From Waste to Resource: Why Recycling is the Next Trillion Euro Industry in Europe

Only 9 percent of 400 million tonnes of plastic waste is reported to be recycled according to UN estimates.

Global Recycling Day is here and coming at a time when Europe is in shock — reeling in the shadows of the conflict in Ukraine, as well as the impact and uncertainty which this has cast on global supply chains. The scarcity of fossil resources and the access to them already emerged as a theme during the pandemic, but is becoming an increasingly bigger issue with the military crisis — threatening the very existence of many established companies and industries.

Positive things are also happening, although they are easy to overlook in such times. Two weeks ago, the United Nations Environment Programme (UNEP) met in Nairobi and adopted a resolution with astonishing speed and unity — quickly reaching a binding agreement to reduce plastic waste on our planet.

More than 60 countries came together to introduce the resolution to combat plastic waste, and in the end, a compromise emerged that was unanimously adopted by all 175 UNEP countries. The common goal: a binding treaty for all 175 UN countries that aims to regulate the “full life-cycle” of plastic by 2024.

Of course, critics are quick to comment. Some suspect that the Nairobi resolution sets limitations that are directed against the interests of the economy and are therefore being softened until 2024. I, however, am much more optimistic about this resolution.

Not only do I see a political milestone, a commitment to a better, more sustainable world, I also see momentum for our economy to understand the topic of environmental protection and specifically recycling as a chance to tap into previously unimaginable growth potential. I am convinced that with recycling we are talking about the next trillion-euro-market, right here in Europe.

The Absurdity of a Linear Economy

The global economic model on which we have relied since the industrialisation era is based on fossil resources. Looking at Germany, the problem is becoming more and more clear: We barely have any raw material deposits and are becoming increasingly dependent on other countries across many levels. Be it lithium, cobalt and nickel for the production of electric car batteries, rare earth elements for wind turbine motors or copper and aluminium for the expansion of electrical grids.

Every year, humans extract more than 100 billion tonnes of resources such as oil, gas and metals from the earth. This year’s Circularity Gap Report shows that only 8.6 percent of these are being reused.

According to UN estimates, 400 million tonnes of this waste is made up of plastics — and only 9 percent of this waste is reported as recycled. The rest ends up in landfills, is incinerated or floating on trash islands in the ocean. Since the industrial revolution, the problem has only worsened — and it goes far beyond plastic. We call this principle the “linear economy”: take, use and throw away.

This has to stop. We need a circular economy to eliminate pollution and waste, to circulate products and materials and to help nature regenerate — according to the principles of the market economy.

The “New Mines” of Modern Economies or Europe’s Next Trillion Euro Industry

Why has this potential remained unused so far? The answer is obvious: Recycling is still seen as an inconvenience in our economy.

Raw materials have been here with us all this time — they are in plastic, batteries and packaging. A circular economy could ensure companies permanent access to these important materials. Recovering more materials from waste will help us solve problems such as environmental pollution or supply bottlenecks, while protecting the climate at the same time — and it would open up new opportunities for companies to increase revenue and create new markets.

Creating a Circular Economy in Europe

Let’s come back to Nairobi. What role can this resolution play on the road to a circular economy? For the first time, we have a global framework that can fundamentally change our perspective on sustainability. It’s no longer sustainability OR profitability.

It is important to realise that through sustainability, businesses can prosper worldwide. This is especially true for Europe, as the continent depends greatly on the supply of resources from abroad. We must realise that we are sitting on a great treasure trove of resources right here that we can make use of.

In order to realise this potential, we need a way forward. One that is available to us all, now. I believe the building-blocks for this are already available. Waste management is our current solution for all end of life materials, the only issue is that most of it is burned.

If we can solve this, if we can close the loop on resources, then we can successfully create a circular economy. Not in decades to come, but starting right now.

Companies need to question old structures and supply chains and ask themselves how they can get more out of raw materials and recycling materials. At the same time, we need to see more start-ups and established companies investing into this space — utilising technology to fully unlock the circular economy.

With this transformation, we will achieve independence, a new trillion euro ecosystem with its new unicorns and, above all, an economic blueprint for saving and preserving our planet.