Viewpoint - David Fitzsimons

“Europe has to decide what it is prepared to do to defend its nascent circular economy” - David Fitzsimons

“There is a great deal of talk about policies to favour remanufacturing at the global level – but the day-to-day experience of doing business in the circular economy might tell a different story. When German politician Ursula von der Leyen, president-elect of the European Commission, voiced her support in the European Parliament for the introduction of carbon border taxes she was also acknowledging that Europe’s circular economy is under a renewed threat.

I say ‘renewed’ because the threat is hardly a new one - the open import of products designed for a single and short life, which are also incapable of being remanufactured or refurbished. But when combined with a price based on the marginal costs of over production and non-compliance with CE markings, the certain outcome is the closure of businesses that are providing the much-praised quality of product value retention.

Javier Martinez, the new president of ETIRA, a printer cartridge trade association, said in Barcelona recently that Europe had to decide what it is prepared to do to defend its nascent circular economy. His evidence was a screenshot of a wholesale price list in which an OEM-branded product priced at €80 was compared to a remanufactured version at €55 and a budget product at €15. The budget product displayed a CE marking to indicate that it complied with all European regulatory requirements.

The rules of international trade are now being redrawn in the cause of “making America great again”. Ursula von der Leyen’s response is: “Let’s make the environment great again” - but the proposal of carbon border taxes is so complex it will tie up officials for years and delay the application of more pragmatic policies.

For example, if CE markings are being abused, there are existing rules that can be enforced by European Union member states. Enforce them. If product is being priced at marginal cost there are existing World Trade Organisation rules to be applied and enforced. Use them. And whilst this pragmatic work is being done to defend remanufacturers who are central to the circular economy there is also a much larger task to do of redrafting our global trading rules - which have so successfully driven down consumer prices at the expense of so much else.

David Fitzsimons
Director
European Remanufacturing Council