Resilient People and Places: Why cities should embrace the circular economy to shape our post-COVID-19 future

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This article is part of a series in which OECD experts and thought leaders – from around the world and all parts of society – address the COVID-19 crisis, discussing and developing solutions now and for the future.

To keep updated on all of the OECD's work supporting the fight against COVID-19, visit our Digital Content Hub.

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COVID-19 has put the world on standby unlike any other economic, social and climate crises. On average, OECD economies are expected to contract by 2% per month of confinement, which will result in a very significant GDP loss for 2020, and millions of people have already lost their jobs (OECD, 2020). With 50% of the world’s population confined across 90 countries, our world has come to a near standstill.

This unprecedented crisis is also highlighting the unsustainable nature of certain environmental and social trends. The pandemic has led to a drastic reduction in the use of fossil fuels and could lead to an 8% drop in carbon dioxide emissions globally in 2020, the lowest in decades (International Energy Agency, 2020). Do we really want to go back to “business as usual”? As the 2008 global financial crisis revealed, drops in greenhouse gas emissions can be reverted in a very short timeframe. Once again, rapid economy recovery may overshadow environmental objectives.

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We all know that climate change will have a detrimental effect on economic activities and people’s lives. Yet, in practice, what are we doing individually and collectively to ensure there is no ‘going back’? Why is it so hard to shift from short-term responses to long-term risk management?

There is perhaps a silver lining. It is time to reconsider the way we think, make decisions, behave, work, move, produce and consume towards a green recovery, one that provides income, while tackling climate change. This is especially true in cities where most of the world population live and work – accounting for up to 80% of greenhouse gas emissions, two-thirds of total energy demand, and 50% of waste generation. If we want radical change, we should reflect on the limitations of our current linear economy which takes, makes, and wastes resources and pursues economic growth at the expense of environmental quality. A more circular economy creates value, while reducing the environmental impact of the use of resources and waste disposal.

The circular economy might not be a panacea for all the megatrends cities will be facing in the future, nor a response to the current health crisis. However, it can help address unsustainable trends and find adequate solutions. In particular, cities have a role to play in closing the loops, reducing waste, reusing resources and restoring ecosystems alongside long-term recovery measures for more resilient, sustainable and thriving societies.

Now is the time for a strong, sustainable and inclusive recovery by Dimitri Zenghelis and Nick Stern, Grantham Research Institute

Can COVID-19 accelerate the transition towards a circular economy in cities? How?

First: Take action before another crisis hits. The rapid spread and unknown projections of COVID-19 took the world by surprise, resulting in a great deal of uncertainty. Less uncertain is that by 2050, nine billion people will live on the planet, 70% of whom are projected to live and work in cities, with impacts in terms of CO2 emissions, waste production and resource consumption. More people means increased demand for water, food, energy, land and housing infrastructure, with the impacts of climate change affecting both the quantity and quality of natural resources. So far, bold responses to prevent what could become a social and economic crisis are marginal, mainly because the benefits of reducing the impacts of climate change and using resources more efficiently are inadequately perceived as global, distant and not urgent.

Read the OECD policy brief Environmental health and strengthening resilience to pandemics and more on Environment & Climate

Second: Turn the crisis into opportunity. The pandemic and its aftermath represent an opportunity to improve people’s lives and stimulate innovation: from the extensive use of digital solutions, to decentralised production, remanufacturing, and restructuring of supply chains to respond to goods shortages. Civic duty and community involvement are prevailing over individual interest to protect vulnerable groups. This can inspire lasting behavioural shifts to make cities more resilient, circular, and more efficiently connected with rural areas, in terms of the way goods are produced, the energy consumed and transport organised. This will ultimately reduce the vulnerability of economic and social systems.

Third: Embrace the new normal. The COVID-19 crisis has increased worries about food and energy security, reliable access to water, and the future of transport. The circular economy has the potential to become the new normal in cities. Human-centred cities could reduce private car use and regenerate green spaces. Organic waste could be transformed into high quality fertiliser for local food production in rural areas. Buildings, made of traceable and recyclable materials, could absorb carbon dioxide, treat wastewater and produce energy.

A circular city is not a utopia and it is within reach. With a combination of natural and technological loops, incentives to create projects and profitable investment, conducive regulations, and strong links with rural areas, we can all promote a cultural shift towards a more resourceful and less wasteful society. This will help ensure that people and places are more resilient today and in the future.

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Tackling COVID-19 Sustainable Development Goals

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Go to the profile of Oriana Romano

Oriana Romano

Head of Unit, Water Governance and Circular Economy, CFE, OECD

Dr Oriana Romano is the Head of Unit, Water Governance and Circular Economy in Cities in the OECD Centre for Entrepreneurship, SMEs, Cities and Regions. She set up the OECD Programme on the Circular Economy in Cities and Regions, supporting governments towards the transition to the circular economy. She has led multiple circular economy policy dialogues and created the OECD Roundtable on the Circular Economy in Cities and Regions.

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