A circular economy in Germany means constant innovation

German industry has been warned it must make even greater efforts to maintain its position as a leading nation in providing recycling and waste management technology to drive the circular economy (CE).

The conclusion comes in a status report from 15 organisations and associations whose members make up what is called the ‘closed-loop economy’. They include IFAT, the Federal Association of German Steel Recycling and Disposal Companies (BDSV), the Federal Association for Secondary Raw Materials and Waste Management (bvse), PlasticsEurope Deutschland and the Association of German Metal Traders (VDM).

The report notes that technologically advanced and innovative industrial goods from the German sector of closed-loop economy are still in great demand on the world market. A few years ago, it points out, Germany was ranked third behind the USA and Japan in terms of patent applications. ‘In the meantime, China has passed Germany by – a clear sign that Chinese competitors are catching up in terms of innovative strength and quality.

‘If German suppliers want to maintain their leading global market position, they will have to make even greater efforts to meet the challenges in the global competition in innovation. This will be even more important as increasingly complex products require more and more complex recycling technologies.’

The report sets out the scale of Germany’s sector: the closed-loop economy achieved a revenue in 2017 of around EUR 84.1 billion (up 18% compared to 2010) and employed more than 310 000 people in 2019 (12% more than 2010).

‘With a gross value added of around EUR 28.1 billion in 2017 (up 31 % compared to 2010), the sector is an important economic factor in Germany and continues to develop dynamically,’ the report adds.

It is a diverse industry, too. Of its 10 700 enterprises, around 6 100 belong to the traditional market segments of ‘waste collection, transport and street cleaning’ and ‘waste treatment and utilisation’.

Nearly 1 300 companies deliver ‘technology for waste management’ while another 3 300 ensure the crucial cycle of collected and recycled materials in the segment called  ‘wholesale of waste materials’.

The report notes that intelligent design of products is key to ensuring they can be reused or recycled but cautions that recycling has technical, ecological and economic limits. Even so, ‘without high-quality recycling, the goals of the CE cannot be achieved’.

‘The Status Report on Germany’s Closed-Loop Economy impressively demonstrates the importance of the waste and raw materials industry as an economic sector and for future issues such as climate protection,’ concludes Stefan Rummel, managing director of Messe München which hosts the German version of IFAT every two years.