Circular Economy: Consumer decisions have an enormous impact on transition

By Miyelani Mkhabela Time of article published Dec 18, 2019

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PART II: JOHANNESBURG – Consumer decisions have an enormous impact on the transition to a circular economy, and consumers need to be empowered with consumer rights and access to reliable information to be able to play their role in the circular economy to the full extent.

South African government must adopt a Circular Economy and develop a circular economy Action Plan to boost economic expansion, jobs, growth and investment and to develop a carbon-neutral, resource-efficient and competitive economy. The actions under the action plan must have a completed or are expected to be smartly implemented, even if work on some will continue beyond 2030 or 2040. 

All these activities will contribute to a global effort in pursuit of the Sustainable Development Goals, in particular, SDG12 on sustainable production and consumption. The South African mining industry needs to adopt the circular economy precisely for the harm they caused and also remorse of caring to society and communities they have been doing business for more than 100 years. Citizenship has a huge responsibility for caring and building a sustainable environment for the future. 

READ: How we design, produce, use and discard products impacts our economy

South Africa must create policies that contribute to the transition to a circular economy by influencing how products should be designed, produced, used or treated at their end-of-life. Given the diversity in products, which include technologies and services, these policies are necessarily also diverse as they address different product groups, environmental impacts and phases of the product life cycle, and have diverse objectives and methods to achieve them.

Innovation is essential to facilitate the transition to a circular economy. Innovations aimed at more sustainable practices, processes and products are referred to as eco-innovations. The South African government and Department of Science and Innovation has a huge responsibility to supports many such innovations through research programs from 2020 in partnership with the European Union showing interest in working with Africa and move ahead smartly with speed. 

Research confirms that there is about 120 trillion USD under management by institutional investors globally and more funding will be required to finance unlisted investments that’s impact compliant, attractive project preparation and commercially viable.

The South African product policy framework must encompass the Africa Trade Agreements and trading partners such as leading emerging markets and developed economies as part of our trading partners from different markets. The broad market will help in inter-trade relations for the greatest achievements of the South African circular economy project.

The basic concept of GPP relies on having clear, verifiable, justifiable and ambitious environmental criteria for products and services, based on a life-cycle approach and scientific evidence base, for inclusion in the public procurement process. The South African government in partnership with the number of European countries can develop guidance in this area, in the form of national GPP criteria. The criteria used by member states should be similar to avoid a distortion of the single market and a reduction of South African wide competition with its global trading partners.

The Extended Producer Responsibility (EPR) is an important component mainly to keep producers responsible for the future damage they can cause to the environment and the approach to ensure that producers contribute financially to the costs of waste management; it is thus also an economic instrument to stimulate better design to reduce such costs. The ERP puts an obligation on producers to take operational or financial responsibility for the end-of-life phase of their products. For electrical and electronic equipment, end-of-life vehicles or batteries, EPR schemes must be required by the relevant South African agency ensuring sustainable standards with that industry.

South Africa must also revise environmental and Waste Framework Directive to sets new general minimum requirements for EPR schemes to improve their effectiveness and performance across the value chain and our markets. These requirements specify, inter alia, the costs that should be covered by producers, including costs of separate waste collection, its transport and treatment, as well as costs of providing information to the waste holders and the costs of monitoring and reporting. Also, the requirements set an obligation for collective schemes to modulate the financial contributions paid by producers for their products or groups of similar products, taking into account their durability, reparability, reusability and recyclability and the presence of hazardous substances, thereby taking a life-cycle approach. 

In a circular economy, products and their materials pass through different loops that aim to maintain the potential of products and materials to create value. Many products owned by consumers are not used to full potential during their economic lifespan. Examples include cars, which on average are parked for 78% of their lifetime and when used transport on average just 1,5 person; tools, which are only used occasionally by the average owner; and buildings, most of which serve either residential or commercial/industrial purposes and are therefore in actual use for a small part of the time. Collaborative practices and business models aim to harness the unused potential. Digitalization is providing for the necessary platforms for such Models.

Miyelani Mkhabela is an economist, a director of Antswisa Transaction Advisory Services and Antswisa Private Equity. [email protected]


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