Europe’s share of global plastics production has fallen from 22% to 12% over the past two decades. According to the EU, plastics production and consumption rates have doubled over the past two decades. They are projected to triple by 2060! The Plastics Europe association sums it up: The decline in Europe stands in stark contrast to the industrial boom in other regions.
Global plastics production rose by 4.1% last year and by 16.3% since 2018. Asia now accounts for 57.2% of global plastics production, with China alone accounting for 34.5%. Declining production capacity in Europe means one thing above all: the “old” continent must import more and more plastic, thereby making itself dependent on other regions of the world. The reason for this trend is well known: rising energy and raw material prices, as well as climate-related taxes.
The Role of Recycled Materials in Europe’s Raw Material Independence
What might a way out of this predicament look like? If less virgin plastic is produced in Europe, the importance of recycled materials—which are already present in the European economic cycle—will increase. In 2022, recycled materials accounted for only 8.1% of total plastic use in Europe—so there is still plenty of room for growth.
After all, Europe has a source of raw materials that is often underestimated. Large quantities of plastic waste are already being generated within Europe today:
- in production processes
- in end-of-life vehicles
- in electrical and electronic equipment
- in building products
- in textiles
The challenge lies not so much in the availability of raw materials as in processing these materials in a way that allows them to be reintroduced into high-quality applications. The key skill for the future will therefore not be recycling alone, but the ability to develop high-performance materials that meet standards from heterogeneous waste streams. Those who master this skill will tap into new sources of raw materials, contribute to climate protection, and strengthen Europe’s technological competitiveness and security of supply.
The EU is working on uniform, Europe-wide quality standards for recycled materials to create a functioning single market for high-quality recycled plastics and ensure a stable supply. The proportion of recycled materials in certain products, such as packaging, is regulated by the EU Packaging Directive, while in the automotive sector, it is governed by the EU End-of-Life Vehicles Directive.
Findings from the European Commission’s Joint Research Center show that circular economy solutions can reduce the sector’s climate-related emissions by 45%, decarbonize energy consumption, and improve the sector’s trade balance by 18 billion euros per year by 2050. The development of a high-performance European recycling industry is therefore not only a contribution to the circular economy but is increasingly a matter of industrial sovereignty.
Companies in Europe have the knowledge and technologies to produce high-quality recycled materials from plastic waste, some of which can compete with virgin materials in terms of their properties. The real value is not created solely by collecting and processing plastics, but by the ability to develop reproducible, high-performance materials for demanding industrial applications from complex material streams. Many companies in Europe excel precisely in this area.
Ways to Ensure Fair Competition
The EU recognizes that the plastics sector is facing increasing pressure. The EU cites fragmented markets for recycled materials, high energy costs, fluctuating prices for virgin materials, and unfair competition from third countries as the causes. To ensure fair competition between recycled plastics produced in the EU and those imported into the EU, the introduction of a generally binding mirror clause for the import of recycled plastics into the EU is essential.
This would ensure that recycled materials imported from outside the EU must meet the same environmental, quality, chemical, and documentation requirements as their European counterparts. The imported recycled materials should reflect European standards. The EU is currently establishing such mechanisms. For example, the EU Packaging Regulation and the planned implementing acts for the Single-Use Plastics Directive will establish requirements stipulating that imported recycled materials will only count toward EU recycled material quotas if they are produced in accordance with environmental and recycling standards comparable to those of the EU.
The EU also plans to introduce separate customs codes for virgin and recycled plastics. This is intended to support the enforcement of EU regulations on imported plastics by customs and national market surveillance authorities. In addition, the EU announced monitoring measures for the EU and global markets for virgin and recycled plastics, which are intended to serve as the basis for potential trade measures to ensure fair competition between plastics manufactured in the EU and imported plastics.
Meanwhile, calls are growing louder to include both imported new goods and imported plastic recyclates in the European Carbon Border Adjustment Mechanism (CBAM). This would make sense from a climate policy perspective and be consistent with industrial policy. But for now, this remains a distant prospect.
In a nutshell
It is clear that Europe’s energy, industrial, trade, and raw materials policies must be approached in a more integrated manner. Plastics recycling reduces energy consumption in many value chains, cuts down on the use of primary fossil raw materials, and taps into material resources already available in Europe. This reduces dependence on volatile global supply chains and imports.
An effective circular economy is therefore no longer merely a tool for environmental and climate protection, but an essential building block of a resilient European industrial policy. For this transition to succeed, policymakers must take action, as fair competitive conditions are essential: effective market incentives for high-quality recycled materials, transparent requirements for imported recycled materials, and reliable investment conditions for companies investing in modern recycling and materials technologies.
The strategic resource of the future is not just recycled material—it is Europe’s ability to repeatedly develop high-quality materials for new industrial applications from existing material streams. This issue has been partially addressed in EU policy, but there is still much room for improvement.
