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  • Cristian Cuta Gómez

Chile is Leading the Way as an Example of a Regional Circular Economy

Chile is a South American country with a population of about 19,49 million people. Its economy is diverse, with a strong emphasis on the export of natural resources such as copper, timber, and fruit. However, Chile, like many other countries, faces environmental issues such as air and water pollution, waste management, and deforestation. Chile has been implementing policies and initiatives to promote a more sustainable economy in response to these challenges.

The circular economy (CE) is an economic model that focuses on reducing, reusing, and recycling materials and products to reduce waste and maximise resource efficiency. In Chile, there are an increasing number of initiatives and projects related to the circular economy, particularly in agriculture, fishing, mining, and the fashion industry.

The Chilean case is not immune to the momentum that CE has gained in recent years. Many initiatives, led by the public and private sectors, have emerged in the country, covering a wide range of topics such as waste management, sustainable production and consumption, and renewable energy. This article will look at some of Chile's most significant CE developments.

Circular Economy Initiatives in the Public Sector

The Chilean Ministry of Environment established a Circular Economy Office to reduce the environmental impact of waste generation and promote a CE model. To that end, its two main areas of action are the implementation of Law 20,920, which establishes the framework for Waste Management, Extended Producer Responsibility (EPR), and the Promotion of Recycling; and catalysing an environment for innovation, a regulatory framework, and other instruments that allow the country to progress towards a more circular economic model.

The following are among the most outstanding initiatives within the public sector:

In 2019, the Ministry of Environment partnered with the Ministry of Economy, the Corporation for the Promotion of Production, and the Agency for Sustainability and Climate Change to initiate the development of the Roadmap for a Circular Chile by 2040, which was published in 2021. This collaborative process engaged a diverse range of stakeholders through various channels, such as four regional workshops, a Strategic Committee comprising 33 representatives from public, private, academic, and civil society sectors, and 11 thematic tables involving more than 140 participants. Additionally, a citizen consultation process was conducted for the document's preliminary version, allowing all contributors to offer suggestions and comments that ultimately enhanced the content of the roadmap.

The policy includes several recommendations to step up the CE, such as:

  • Create a national system for the management of waste and materials, which includes the development of a National Plan for the Prevention and Reduction of Waste, as well as measures to promote the use of recycled materials and circular design principles.

  • Develop a certification scheme for products and services that meet CE criteria, to promote sustainable consumption and production patterns.

  • Encourage the development of circular business models, such as product as a service, the sharing economy, and closed-loop systems.

  • Promote research, development and innovation in the CE, through financing and collaboration between universities, research centres and the private sector.

Circular Economy in the City:

Chile has begun to implement strategies for a CE in cities, such as encouraging community composting and building smart recycling centres. Santiago, for example, has launched a community composting programme that has recycled more than 20 tonnes of organic waste.

The Recycling and Extended Producer Responsibility Law, or REP, came into effect on May 17, 2016. This legislation mandates that manufacturers and importers of six priority products—including tyres, batteries, oils, and packaging—must recover a certain percentage of these items when they reach the end of their useful life and become waste. As a result, the law has fostered the creation of new businesses and spurred the development of innovative recycling technologies. Waste management is a major issue in Chile, where 7.6 million tonnes of waste are generated each year.

Circular Economy Initiatives in the Private Sector

Chile's private sector has also taken an active role in promoting CE. The private sector has helped to create alliances and collaborations to promote CE, such as the "Chile Circular" platform, which brings together businesses, academia, and civil society. Many businesses have adopted CE practices such as recycling, reusing, and waste reduction, as well as developing circular business models.

  • Project “Chile Circular”

The Chile Circular project aims to promote CE in the Valparaiso region by encouraging material reuse and recycling. Inspired by the concept of "industrial ecology," the platform seeks to create regional interconnections between various productive sectors, so that waste from one serves as raw material for another, fostering a virtuous circle. When fully developed, this virtual space will be able to stimulate commercial interactions between suppliers and applicants, resulting in a positive impact on the environment as well as economic savings.

  • Moda Circular Chile

The "Moda Circular Chile'' initiative promotes the production and consumption of sustainable and circular fashion in the country. They now offer a service for selling, buying second-hand, repairing, personalising, and exchanging clothing. Recycling initiatives such as Ropa x Hogar and Ropa x Ropa are added to this. It has received over 1,000 tonnes of clothing through this latest initiative, preventing it from ending up in landfills through reuse or recycling for various purposes.

  • Nestle's Zero Waste Program

Nestlé Chile has implemented a program called "Cero Residuos" (Zero Waste), which aims to achieve zero waste in landfills in its operations. The program includes measures such as the reduction of packaging waste, the promotion of recycling and the use of renewable energy.

Another example is the Gerdau AZA company, which manufactures steel products and has implemented a closed-loop system for steel production, in which all waste generated is reused or recycled during the manufacturing process.

Some Sectors of Highlight

Innovation in packaging:

Chilean companies are investing in the innovation of more sustainable and recyclable packaging. For example, the CCU, one of Chile's largest beverage companies, has introduced a beer bottle made with 30% recycled PET (polyethylene terephthalate) plastic. This innovative packaging solution not only reduces the company's reliance on virgin materials, but also lowers its carbon footprint by utilising post-consumer waste. CCU's efforts demonstrate its commitment to sustainability and contribute to the reduction of plastic pollution. Furthermore, Nestlé, a multinational food and beverage company with a strong presence in Chile, has recently launched a 100% recyclable water bottle. Nestlé's adoption of this sustainable packaging material underscores its dedication to reducing waste and promoting a CE.

Circular farming:

Agriculture is a crucial industry in Chile, and the concept of circular farming is gaining traction as a means to enhance the sector's sustainability. Circular farming encompasses various practices that promote a CE, aiming to reduce waste, increase efficiency, and minimise environmental impacts.

One example of circular farming is the use of organic waste as fertiliser. By transforming agricultural and food waste into nutrient-rich compost, farmers can avoid synthetic chemical fertilisers and reduce waste sent to landfills. This practice not only supports the health of the soil but also lowers greenhouse gas emissions.

Circular mining:

Mining plays a crucial role in Chile's economy, contributing significantly to the country's GDP and employment opportunities. With growing global concerns about the environment and resource depletion, the CE has emerged as an essential approach to enhancing the mining industry's sustainability in the country. Chilean mining companies have started adopting these principles, focusing on reducing waste, optimising resources, and minimising environmental impacts.

One prominent example is the state copper company Codelco, the world's largest producer of copper. Codelco has implemented various CE practices, including the efficient management of water resources. By investing in advanced water treatment technologies, the company has reduced its freshwater consumption and increased the reuse of process water in its operations. This practice significantly decreases the environmental impact and conserves valuable water resources in the arid regions of Chile where mining operations are prevalent.

The Years to Come in Chile's Circular Economy Development

These are just a few of the CE initiatives being developed in Chile; there are many more examples of companies implementing such practices and approaches. It is expected that progress in this economic model will continue in the coming years to achieve greater resource efficiency and reduce the environmental impacts of economic activity. To achieve virtuous transformations, organisations must undergo cultural change. The CEy implies a business model with a different approach, one that considers not only financial and technological variables but also the relationship with territorial actors and all those who are part of its value chain.


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