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A circular economy is the opposite of our current and linear economy – where materials are extracted from Earth, products are made, used and then thrown away as waste. A circular economy uses the Earth’s resources in a cycle as far as possible. The economic model aims to produce products that last and are used for a long time. To eventually recycle the material and use it again.

The model is a system that deals with global challenges like climate change, waste, biodiversity loss and pollution.

What is a circular economy?

A circular economy considers all parts of a product’s so-called life cycle. The aim is to make each part as sustainable as possible. The first step considers the design of a product. The design should aim to maximise the lifetime of a product and the highly efficient use of materials. Then, it is time to consider what kind of materials will be used. At best, these materials are recycled. If this is not an option, it will be new and raw materials. Then it is important to make sure that they are extracted sustainably and efficiently. A circular economy aims to reduce the overexploitation of the Earth’s resources – such as forests, metals and oil.

Next, it is time to manufacture the product. A crucial part of this process is to use green energy for production. Finally, the next part of a product’s life cycle is its actual use. Here, it is up to the consumer to use and reuse a product as much as possible. Finally, all the materials in a product should be recycled. With the hope that they can be reused as recycled material.


There are many benefits of a circular economy. Among things, the model aligns with the sustainable development goals. Particularly the goal of reducing consumption. More so, another benefit is related to the development of today. As more people are consuming more products. This puts high pressure on the Earth’s resources in a completely unsustainable way. Furthermore, the economic model reduces greenhouse gas emissions. For example, since efficient use of energy reduces emissions. 

Circular economy and economic growth

Many people fear what will happen to economic growth if new things are not produced. However, in a circular economy, sustainable products are still made from recycled or new materials. New material will still be needed in the circular economy, as recycled material has a limit to how many times it can be reused. Eventually, the material loses its quality. Furthermore, the high quality of products in this economic model also means that they can be sold for a higher price.

Across the world

Many agendas strive to move towards a circular economy in the world. For example, the EU and the UN are advocating for new economic models, yet the ideas around how to do this best differ.

Sweden is an example of a nation that plans to transition to a circular economy. The Swedish government announced a national strategy for a circular economy in 2020. An ambition that aligns with the country’s goal of becoming the world’s first fossil-free welfare nation. The core of Sweden’s national strategy is “a society where resources are used efficiently in non-toxic circular flows and replace virgin materials.”

Example of source: Ellen Macarthur, Swedish government


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