This paper - part of the A Circular Economy Vision series - follows one of Circular Innovation Lab's previous analyses of the potential effects of the European Critical Raw Materials Regulation (ECRMR) on developing economies.

It focuses on the EU’s domestic critical raw material (CRM) markets, revealing how the current hyperfocus of the policy on extraction, processing and recycling is not applicable to all identified CRMs. By analysing the limits of the ECRMR as it stands, the paper argues that a supporting structure of circular economy legislation could promote a successful ECRMR for all CRMs, not just those that could benefit from recycling infrastructure.

The paper provides detailed policy recommendations for each CRM where data allow.

As the world transitions to green energy and greater technology use, critical raw materials (CRMs) are the new frontier of economic and political disputes.

The EU has recognised this threat to supply chains, passing the European Critical Raw Materials Regulation to help stabilise EU access to CRMs. Published in March 2023, the regulation seeks to improve EU extraction, processing and recycling capacity with minimal reliance on other states. However, the EU has limited sources of many CRMs, and so strategic projects in third countries will be utilised to ensure that EU demand is met.

This paper discusses the possible impact of this regulation on developing economies, exploring how they will be affected by strategic projects, shifting EU import demand, and circularity incentives.

This Sitra memorandum focuses on providing building blocks to help the next European Commission address the ecological crisis while maintaining Europe's competitiveness and resilience.

The renewed European Commission will take office in 2024 and must keep up the European Green Deal, ensuring that it centres on nature and mainstreams the circular economy across the EU single market.

The key recommendations include:

• ecosystem accounting
• biodiversity offsets
• circular single market
• leveraging nature as a business opportunity
• using data for the green transition
• addressing Europe's global biodiversity footprint, and
• reforming the common agricultural policy.

Stakeholders are encouraged to contribute to the ongoing debate, ensuring the strategy's success.

Exponential demand for critical materials, driven by the energy transition, may trigger supply chain problems. Circular economy business models could help decouple the renewable energy sector from material consumption. However, with major economic, regulatory and financial barriers, the sector's transition sector towards a circular economy still has a long way to go.

This report, commissioned by the Green Purposes Company and prepared by the Gate C consulting firm, proposes an action plan for the renewable energy sector which will enable it to be fully aligned with the principles of a circular economy and to reap its benefits. It is critical that in helping to address climate change, the renewable energy sector does not inadvertently drive environmental problems elsewhere.