Three ways for Chinese companies to 'go circular'

HONG KONG -- Chinese companies have to redesign their industrial processes, green their goods, and focus more on selling services in order to "go circular" and move towards a sustainable industrial development, said Edward Clarence-Smith, a senior official at the United Nations Industrial Development Organization on Tuesday.

Addressing The 3rd Forum on Future Development of China, Clarence-Smith said the current systems of production and consumption use too many resources and generate too much waste and pollution, that the society needs to build a concept of circular flows of materials to ensure those materials to go back to the economy after use and transformation.

Giving suggestions on how Chinese companies can "go circular", Clarence-Smith said firstly they need to redesign their industrial processes in the factory, to use the least amount of material and energy input, generate the least amount of pollution and waste, and to maximize the use of recycled and renewable inputs.

He said every factory manager has to start a new process of critically reviewing on how to achieve that goal. "Technology is not so much the solution, but management is the solution."

Secondly, at the products level, Clarence-Smith said the firms need to green their goods through redesigning, so that they are made with less materials, consume less materials and energy during use, and can be easily recycled at the end of their useful life.

"When you look at the whole life cycle of certain categories of products, they actually use much more energy during their use phase rather than during their manufacturing phase or their disposal phase," he said.

"Therefore, it is important not to focus so much on how the product is made in the factory, but how it performs during the use phase."

Moreover, Clarence-Smith said the companies may focus more on selling the services rather than the goods, such as leasing the products instead of selling them.

He said there are strong environmental advantages that the goods can be used more efficiently and for longer periods of time, and normally they can be better recycled at the end of their life.

Clarence-Smith is the head of the UNIDO's Regional Office for China, the Democratic People's Republic of Korea, Mongolia and the Republic of Korea.

The Forum was held by Hong Kong Pei Hua Education Foundation with the theme of "Revitalization of China", aiming to explore the opportunities and challenges for China's rise as a power from the perspectives of science, humanity and social economy.