Japan lacks courage in its update to Circular Economy Vision 2020

In May 2020, Japan updated its Circular Economy Vision to respond to the failings of the linear economy model and growing demand for global markets and society to factor in environmental concerns. While changes include an outlook for developments in digital technology to boost the efficiency of resource use, it is a placid plan that lacks teeth, courage and urgency.

Background to the Circular Economy Vision

In 1999, Japan’s Ministry of Economy, Trade and Industry (METI) created the Circular Economy Vision as one of the first commitments around the world to reduce industrial waste and limit the use of natural resources. In the 1999 Circular Economy Vision, the 3Rs were introduced as a key principle to create a circular economy. “3R” stands for Reduce, Reuse, and Recycle.

Thanks to the introduction of the 1999 CEV, Japan made the following achievements:

• Improvement of the legal system, including systems and funding for extended producer responsibility for products
• Reduction of waste generation and improvement of the recycling rate
• Expansion of environment-related businesses

Transition to Circular Economy Vision 2020

However, despite the introduction of the Circular Economy Vision 20 years ago, Japan is still far from achieving the goal. METI has revised its planned strategies and the stepping stones to creating a circular economy. In CEV 2020, it expands its view to include emerging global-scale issues related to limited resources such as biomass, fossil fuels, and metals.

The existing, linear economic model based on mass production and mass consumption has boosted the global economy. However, its potential is limited simply because there are physical limits to resources. People worldwide have realized this existential pitfall of the linear economy model and that it can no longer be ignored. Therefore, stakeholder-capitalism, which focuses on short-term financial interests, needs to be transformed into a model that achieves mid- and long-term prosperity. But is it feasible to shift the linear economy model toward a circular one? There is evidence that it is.

Circular Economy Vision 2020

The main principles from the Circular Economy Vision 2020 are as follows:

• A shift from 3R as environmental action to 3R as economic action
• Support for voluntary actions by companies that are motivated by global market demand to offer circular products and services (minimum use of regulatory measures)
• Construction of a resilient circular system for mid- and long- term economy growth

Unfortunately, these principles do not imply a sturdy resolve by the Japanese government to create a circular economy. The 1999 CEV spent twenty years focused on 3R and Japan is still far from being a circular economy. The lack of significant change in this new document means it will take at least another twenty years to achieve the goal, and that is too slow.

Especially, METI takes the stance that the transition away from the conventional business model depends on each enterprise’s motivation. Therefore, Japan will encourage companies to take action but won’t push regulatory measures onto them because it fears that doing so would hinder their international competitiveness. Rather, the main driving force for the change that METI naively envisages is the “judgment” of global society. This is concerning; just believing in corporate goodwill is not a strong enough, or urgent enough, approach because business, by its nature, seeks profit rather than the greater good.

More regulation is needed to make a drastic change in the business model. For instance, one of the main materials targeted for reduction is plastic. Introducing fees for plastic bags provided in shops is by far the biggest action that has been implemented, but how about taxing packaging for food? What about considering banning plastic bags completely?

Backlash and criticism are inevitable when you try to change something drastically, but what Japan needs now is to have the courage to try new approaches and not be afraid of making an error. It needs to be brave enough to accept criticism, instead of aiming just to follow and appease the judgement of global society.

What can we do as individuals to achieve a Circular Economy?

Have you ever heard of the Japanese term “Sanpo-yoshi”? It is a principle that was widely practiced among merchants in Shiga Prefecture (near Kyoto) during the Edo era (1603-1868). Sanpo-yoshi refers to realizing a satisfying transaction for all three parties involved: “Good for the seller, good for the buyer, and good for society.” This philosophy enabled enterprises to not only seek profit for themselves, but also to act in accordance with the importance of the close connection between private and public benefit to maintain trust between the stakeholders and a circular economy.

Each of us is responsible for our actions and has a role to play in determining the long-term success of a circular economy. As stated in CEV 2020, increasing societal and market-driven demand for environmentally friendly products plays a key role. It indicates that changing our behavior in daily life can lead to greater change on a larger scale.

If consumers say “no” to plastic bags and packaging, there will be no demand for them, and therefore no production of them. While it is not exactly that simple, our actions do create social change. For example, you probably cannot think of the name of a company that even now produces old-style dial phones. That is because there probably are none. And that is because no one wants to buy them anymore. Consumers have decided to stop using those phones and use smartphones and cellphones instead. Consequently, no new dial phones need to be produced anymore. This mechanism works for almost all kinds of markets.

The point is that we can change the capitalistic economic system into a circular economy system by choosing more eco-friendly products and services. The more consistent we are in doing that, the faster we will push companies to conform to our values.