Embracing a Circular Economy to Bolster Pandemic Economic Recovery
Going Green with Brown
The coronavirus pandemic has proven to be a disruptive force in both the global economy and the United States economy. The evidence is clear that the pandemic has plunged the economy into a recession. The International Monetary Fund is estimating a global loss of $2.7 trillion loss to the global economy. The contracting economy may present an opportunity to retool and pivot the current complex economies. Here, the pandemic might provide an opening to allow for the circular economy—an economy that adheres to sustainable principles and keeps resources in circulation—to become integrated in the rebuilding of both national and international trade. The circular economy can start off as localized to show a sustainable approach to a more circular economy.
Global Faults & Circular Solutions
The pandemic has exposed the vulnerability of the reliance on the global economy, exploiting supply chain vulnerabilities for nations that rely on other nations for manufactured goods. A prime example of this was the fact 3M’s masks are manufactured in Shanghai, China and supplies have been strained. Presently, China leads the global economy in manufacturing and exporting of goods according to the Brookings Institute. A sustainable economy should be based on a more diverse supply chain.
An advantage of a circular economy is that it provides an opportunity to improve the resiliency of raw materials. The other point to consider is the circular economy can also safeguard local economies from national pressures created by events like the pandemic. Creating a natural, secure capital market can be achieved by adopting a well-designed circular economy concept.
Almost all sectors across the economies of the world saw an impact from the COVID-19. West Texas Intermediate crude oil was trading at a negative value the week of April 20-24, 2020. This historic moment showed the vulnerability of the modern global economy and the need to evaluate how to safeguard the economy moving forward.
A major benefit of a circular economy is the opportunity to stimulate local economy and job growth. The COVID-19 pandemic has already displaced an estimated 50 million workers. The displacement of the workforce means there will be less spending in the local economy, compounding the economic impact from the pandemic. A solution to employing people coming out of the COVID-19 restrictions is to support small businesses who adapt concepts of the circular economy more rapidly.
The circular economy allows for more localized businesses to take the lead in supplying goods and reducing waste at the same time. The case of security around an economy became very clear during the COVID-19 pandemic and going to business as usual has to be evaluated. The implementation of a circular economy with both small and large businesses will be the solution to reducing the impacts of an economic freeze created by global threats. Working together and putting aside stigmas associated with the circular economy will be the first step in building a strong foundation for a resilient circular economy in the United States.