Speech: First Vice-President Timmermans' and Vice-President Katainen's opening remarks at the presentation of the Circular Economy package

Met dank overgenomen van F.C.G.M. (Frans) Timmermans i, gepubliceerd op woensdag 2 december 2015.

First Vice-President Timmermans:

Today we have adopted one of the major political initiatives of this Commission - a new package on the circular economy. With everything going on in Europe it might not draw everyone's attention immediately but I have to say I'm particularly proud of this package. I'm very happy to present it today with Jyrki, as this has been a real team effort of the whole Commission. We have worked on this with Commissioners Vella and Bienkowska directly. But many others have contributed. This is about reinventing the European economy and generating sustainable competitive advantages. In the preparation more than half the commissioners have been directly involved; and in the execution the whole Commission will be directly involved.

In this age of globalisation with huge demands on land, water, food, raw materials and energy, we need to go circular in the way we produce and consume. We can't rely any longer on the 'take, make, use and throw away' approach. We need to decouple economic growth from resource consumption. This can be done in a circular economy, where materials are re-injected into the economy instead of being landfilled or incinerated.

This can save around 500 billion tons of greenhouse gas emissions by 2035. Something that I think is worth keeping in mind as we all hope for a global deal for climate change in Paris next week.

Making the switch from a linear to a circular economy is not just the right thing to do for our environment; it's also the smart thing for Europe to do. We cannot compete on wage costs; we cannot compete on cheap natural resources as other parts of the world could. But with resource efficiency, leadership in green technologies and modern waste management, we can build a competitive edge, generate new business opportunities and create jobs. Creative initiatives by businesses and citizens already show it; and there are more and more examples, whether it's car sharing, repair cafés, or green packaging. So the question is not whether we will go circular but how fast we will go circular. With our initiative today we want to accelerate this transition that has already started.

The package we are putting on the table offers a very comprehensive set of measures to, as it were, "close the loop" in Europe with concrete steps covering the full lifecycle of products, not just the waste phase. Only this all-embracing approach can provide the strong push that we need.

Through these measures we will encourage smarter design of products to improve their durability, reparability and recyclability. We will foster resource efficient production processes that minimise waste; help waste or by-products of one industry becoming inputs for another industry; and facilitate better informed consumption choices with information on the durability of products. And we will also support the development of a thriving market for secondary raw materials. We are backing up these proposals with financial instruments and funds - €650 million from Horizon 2020 and €5.5 billion from structural funds from now to 2020.

I want to briefly highlight a few actions.

The issue of planned obsolescence of products is one thing I'm serious about looking into. Products designed to fail immediately after the warranty period expires - this is something we need to be tough about. I want to seriously look into this.

Another concern: plastics; less than 25% of collected plastic is recycled. They end up in our oceans and are not biodegradable or easily recyclable. So we will develop a strategy to tackle this and reduce marine litter significantly.

Food waste is a priority area where we want rapid change. It is economically, socially and quite simply morally inacceptable that one third of the food worldwide is wasted. We want to halve food waste by 2030 - in full line with the Sustainable Development Goals (SDG) - and will facilitate food donation and look at date marking, in particular the "best before label".

Modern waste management is also key. We have looked at the smartest way to make real progress on the ground across Europe so that no Member State is left behind. In setting the world's most ambitious recycling and landfilling targets, we give a clear signal to investors and offer predictability to businesses.

We propose an EU-wide target for 65% of all municipal waste and 75% of all packaging waste to be recycled by 2030. Unlike the previous Commission, we combine this with a very strict target of a maximum of 10% of all waste to end up in landfill by 2030. Prioritising the reduction of landfill is what we need to boost recycling. Putting stuff in the ground is losing it for recycling while it pollutes the environment.

And we will be monitoring the progress step by step, all the time, so we can also adapt. If we're successful we can create higher standards; if we make a success, we can go beyond those targets.

Member States will also have to make greater use of economic instruments - such as landfill taxes and incineration charges. This has proved to be a very effective instrument on the ground. As long as landfilling is a cheap option, it is an option a local mayor will not give up on. And we also have to be careful that diminishing landfill does not lead to only looking to the cheap option of incineration - so we need to really do this on a step by step long term basis so that investors can depend on a consistent policy from our side.

The diversity of starting points among EU Member States - 64% of recycling in some, 10% in others - is huge. But with the backing of our action plan and funding, we believe the pathway is feasible. If progress is steady, we will review the targets in 2025 to increase to 70% of municipal recycling.

In sum, what we have put on the table is the solid and comprehensive EU-wide framework that was missing until now to speed up the move towards a circular economy. It will only work if it is done "full circle"; by just going for a part of it, we will never reach the goal we want.

Vice-President Katainen:

Thank you Frans. I also want to thank Commissioner Vella and Commissioner Bieńkowska and all the other services who have contributed to this package. Many people have asked me how the new Commission structure functions and what the role of Vice Presidents is. This is an excellent example of how the new structure functions. The old way to deal with these kind of proposals was that one DG prepared things and the proposal was presented to the others at the end of the process. But now we include everybody, and everybody has a chance to contribute. This is one of the reasons why we now have a more comprehensive approach to the circular economy. I'm very happy with the content but also the process which led us to this.

The circular economy will be a global mega-trend in market economy. You can compare circular economy to globalisation which we have witnessed during the last couple decades. We are talking about the new logic of product market. During the process we have listened to thousands of people, and I must say that we have learned a lot. I also want to thank all the stakeholders who participated in various events and contributed to the work. This has been essential for our work and for us to understand the new opportunities but also the restrictions.

The circular economy is a crucial part of the Investment Plan. This is about the Single Market. So the circular economy is a Single Market package, but also a competitiveness package. This is about empowering consumers and encouraging businesses to move from inefficient linear economy to the circular market economy.

This package is the beginning of the story. It will not transform the European economy from linear to circular in one go overnight. But this is a good start, and now we have a structure which we can complement later on. The action plan, which is the second part of the proposal, the first one is the legislative proposal on recycling targets and landfill targets but the action plan is another part, will complement the waste proposal.

There are plenty of proposals, from product design to creating an internal market for secondary raw materials and to support industrial symbiosis by recognising the value of bio-products. As Frans already described, the measures in the Action Plan are as important as the other legislative proposals.

The key objective here is to work on further deepening the EU Single Market which is also the most important part of the Investment Plan for Europe. This matters as there are barriers that make it difficult for businesses to optimise their resource use. This is why creating a market for secondary raw materials and ensuring reliable quality standard is crucial: it is fundamentally about broadening our Internal Market.

It's also essential to integrate the reparability, durability, and recyclability of products right from the start of the thinking process of their design. Ecodesign framework, which we already have, is a tool to strengthen the development where products are easier to repair, dismantle and recycle. In our new package, our aim is to broaden the scope of Ecodesign from energy efficiency to resource efficiency. We will propose criteria on electronic displays very shortly. The Ecodesign tool is a very efficient tool for consumers. As I said earlier, our aim is to empower consumers and ensure a level playing field for businesses.

I would like to add a couple of issues to what Frans already described on the action plan. For instance, revised regulation on fertilisers has a big impact on the circular economy. Our aim is recognise organic and waste-based fertilisers and support bio-nutrition. Also we will give a legislative proposal on a minimum standard for re-used water for irrigation purposes. Public authorities, starting with the Commission, will be encouraged to step up on the uptake of circular economy criteria in public procurement. This has great potential for the circular economy as public procurements makes up nearly 20% of EU GDP. We will therefore emphasise circular economy aspects in new or revised criteria for Green Public Procurements, and the Commission will lead by example.

Finally, we have plenty of resources to help member states and the private sector to transform their behaviour towards the circular economy. Frans already mentioned resources which are dedicated to this purpose from Horizon 2020, 650m Euros. You have to account for opportunities from EFSI too, if there are investments, and the combination of EFSI, Horizon 2020 and structural funds can really investors to invest in this area.

So I will conclude by saying this package will achieve economic, environmental and societal gains and benefits. There are always two extreme groups which criticise these kinds of proposals. The first group says that we aren't doing enough, the other group says that we are doing too much. But our message is that there's plenty of room in the middle for moderate people who want to get real results and who want to create a market economy that's more sustainable for people and for the environment.

So let's give consumers an opportunity to lead the transformation by their choices, and let's strengthen competitiveness and strengthen incentives for businesses to change their business models towards the circular economy. Thank you.

SPEECH/15/6238

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