Environment: from the circular economy, the raw materials Italy lacks

There is a shortage of many raw materials and when these can be found, prices are exorbitant.   The causes are varied: the growing increase in demand; the climate crisis, which diminishes the capacity of ecosystems to provide resources and intensifies certain needs; the pandemic, which has imposed a lengthy setback on the global economy; and the conflict in Ukraine, which has exacerbated Europe’s energy fragility. The solution exists and is called the circular economy. But it has not taken off yet.

The global data are clear from this standpoint: from 2018 to 2020, the circularity rate fell from 9.1% to 8.6%. Over the last five years, consumption has increased by more than 8% (exceeding 100 billion tonnes of raw material used each year), compared with an increase in reuse of just 3% (from 8.4 to 8.65 billion tonnes): we are still wasting a large share of the materials extracted from the ecosystem.

We have not reversed our course. Italy, too, has failed to decouple economic growth from resource use. This means that GDP and material consumption move in parallel: the 2021 recovery shows that the two values are returning to the same levels as prior to the pandemic. Yet Italy is one of the countries “holding steady”: within the framework of Europe’s top five economies, it ranks first for the most important indicators of circularity, along with France.

This is what emerges from the National Report on the Circular Economy in Italy 2022, now in its fourth edition. The study was carried out by CEN (Circular Economy Network), a network sponsored by the Foundation for Sustainable Development and a group of companies and associations, in partnership with ENEA.

“The climate crisis and dramatic events of the last two years, with a run-up in the price of many raw materials, show that the time to wait is over. It is time to launch European policies supporting the circular economy without further delay”, declared CEN President Edo Ronchi. “Our economies are fragile because strategically, they depend on raw materials largely located in a restricted group of countries. It is an issue that threatens not only to stifle the recovery but to destabilise the entire economy with an inflationary spiral. That is where the circular economy can make a difference, by finding within the country those resources that are increasingly expensive to import. Italy’s goal must be to achieve the decoupling of growth from resource consumption”.

“Industrial symbiosis is one of the most powerful tools we can use to support the circular transition of our productive systems, with widespread environmental, economic and social advantages”, stated Roberto Morabito, director of the ENEA Department for Sustainability. “As occurs in other countries, it is more important than ever for Italy to develop a national program for industrial symbiosis to maximise its potential and ensure the traceability and accounting of exchanged resources. The potential economic advantage of resource exchange in Europe is estimated to total 7 to 13 billion euros, with an additional 70 billion in savings from reduced landfill costs. Since 2010, ENEA has developed a platform and work methodology that have enabled projects to be carried out with more than 240 companies and identified about 2,000 potential resource transfers between them”.

An average of roughly 13 tonnes of materials was consumed per capita in Europe in 2020. But substantial differences persisted between the five major economies at the centre of the report’s analysis (Italy, France, Germany, Poland, Spain): from 7.4 tonnes per inhabitant in Italy to 17.5 tonnes per inhabitant in Poland. Germany totals 13.4 tonnes; France 8.1 tonnes; and Spain 10.3 tonnes.

In 2020, none of the five European countries under examination increased their resource productivity. Each kg of resources consumed generated 2.1 euros in GDP (PPP) in Europe in 2020. Italy generated 3.5 euros in GDP per kg (60% higher than the EU average).

The utilisation rate of recycled material measures the ratio of recycled materials to total demand for materials. In 2020, the most recent year for which data is available, the utilisation rate of recycled material in the EU measured 12.8%. That same year, the rate reached 21.6% in Italy, second only to France’s rate (22.2%) and more than 8 percentage points higher than Germany’s (13.4%). Spain (11.2%) and Poland (9.9%) ranked fourth and fifth, respectively.

Positive news awaits Italy on the waste front, as well. In Italy, the recycling rate for all waste has reached almost 68%: the highest figure in the European Union. Of the five economies observed, Italy recycled the largest share of special waste (from industry and companies) in 2018: about 75%. As regards urban waste (10% of the total waste generated in the European Union), the recycling target is 55% in 2025, 60% in 2030 and 65% in 2035. In 2020, 47.8% of all urban waste was recycled in the EU 27; in Italy, 54.4%. That year, the percentage of urban waste sent to landfills throughout the EU totalled 22.8%. The best-performing countries, after Germany, were France (18%) and Italy (20.1%).

Yet several sectors pose clear difficulties for Italy. One is land consumption: in 2018, 4.2% of EU 27 territory was covered by artificial surfacing. Poland reached 3.6%; Spain, 3.7%; France, 5.6%; Italy 7.1%; and Germany, 7.6%. We also place near the bottom in terms of eco-innovation. Italy ranked 13th in the EU for investment in the sector in 2021, with an index of 79. Germany’s index was 154. Finally, the repair of goods. More than 23,000 companies carried out repairs of electronic and other personal goods (clothing, footwear, watches, jewellery, furniture, etc.) in Italy in 2019. We are behind France (over 33,700 companies) and Spain (just over 28,300). Since 2010, we have lost nearly 5,000 companies (about 20%) in this sector.

Overall, Italy and France appear to be the highest performers in terms of circularity, with 19 points each. In second place is Spain, with 16 points. At 12 and 11 points, respectively, the circularity performance indexes of Poland and Germany are considerably lower.

The National Recovery and Resilience Plan (PNRR, Piano nazionale di ripresa e resilienza) sets out two general objectives for the circular economy: first, to improve the performance of the recycling chain through interventions to increase the recovery of secondary raw materials; second, to implement the circular economy paradigm, reducing the reliance on raw materials the country lacks and gradually replacing them with secondary raw materials.

The resources directly designated for the circular economy in Mission 2 (Green Revolution and Ecological Transition), Component 1 (Circular Economy and Sustainable Agriculture) total 2.1 billion euros. In other areas of the NRR, there are additional investments that could contribute to the development of the circular economy.

The 4th CEN Report monitors trends in the circular economy through the innovative application of indicators based on the Bellagio Charter, a European system for monitoring the circular economy. Such measurement contributes to the objectives of the EU’s new Circular Economy Action Plan, which requires precise assessments of how the circular economy is evolving. The National Strategy for the Circular Economy will enter into force in 2022. This report aims at fostering debate on the subject with a special emphasis on the 2021 trends. While evidencing, on the one hand, a stronger-than-expected economic recovery, on the other they reveal significant growth in resource consumption.