THE world is changing from a throwaway economy to a circular one. There are many reasons for this. One, our resources are showing signs of depleting. Two, extracting a fresh new resource can emit GHG (greenhouse gases) and is costly. Not to mention the building up of environmentally hazardous wastes.

The linear economy is no longer tenable. The era of the throwaway convenient lifestyle is unsustainable. Many countries around the world are actively pushing for the circular approach.

However, implementing a circular economy (CE), where materials and resources are reused, recycled or regenerated, faces several significant obstacles. These challenges can be categorised into technical, economic, social and regulatory factors. Clearing the roadblocks calls for strategies.

Many regions lack the necessary infrastructure for efficient recycling, remanufacturing and refurbishing, especially in sectors like electronics and textiles. The e-wastes are a growing concern as the world goes increasingly electronic.

Many products are not designed for reuse, repair or recycling. Components may be hard to disassemble, or materials may not be compatible for recycling.

New technologies are needed to recycle complex materials or to separate and recover materials at an economically viable scale. Tracking materials and ensuring transparency across supply chains is challenging, especially for multinational companies dealing with multiple suppliers.

The shift to circular systems often requires large investments in new technologies, infrastructure, and processes. In many cases, linear business models (take-make-dispose) are still more profitable than circular models. Companies may struggle to make circular practices cost-competitive without government incentives or consumer demand.

Circular economy systems rely heavily on achieving economies of scale, but many regions or industries lack the volume of waste or resources to make recycling and reuse viable on a large scale.

Globalised supply chains and a focus on mass production can make it difficult to localise production and reprocessing, which is often key to circular practices.

Many consumers still prefer new products over refurbished or second-hand goods, making it difficult to foster demand for circular products.

There is also a lack of awareness about the benefits of a circular economy. Both consumers and businesses can be resistant to changing their consumption or production habits, particularly when circular practices seem less convenient or are perceived as more expensive.

Refurbished or recycled products are sometimes viewed as lower-quality or less reliable than new ones, discouraging consumers and businesses from adopting them.

The absence of standardised regulations on product recycling, extended producer responsibility (EPR) or material reuse makes it difficult for businesses to adopt circular practices consistently.

Many governments still prioritise linear economic growth over circular models and policies that can incentivise circular economy practices.

Paradoxically, some waste management regulations can make circular practices more difficult by classifying reusable materials as waste, complicating their processing and reuse.

The circular economy requires international cooperation, especially for multinational companies and industries. Regulatory differences across borders can hinder the adoption of circular models.

Shifting from linear to circular supply chains is complex and involves rethinking entire processes - from material sourcing to end-of-life recovery. Not all supply chains can be easily adapted to circularity.

In some cases, companies struggle to secure a stable supply of recycled or reused materials to meet production needs.

High levels of contamination in collected waste can make it difficult to recycle materials efficiently. Effective collection systems are crucial to capture products at the end of their life cycle, but many places lack robust take-back systems.

Addressing these challenges will require cooperation between businesses, governments, consumers and NGOs, along with significant investments in infrastructure, education and policy reform.

In Malaysia, the Investment, Trade and Industry Ministry has just launched the CE blueprint for the manufacturing industry.

Meanwhile the Housing and Local Government Ministry is busy implementing the CE for solid wastes. Since both manufacturing and solid wastes cut across many ministries, critics opine it is wiser to have an integrated CE framework.

Such standalone CE plans may not be the best solution to gear up the nation for the shift to circular. It is time for an umbrella CE framework which will galvanise the plans for all sectors of the economy.

The writer is an associate fellow at the
Ungku Aziz Centre for Development Studies, Universiti Malaya.
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