Circular Economy

Shifting Towards Circular Policy Framework in Developing Countries: Taking stock and Getting Inspired

This note explores how policy frameworks in developing and least developed countries, with a special focus on trade-related policies, are promoting circular economy. It aims to highlight some best policy practices to better support circularity, implemented by national governments, through national policy making as well as implementation of commitments taken at regional level. It provides examples from various regions across the developing world.

Review of existing frameworks shows that circular economy is already considered in some developing countries around the Globe, mostly in Latin America, but also more and more in Asia and Africa. Trade is an integral part of circular economy, though trade-related policy options and strategies seem to be lagging behind in efforts to adopt and implement more circularity in their policy frameworks. The note identifies good policy practices from developing countries and some LDCs, as well as from regional organizations on how circular economy could be embedded in the policy frameworks, including trade-related ones.

It is however found that most of the developing countries and LDCs lack human, financial, technical and technological capacities to fully implement their national plans and policies related to circular economy (when they have one). Or, they may face challenges in translating relevant circular economy principles they have signed on at regional level into their national policy frameworks including on trade.

These countries and LDCs will need to receive adequate human, financial and technological assistance to be able to holistically revise their policy framework (including on trade), and coherently implement it, so that it benefits their businesses, people and environment.

Besides capacity constraints, policy gaps would also have to be addressed to exit linear processes and ensure more circular economies in the future. In this regard, regional collaboration between countries that are frontrunners in the domain and others with more limited knowledge and capacities, including on policy revision and implementation, can pave the way toward more circularity. Coordination in the implementation of policy measures should also be ensured, which will require trade policy-makers to work closely with other key public and private stakeholders (such as environment ministries, trade unions, cooperatives, and the private sector of all sizes) to ensure a fair and inclusive transition towards circular economy.