FEAD fully supports the need for financial incentives to achieve the shared priorities outlined in the Competitiveness Compass, particularly through the proposed Competitiveness Fund. Financial incentives are crucial to drive investments in innovation and sustainable practices and this must include the circular economy objective of the new Commission.
While the new Circular Economy Act should serve to catalyse investment in recycling capacity and encourage the EU industry to effectively substitute virgin materials, financial support will be needed to push this transition. As identified by Mario Draghi, we are parting from a reality in which virgin raw materials are cheaper than recycled raw materials, at the cost of the environment and climate. For Enrico Letta, the future of our single market includes a Circular Single Market, whose foundation ‘lies in ensuring a level playing field for circular materials, products, and services’.
To achieve this level playing field and turn over the current reality without making products more expensive for consumers, a strong political signal and concrete measures will be needed. The European recycling sector is suffering a crisis that paradoxically coincides with the recent adoption of ambitious legislation to support the circular economy. The fact is that the European Commission has identified an investment gap of 27 billion euro for the circular economy. That is why FEAD strongly advocates for a Circular Economy Fund, in addition to other policy measures, to support the transition away from primary raw materials, ensuring that Europe’s strategic autonomy is reinforced, while contributing to the EU’s green and digital transition.
The circular economy is a crucial part of the EU’s competitiveness agenda to achieve decarbonisation and material autonomy, and this must be backed by actions, including a dedicated budget line from the future European Competitiveness Fund: the Circular Economy Fund.
‘FEAD stands ready to work closely with the European Commission to translate the Competitiveness Compass into actionable measures that support a competitive, sustainable, and circular European Single Market’, said Claudia Mensi, President of FEAD.