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What is the circular economy? Building a new future for the industry with Circular economy principles

  • The circular economy has evolved from the “3R” model to the “5R” approach. It is reshaping industries by focusing beyond Repairing, Reusing, and Recycling.
  • Projects like CIRCULOOS, Wasabi, AI Redgio 5.0, and AIRISE are innovating in circular practices, leveraging digital tools and AI to empower SMEs and reduce waste.
  • Platforms like the European Cluster Collaboration Platform and the Circular Economy Stakeholders Platform are fostering collaboration and networking among organisations committed to advancing the circular economy, paving the way to a greener future.


How many actions can humans take to fight the climate emergency? It is about adopting a whole new lifestyle. Starting with the industries. At this point, you probably have heard about the circular economy, often called the “3R” model: Reduce, Reuse, and Recycle. Now, it has come to the 5R model, which is a standard classification of strategies to foster the European Commission’s concept referred to as the 5 R-strategies, so-called Repair, Reuse, Recycle, Refurbish, Remanufacture, and Repurpose, which extend the lifetime of products and their parts to avoid waste.

According to the The Circularity Gap Report 2023, with a circular economy, we could fulfil people’s needs with just 70% of the materials we currently use—within the safe limits of the planet. Thus, the European Parliament has described the circular economy as a production and consumption model that holds the key to a more sustainable future. When a product ends its life, its materials are kept within the economy wherever possible, thanks to recycling. These can be productively used again and again, thereby creating further value.  As the President of the European Investment Bank, Dr. Werner Hoyer quoted:

“Fighting global warming and environmental crises is the most urgent challenge of our time. Strengthening the circular economy is one of the most powerful tools in our arsenal. It will help achieve the Paris Agreement targets and bring huge benefits to the economy and society. With the Joint Initiative on Circular Economy, we are scaling up our ambition and joining forces with our peers to stem the tide of waste.”

The European circular economy projects that will transform the manufacturing sector

At a European level, several initiatives are tackling this problem. For instance, CIRCULOOS is a project financed by the European Commission that focuses on assisting micro, small, and  medium-sized production companies to redefine their supply chains through circular economy principles. CIRCULOOS aims at a case-driven framework that leverages digital tools and circular supply chain models. These tools are built upon collaborations among commercial entities, fostering innovation and sustainable practices. CIRCULOOS encourages participating companies to adopt circular economy principles through the project’s pilots and open calls.

CIRCULOOS focuses mainly on these R-scenarios, which require active and real-time collaboration between multiple actors. Usually, different SMEs are responsible for each R-scenario. To effectively restructure the production process, new agreements need to be established, based on data-sharing policies. CIRCULOOS’ data management and AI-based tools deliver this value through the RAMP platform to explore the circular value behind inter-organisational cooperation and organisational mapping.

Under the Horizon Europe Call for Climate Neutral, Circular and Digitised Production 2022, CIRCULOOS received, th ree more initiatives did so, and are now working to accelerate the adoption of circular economy practices:

  • Wasabi: It is a project that boosts manufacturing through AI collaboration, improving worker skills with Natural Language Processing. It helps small manufacturers in Europe navigate sustainability challenges. By making AI accessible and affordable, it enhances innovation, making these companies more competitive and sustainable.
  • AI REDGIO 5.0: It focuses on renovating and extending the alliance between Vanguard European regions and Digital Innovation Hubs, considering the outcomes of H2020 I4MS AI REGIO and implementing a competitive AI-at-the-Edge Digital Transformation of Industry 5.0 Manufacturing Small and Medium Enterprises.
  • AIRISE: It promotes the increased use of Artificial Intelligence in manufacturing. Our primary focus is on empowering small and medium-sized enterprises (SMEs) on the adoption of AI, by enhancing their skills and capabilities. The AIRISE ecosystem offers a comprehensive range of services, ranging from scientific support across shop-floor deployment support to skills and education on the use of AI in manufacturing. The key objective is a reduction of waste and carbon footprint while ensuring resilient production.

In addition to these projects, other EU-funded initiatives are driving progress toward a circular economy:

  • Better Factory: It provides a methodology for manufacturing SMEs to collaborate with artists to develop new and personalised products. At the same time, it supplies technology for SMEs to become cyber-physical systems, transforming them into Lean-agile production facilities capable of manufacturing unique and personalised products along with existing ones.
  • New Wave project: It aims to promote a circular economy by incorporating sustainable raw materials into four manufacturing processes. This involves substituting harmful chemicals and reducing the environmental impact of products. The project’s unique method involves using Thermo-Chemical Fractionation (TCF) to break down and separate residual biomass. TCF combines fast pyrolysis to convert biomass into fast pyrolysis bio-oil (FPBO) with a subsequent liquid-liquid extraction process, resulting in depolymerised fractions with distinct chemical properties.

Organisations that will lead transformation

Furthermore, European platforms such as the European Cluster Collaboration Platform and the Circular Economy Stakeholders Platform,they provide vital resources and networking opportunities for organisations committed to advancing the circular economy.

On the one hand, the European Cluster Collaboration platform wants to be the European online hub for cluster stakeholders (cluster organisations, policymakers, and other related stakeholders from the cluster ecosystem) and the reference one-stop-shop for stakeholders in third countries aiming to set up partnerships with European counterparts. On the other hand, the Circular Economy Stakeholders Platform goes beyond sectorial activities and highlights cross-sector opportunities. It also provides a meeting place for stakeholders to share and scale up practical solutions and address specific challenges. The Platform bridges existing initiatives at the local, regional, and national levels and supports implementing the circular economy.

A circular economy in the manufacturing sector represents a fundamental shift in how production and consumption are approached. As the world faces climate emergencies, initiatives like CIRCULOOS and their counterparts lead toward a more sustainable and respectful European industrial landscape. By reducing waste, reusing materials, and recycling resources, these projects pave the way for a brighter and greener future, one circular step at a time.

Clara Pont
Mobile World Capital Barcelona, EU Projects Communications Executive