and urbanisation. The master movements for this stage was the introduction of the circular economy promotion law since 2008.

 

[01:03:18.500]

One of the key strategies at this period was the development of eco-industry parks. Those are the zones that the business collaborates together. The waste or by-product from one company become the raw materials for another. Along the side, China also started to build up a vast recycling network. This system is designed to handle both domestic and industrial waste, recovering valuable material that could otherwise end up in landfills or incineration.

 

[01:03:48.640]

More recently, China started to shift the focus more on the consumption side. As people know that China is a manufacturing hub in the world, but actually, we have such a big population, and the government are now starting to look if we can shift the consumption model employing a circular principle. This is a new feature.

 

[01:04:20.660]

Even today, the circular economy is increasingly linked to climate goals in China, where the ambition is target of achieving carbon neutrality by 2060. Circular practice are seen as a vital tool for reducing emissions and promote climate resilience across different sectors. Circular economy really is a fascinating concept in China. It's gaining even further momentum now.

 

[01:04:50.420] - Seb Egerton-Read

We've done this research on the link between the circular economy and how it can support what China wants to achieve in terms of climate goals. This is an extension of some research we did more globally in 2019 called Completing the Picture. We're launching, publishing, promoting that during the COP conversations later this month in November. My question to you is, where did the need for this research come from? What did we do?

 

[01:05:24.380] - Lei Chen

It's become very evident that from different legislation and framework and government policies that circular economy can and should be a part of the climate solution in China. Together with energy transition, they completed the picture for addressing the climate change.

 

[01:05:44.740]

There is a strong consensus on the importance of the circular economy on climate action, but the barrier remains there to realise its full potential, for instance, the quantification barrier, the implementation barrier. As EMF, we realised that the need to move beyond the why; why is the economy matters and focus on the whole question, how to deliver its potential.

 

[01:06:14.580]

As EMF, we have been, as you mentioned, have some efforts to try to bridge the evidence gap by, for instance, publishing the completing in the picture reports some years ago. We also have done some research in China in recent years. But we see in China, the localised efforts were still lacking and sometimes also scattered.

 

[01:06:41.880]

That's why we tried to initiate a research collaboration with Tsinghu University. We realised the facts are important, but narrative matters as well. We spent quite some time crafting the narrative and to tell a compelling China story. The story, it differs from the typical narrative we often hear and encounter in the China markets. Our aim for this research was to make this concept more relatable and engaging for wider audience. Not only for circular economy experts, but also for climate experts.

 

[01:07:24.860] - Seb Egerton-Read

I really liked what you said there, Lei, this is about the data and the evidence and the insights to support a point of view, but it's also about the story and the narrative for China and the relevance of circular economy for China, specifically, and those two things being equally important. Let's get into that. If there were one or two key insights that someone would take from this publication, what would those be?

 

[01:07:55.940] - Lei Chen

I think the key message is actually embedded in the title of the paper. The title of the paper is, The circular economy: a ‘triple play’ solution for achieving China’s climate objective. The triple play is a key message. Our research has offered a triple-play solution, being reducing greenhouse gas emissions in hard-to-abate sectors. Secondly, helping secure critical raw materials in the transition to renewable energy. Thirdly, enhance resilience across this economy against the effects of climate change. That's the three things, three strategy we set out for a circular economy in climate action.

 

[01:08:45.520]

I just want to quickly deep dive into each of the strategy of the triple-play, maybe. First of all, it's reducing greenhouse gas emissions. In EMF, we have the narrative, 55 of the emission comes from energy and 45 comes from the way we produce and consume food and goods. It is very evident that the circular economy should be part of the emission reduction strategy.

 

[01:09:18.160]

In this research, we focused on three case sectors that shape our daily lives, building environments, mobility, and plastic. In total, they account for nearly half of the total emissions in China.  By synthesising the existing studies, we found out that if we're applying a set of circular strategy, then we can reduce one-third of the emissions of these three sectors. This is quite a big potential.

 

[01:09:55.920]

Secondly, about securing raw materials. China is actually leading seen the world in renewable energy transition. But the element which is often overlooked is the renewable energy transition relies very much on the critical raw materials, and much of it actually depends on import. How circular economy can support decoupling the renewable energy growth from this material extraction and use? That could be a big topic, and we have done some research on this. That's the second strategy of the triple-play solution.

 

[01:10:35.080]

Certainly, which is relatively under-discovered. We found very limited evidence, it's the linkage between circular economy, the resilience, and climate adaptations.

 

[01:10:49.600] - Seb Egerton-Read

It feels like that resilience topic will only increase in its importance as the conversation around climate change adaptation increases as well. I really think that point you make, the second insight that you mentioned about the dependency, one that perhaps some listeners won't know just how significant the investment and speed of transition towards renewable energy, towards electric vehicles is in China, which is really substantial.

 

[01:11:19.380]

I was reading a piece the other week about the scale of the infrastructure build up and the likelihood of being really a high percentage electric vehicle cars by a very short time frame, being far outstripping the progress that we're seeing in other parts of the world, whilst we're also seeing progress in other parts of the world.

 

[01:11:42.820]

Of course, that being effectively also very dependent on raw material extraction and increased utilisation and circulation of those critical raw materials from both a resilience point of view, but also from a material effectiveness point of view. It's really significant. Obviously, that's hopefully where the insights of this paper come in. We've published this research. We've told, hopefully, a compelling story. What are the key recommendations that come out of that work for a circular economy in China?

 

[01:12:19.980] - Lei Chen

In this paper, we have leveraged the EMF's Universal Policy Goals Framework to come up with a set of actions. We have proposed 15 actions and 5 goals. The policy can take… We focus very much on the policymaking side. The first one is stimulating design for the circular economy. Design is always important. We always have to emphasise as upstream innovation opportunity here throughout the economy.

 

[01:13:05.820]

The second is about managing resources to preserve value. How we can really build efficient and high-value resource management, so move beyond waste management, but resource stewardship. That's the key element to harness the benefits of the design considerations.

 

[01:13:29.520]

We talk about how to make the economics work. We need some incentives and perhaps also some disintensives for the linear model to make the economics work, to make the business case appealing.

 

[01:13:47.220]

For the fourth point, we mentioned invest in innovation, infrastructure, and skills. We need some hardware and software properly integrated to deliver the potential to upskill the circular benefits. That's about the facility, that's about the data infrastructure, that's about the skills needed from the labour force.

 

[01:14:09.940]

We also talk about collaborate for system changing because circular economy. As we put it in the paper, it is a system agenda, and a system agenda needs a system thinking and a system framework. We have the policy, and we need the business, and we need the civil society and also, all the sellers, they have to work together to deliver the benefits needed. That's the five goals. Each goal, we propose three actions. There could be more, of course, but we keep it to 15. I think they are all very relevant for China, for the climate, and for circular economy.

 

[01:14:55.900] - Seb Egerton-Read

You thought asking them to do 15 things was a good place to leave. It was enough. I think the emphasis of those actions you're talking about, of course, are towards policymakers, and towards policymakers in terms of move beyond thinking about this as a waste management issue alone.

 

[01:15:15.620]

All five of those areas you articulate talk about making policies that don't purely focus on that downstream recycling end of pipe, but actually move upstream. Think about the economics, think about resource stewardship, investment and collaboration. Lei, thank you very much for joining us on The Circular Economy Show podcast.

 

[01:15:37.540] - Emma Elobeid

As well as facing considerable climate challenges as a country, China also plays a central role in global climate policy. Meeting its ambitious climate targets will require a powerful, integrated strategy that cuts hard-to-abate emissions at scale, keeps critical minerals essential for the energy transition in use, and strengthens its economy against shocks.

 

[01:16:01.980]

With COP30 coming up and a 15th five-year plan now in active development, a significant opportunity exists for policymakers to integrate circular economy measures into their overarching climate strategies and harness its power as a triple-play solution for advancing climate action.

 

[01:16:22.440]

Liking what you're hearing? Drop us a line or a review, and let us know. Don't forget to join us next time for the final episode in this circling back series of The Circular Economy Show, all about design.