China Aims for $1.2 Trillion Circular Economy by 2030

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China is set to enhance its circular economy framework, a model focused on minimizing waste and optimizing resource utilization by prolonging the lifespan of materials, throughout its 15th Five-Year Plan that began this year. The nation aims to boost the value of its resource recycling sector by 60% by 2030, reaching CNY8 trillion (approximately USD1.2 trillion) from 2025 levels.

By 2030, the country’s circular economy encompassing production, consumption, recycling, and reuse will be more advanced, with the efficiency of major resource utilization expected to improve about 16% compared to 2025. Resource output efficiency is assessed by the ratio of gross domestic product to the total consumption of key resources.

Since 2012, four Five-Year Plans have outlined strategies for developing the circular economy. Last year, the resource recycling industry generated around CNY5 trillion (USD735.8 billion), with significant improvements—about 77%—in the efficiency of major resource use since 2012, based on data from the National Development and Reform Commission.

The plan also aims to cut energy and water consumption per unit of GDP by approximately 10% from 2025 to 2030. Annual recycling of primary renewable resources is projected to increase from 410 million tons to 510 million tons, and comprehensive utilization of bulk solid waste is targeted to reach 4.5 billion tons.

Implementing this strategy will help build a broader, higher-quality, and more resilient circular economy by 2030, enhancing resource security and supporting the country’s goals for peak carbon emissions and carbon neutrality, according to Yao Xin, vice president of Tsinghua University’s Research Institute for Environmental Innovation in Suzhou New District.

However, challenges remain, such as low resource output efficiency in critical sectors, inadequate recycling channels for significant waste types, and technological hurdles. Strengthening institutional frameworks, refining industry management, fostering technological innovations, and upgrading industries are necessary to advance high-quality development within the circular economy.

Following rapid expansion in new energy sectors, China anticipates a phase of large-scale retirement of electric vehicle batteries, photovoltaic systems, and wind power facilities during the 15th Five-Year Plan. Recycling of waste from these products and infrastructure will thus be a central focus of the new plan.

For instance, the plan mandates power generation companies to incorporate recycling and disposal costs for decommissioned wind and solar equipment into their operational expenses, and to transfer retired equipment to qualified recycling entities for proper management.

It also emphasizes creating a comprehensive, lifecycle-based recycling system for electric vehicle batteries and strengthening product traceability. Notably, the plan includes waste from emerging infrastructure like data centers and telecom base stations within the circular economy framework for the first time.