[Feature: Toward a Circular Economy and Society] Roundtable Discussion: How to Create a Circular Society Beyond Recycling

The "circular society" has long been one of the pillars of Japan's environmental policy, but in recent years, the issue of plastics has attracted significant attention, and public interest is also rising. Furthermore, the "Act on Promotion of Resource Circulation for Plastics" has been in effect since April of this year.

Today, many stakeholders have set the SDGs as their goals. Regarding "circulation," it not only aligns with Goal 12, "Responsible Consumption and Production," but since the plastic problem became prominent, it has also become related to Goal 14, "Life Below Water," making it an increasingly important theme.

Today, I would like to ask everyone to talk about how they perceive the current situation, what challenges exist, and what the future outlook is for further advancing a circular society.

First, Mr. Tsukahara, who has been involved in environmental policy at the Ministry of the Environment, could you tell us about the principles under which Japan's resource circulation policy has operated?

During the period of high economic growth starting in the mid-1950s, waste surged along with the increase in consumption, and industrial waste, including difficult-to-treat materials, also increased. At that time, I believe the Ministry of the Environment's policy was largely focused on measures against improper disposal.

In other words, it was about how to regulate attempts to dispose of waste cheaply and poorly through illegal dumping. While there is much talk about recycling policies now, we started with the crackdown on improper acts, and I believe the principles based on that way of thinking are reflected in the Waste Management Law (enacted in 1970).

The turning point was the emergence of dioxin (a substance suspected of being carcinogenic to humans) from incineration plants in the late 1990s, which became a social issue. For the Environment Agency at the time, the dioxin problem was a major shock, and they had to compile impact assessments and establish regulations (standards for water and air, structure of incineration facilities, maintenance standards, etc.) in a short period. In the midst of that painful experience, the discussion turned to the idea that we must reduce waste rather than burn it in the first place, and it was clearly stated in the Basic Act on Establishing a Sound Material-Cycle Society (enacted in 2000) that the 3Rs (Reduce, Reuse, Recycle) take priority over disposal.

First, Reduce (reducing waste) and Reuse (reusing items) are important, followed by Recycle. This awareness gradually spread. The word "Mottainai" gained attention, education in elementary schools and other settings was implemented, and waste separation at home became extremely detailed compared to other countries. Many recycling laws for specific items, such as automobiles and home appliances, also emerged.

The Plastic Resource Circulation Act, which is currently a hot topic, is quite different from the approach of individual recycling laws. First, the biggest point is that it focuses on materials. Another major difference is that it looks at the life cycle from the product design stage to the disposal stage. I think a major feature is that it brings everything that uses plastic into the scope of control and targets various players.

In this way, I see that a resource policy-oriented way of thinking focused on materials will become mainstream from now on. However, used products are discharged in a state where parts with resource value and parts to be treated as waste are mixed. Technology is required and costs are incurred to extract resources from them, and in some cases, recycling lacks economic rationality.

However, if we rely entirely on foreign countries for processing, ecosystem-like elements such as proper processing and recycling technology will flow out along with the resources, potentially collapsing the foundation for maintaining processing technology firmly within the country.

I was in charge of the Basel Convention, which regulates the export and import of hazardous waste, at the Ministry of the Environment. Mixed metal scrap and plastic mixtures (miscellaneous scrap) were being exported from Japan overseas in a jumbled state and traded for value, but resources were flowing out, and there were problems with pollution and health damage caused by improper recycling and processing in developing countries.

At that time, what I felt had a major impact on the flow of resources was resource prices. As resource prices fluctuated and transactions shifted between reverse-payment (a state where the cost at hand becomes negative in waste disposal transactions) and valuable, the direction of preventing environmental pollution and promoting resource circulation did not mesh well with existing laws, which was a very large challenge.

Ultimately, it was decided to handle miscellaneous scrap through legal amendments so that its handling could be regulated even if it had value, but I am strongly aware that the economy governing the waste disposal and recycling business fundamentally has such problems.

The dioxin problem, which was a turning point, occurred around 2000. Since the adoption of the Kyoto Protocol was also in 1997, I believe the era of the environment in Japan probably began around that time.

Mr. Shimamura, you have developed various businesses at a material manufacturer for a long time. What is your view on the business community's awareness of resource circulation?

Historically, when petrochemistry became a boom and plastics entered the world, the disposable economy became increasingly widespread due to the convenience of consumption as they became commoditized. In other words, the basic idea was to lower costs by producing in large quantities, making a profit by producing more and more in a one-way fashion. This was exactly the basic way of thinking in Japan before the oil shock.

At the same time, since Japan is a country with few resources, it created a basic economic structure of earning foreign currency by importing resources from overseas, processing them, and exporting them. In that process, while overseas companies are often very large and a single company owns chemical plants and complexes, in Japan, the size of each company is not very large, so the idea was for small companies to gather and create a large complex.

A system was established in Japanese chemical complexes where Company A would make a product, and the by-product from that would be used as the main raw material for Company B to make another product. I think that was very effective in reducing waste. In a sense, it was a very rational process of using materials carefully to create products.

This changed significantly with the two oil shocks in the 1970s. This first led to difficulties in raw material procurement. Furthermore, with the Plaza Accord in 1985, the yen suddenly appreciated, and the scenario of earning foreign currency through exports, which had supported Japanese industry until then, collapsed.

When the yen appreciated, export competitiveness suddenly dropped to less than half. However, production capacity remained the same. Moreover, the things that each company had been producing while taking in each other's waste saw the positions of the respective companies change, and the spirit of the complex stopped functioning.

So there have been such historical transitions.

Because of this, since the 1980s, the industrial world has also been trying to reduce waste as much as possible. First, by increasing the yield in a single manufacturing process, waste itself is reduced, and product productivity is increased. Manufacturers began to realize that they could not achieve economies of scale with the old concepts, and they all started talking about a "shift from quantity to quality." To increase profits even with small quantities, there was no choice but to create high-value-added products.

Another thing is that while costs during factory production had been emphasized until then, not much attention had been paid to other peripheral costs. These include logistics costs, recycling, and waste disposal costs. Awareness began to change toward the idea that all costs must be viewed as a whole when making a single item at a factory. Legally, I think various regulations, including the CO2 issue, are pushing that forward.

In that context, how have the initiatives at AGC Inc. changed?

Our company's main products are glass products. Architectural glass has a very long lifespan, so it is suitable for recycling. We have been using waste glass from construction materials as cullet as part of the raw material for making new glass for a long time. That said, the recycling rate has not reached 70%, so we are continuing efforts to raise it.

This applies not only to architectural glass but also to automotive glass and bottles, for example. In Europe, there are more bottles than plastic for containers. This is because, in a sense, they can be recycled continuously. In Japan, PET bottles have become mainstream.

The recycling rate for bottles is currently around 74%, and we are further advancing that. Of course, recycling itself is important, but it is also good from the perspective of CO2 reduction because it saves that much energy. That is a major area we are working on.

To put it simply, once glass is installed, it continues to be used until the house or building is demolished, so there is no doubt it is a long-life product. Recently, what we have been doing is not just extending the lifespan but, for example, reducing energy consumption by applying special metal coatings.

Eighty percent of the heat transfer between the temperature inside a house and the outside world occurs through window glass. Therefore, by using glass with high insulation properties, the insulation effect increases, ultimately leading to CO2 reduction. Double-glazed windows, which combine two sheets of glass, have now reached a penetration rate of over 90% in new homes.

When we simulated in the past, replacing all window glass in single-pane glass houses nationwide with high-insulation eco-glass would save an amount of electricity equivalent to about two nuclear power plants. It seems the conversion standards have changed recently, so I get complained to when I say this (laughs).

After all, it's about "Reduce"—how to decrease energy consumption. Considering that we should tackle this as an overall environmental issue, not just a plastic issue, for example, using five layers of glass seems to have the same effect as an insulated wall. The use of three or four layers, sometimes with film sandwiched in between to provide strength, has already begun to be put into practical use.

Material-based industries need to provide the materials necessary for a circular society in terms of how to eliminate waste, as well as through recycling and reuse.

I believe the movement to charge for plastic shopping bags the year before last was largely due to the issue of marine pollution from plastics. Mr. Takada, as someone who has researched the state of such marine pollution for a long time, how do you perceive the current state of pollution in the natural world?

At the UN Environment Assembly in March 2022, a resolution was passed to start negotiations on a plastic treaty (a legally binding international agreement). This reflects the global spread of plastic pollution and the severity of its impact. While one trigger for the Ministry of the Environment was dioxin, another important point regarding plastics is that the issue of endocrine disruptors emerged in the 1990s. Some plastics themselves become endocrine disruptors, and there are several additives that are endocrine disruptors themselves, yet they are still being used today.

Endocrine disruptors eventually enter the ecosystem and expose humans. In particular, plastic waste becomes microplastics, enters fish and shellfish, leaches out and accumulates in their flesh, and exposes humans through the food chain. That perspective is very weak in the Ministry of the Environment's policy. We have said this many times in committees, but it doesn't change. I think the biggest problem is that the issue of endocrine disruptors has been ignored.

Even today, PET bottled water is placed here. Rather than it being the fault of the person who placed it, I think the problem lies with the Ministry of the Environment for not raising awareness about such things. Looking at individual items, PET bottles are the most common form of plastic pollution in the ocean. However, they don't take any action against them. I believe the idea that recycling is enough is the problem.

Even if recycled, as long as they are used, drinking from them increases the risk of microplastics and chemical substances such as additives contained within entering our bodies. A recent study in China showed that when comparing people living on tap water with those who drink bottled water, the amount of microplastics in the feces is higher in those who drink from PET bottles.

I believe a circular economy is different from recycling. A circular economy is about changing the choice of materials and changing how the materials themselves circulate within society. It would be a mistake to think that a circular economy has been achieved simply by raising the recycling rate. No matter how much you recycle PET bottles, as long as you continue to use them, the fact that humans are exposed to chemical substances remains unchanged.

While there are still many unknowns internationally regarding the extent of the impact on humans, Western countries have been moving in the direction of "reducing use where it is not necessary" as a precautionary measure.

You mentioned that there are many glass bottles in Europe, but that is not just a matter of recycling rates or price; it is because the sense of crisis regarding the use of plastic for food and drink is higher among Europeans, whereas it is low in Japan, so we continue to use it.

Even from the perspective of global warming, I agree that glass bottles are superior. Producing and recycling one PET bottle generates 140 grams of CO2. With glass products, it can be kept to 80 grams.

Mr. Takada, you collect pellets and other items that have washed ashore to conduct marine pollution surveys. What can be learned from that research?

We pick up plastic that has washed ashore and measure the hazardous chemical substances contained within it. Various things are included, but they can be broadly divided into two types: one is what has attached from the surrounding seawater, and the other is chemicals called additives that were originally kneaded into the plastic and remain there. Recently, we have been focusing on these residues.

Plastic has the property of floating and drifting far away. That's why it's found on remote islands, such as Easter Island or the Ogasawara Islands. It has recently been discovered that even in plastics found in such places, additives formulated during manufacturing at factories hundreds of kilometers away remain. Plastic is transporting chemical substances such as additives to distant remote islands. We are beginning to see that this poses a risk to fragile ecosystems that were originally free of pollution.

You mean the marine ecosystem.

Yes. However, these microplastics are also in familiar places. They are contained in the sewage we discharge, and they are also on the streets, washed away by rain into rivers and waterways. These eventually enter the marine ecosystem.

To investigate when such pollution began, we measured the mud (strata) in the moat of the Imperial Palace. In the deep layers of the strata, from the Edo period, microplastics are of course not included. They start to appear a little in the 1950s. By the 2000s, the amount increased more than tenfold. We have learned that pollution is progressing rapidly due to our mass production and consumption of plastic.

They are also floating in the atmosphere, aren't they? And those accumulate in the moat.

That's right. In addition, things that fall on roads and the ground are washed away when it rains and accumulate in the strata. It is truly the Anthropocene. I think it is a symbol of an era where human influence reaches even into the geological strata.

Mr. Yamamoto has been researching waste for a long time. In that context, what are the characteristics of Japan's resource circulation policy and the movements in resource circulation?

I keenly feel in discussions at international conferences that recycling, as Mr. Takada mentioned, is not the goal of a circular economy. However, we cannot reach the ideal suddenly. In reality, the path to getting there is important. In the sense of thinking about what to do tomorrow, I feel it might be unavoidable that there is a PET bottle here today (laughs).

I would like to speak against that background, but first, there is the problem of policy leakage.

Mr. Tsukahara mentioned dioxin, but in the 1990s, incineration facilities were very small, so incomplete combustion inevitably occurred, releasing dioxin. From around 2000, the Ministry of the Environment provided subsidies to make them larger.

However, at the same time, various 3R laws were enacted to reduce waste, and waste did decrease. In other words, while the amount of material to be burned was decreasing, incineration facilities were becoming larger and larger. As a result, the capacity of incinerators became excessive, and the recycling rate in some municipalities ended up being low.

At around 1,000 degrees Celsius, complete combustion occurs and dioxin is not released, but if you stop incineration because there is nothing to burn, it once passes through the dangerous range of about 200 to 600 degrees. And when you light it again, it passes through it once more. From the perspective of people on the ground who are worried about dioxin being released, there is a desire to keep it running continuously.

In this way, there are cases where satisfying one requirement compromises another, but since economics analyzes such things quite well, I believe such a perspective is important.

Also, Mr. Shimamura mentioned complexes earlier; non-ferrous metal smelting such as copper, zinc, and lead smelting still remains in Japan, and they accommodate each other's waste through recycling. Zinc from copper smelting is passed to zinc smelters at another company. By working through a network across Japan, they barely reach international prices. Therefore, if that network is cut somewhere, price competitiveness is lost all at once.

The biggest crisis was when the domestic supply of lead-acid batteries for recycling almost disappeared because South Korea bought up waste lead-acid batteries from all over Japan at low prices through illegal processing. At the timing when improper processing was exposed in South Korea in June 2016, the Ministry of the Environment moved quickly and managed to maintain it, but as trade becomes more uncertain in the future, I believe maintaining such networks is important in the world of resource circulation.

What are the characteristics of waste disposal in Japan?

Waste disposal in Japan is overwhelmingly dominated by incineration. About 80% is handled this way, whereas in other OECD countries, it is mostly in the 30% or 20% range. The greatest characteristic of Japan's waste disposal is its heavy reliance on incineration.

Japan claims to be recycling by recovering energy there, but this is actually not very good. This is because, internationally, it is not considered energy recovery unless it has a certain level of energy efficiency. The energy efficiency of waste-to-energy power generation cannot be called good, and it usually ends up being treated as normal incineration, which does not count as recycling institutionally. So there is no doubt that Japan burns too much.

On the other hand, other countries rely on landfills, which is also not necessarily good for the environment, and it cannot be said that they are not contributing to global warming from there. Is it recycling, or is it about reducing the waste itself? I think discussions in this area will be difficult, involving the industrial characteristics and climates of each country.

It is true that energy efficiency is poor, but regarding plastics, even if energy efficiency is good, you are just burning something made from petroleum, and it doesn't become plastic again, so it's not recycling, is it?

Exactly. As it stands, if efficiency is low, it isn't even counted as energy recovery.

The term "thermal recycling" was coined as incorrect Japanese-English, misleading the public. Recently, the Ministry of the Environment has stopped using it, but they did so until a certain point, and I think that was one reason why plastics became so prevalent in Japan.

Burning plastic is not recycling. I think we experts need to do more to make society understand that "thermal recycling" is an incorrect term.

Mr. Tsukahara, hearing this, do you have any comments from the perspective of the administration?

First, personally, I am very concerned about the issue of microplastics and am careful to do things like grow loofahs to use instead of nylon scrubbers and use laundry nets with filters that prevent microplastics from leaching out. This is out of a desire to reduce the accumulation of impacts, even in small ways, when thinking about the next generation.

The production and usage of chemical substances are increasing steadily. Besides endocrine disruptors, there are substances whose impacts and actual presence are not clearly understood, which is a challenge. For example, there are international discussions regarding evaluation methods for nanomaterials and the actual presence of pharmaceuticals in the environment, and Japan is also striving to accumulate knowledge.

The impact of plastic additives is not yet known for certain. However, because plastic has entered deeply into our lives, exposure to additives is certainly increasing. I believe we must proceed with monitoring exposure levels and research and discussion regarding health impacts.

At the Ministry of the Environment, I was in charge of approaches to unresolved issues surrounding chemical substances. One example is a large-scale epidemiological study (the Eco-Chill Study: Japan Environment and Children's Study) that aims to clarify the effects of chemical substances in the environment on children's physical and mental health, based on the concept of precautionary measures.

With the cooperation of approximately 100,000 pairs of parents and children nationwide, we will follow the babies in the womb until they reach the age of 13. As a research result using data from the Eco-Chill Study, Nagoya City University recently announced an analysis showing that pregnant women who frequently eat commercially available lunch boxes or frozen foods (3 to 7 or more times a week) have a 2.6 times higher probability of stillbirth compared to those who eat them less frequently (once a week or less).

Following this announcement, there were reports suggesting that additives might be released from heating plastic containers in the microwave, but that study has not yet verified a causal relationship with chemical substances. Since socio-economic factors and lifestyle factors are also thought to have a complex influence, further research is awaited to clearly identify the cause and take preventive measures.

As Mr. Takada pointed out, it is wrong to think that burning for proper disposal or recycling is the solution. In plastic recycling, there is a possibility that additives are recycled together as recycled plastic, and if harmful substances are included in the additives, there is a risk of concentration through recycling.

Heat recovery (which is distinguished from recycling in the Plastic Resource Circulation Act) is also a factor that advances global warming. Fundamentally, we must reduce usage. In particular, there is too much one-way use of plastic.

On the other hand, it is not just so-called experts and people directly involved in manufacturing who create a circular society; general consumers, citizens, and society as a whole create it. Mr. Shimamura, I imagine many of your material sales are to companies, but do you feel that the response of partner companies toward resource circulation is changing?

It is only recently that the business world has begun to be conscious of the environment along with convenience; in the past, the priority was simply to produce and consume in large quantities. Now, although it is not yet sufficient, automobile manufacturers are starting to do what they can, such as reusing bumpers. I feel that the awareness of not increasing waste any further has risen considerably.

One thing I am concerned about is that the EU is quite far ahead in its thinking regarding environmental issues. Even if it feels abrupt to us, they put things forward first, believing that they must do these things as precautionary measures. On the other hand, Japan's style is symptomatic treatment—doing something once a problem occurs.

This may be a difference in national character, but I think the time has come to change the old way of "doing something when something happens" for environmental issues as well. Europe puts out precautionary measures first, and the industrial world must develop technology toward them. It is a policy thinking of subtracting from the worst-case scenario.

Regarding carbon neutrality, Japan has also said, for better or worse, that it will reach zero by 2050, and we must think about various things toward this. With the Japanese way of doing things until now, one first thinks, "Carbon net zero by 2050 is impossible." However, starting from the idea that the world will not survive unless we reach zero, I feel that thinking about what must be developed and how things must be made by then has finally begun.

In terms of consumer awareness, in Europe, many places seem to be starting large-scale renovations of house windows as a base for carbon neutrality.

Also, in cold countries, heat tends to enter and leave through windows, so they tend to make windows small. However, making windows small is not good for mental health. It is said that large windows soothe people's feelings. In Northern Europe, there is data showing that the suicide rate, which was high in winter, decreased by making windows larger with high-insulation glass.

In that way, high-heat-resistant window glass is effective not just for energy efficiency but as an item for human well-being.

There was a major global issue where neonicotinoid pesticides were causing honeybees to disappear. Even at a stage where the cause hadn't been fully identified, the EU restricted or banned the use of neonicotinoid pesticides. I wondered how they could make decisions so quickly with so many countries and stakeholders involved, but now I understand that such a background exists.

I think the photo of a sea turtle with a straw stuck in its nose also had a significant impact on making marine plastic pollution a social issue that many people became aware of. Mr. Takada, do you feel that the awareness and behavior of citizens are changing?

Plastic pollution has spread throughout the entire ecosystem, and the detection of plastic has been reported in the bodies of over 600 species of marine life, from whales, sea turtles, and seabirds to fish and shellfish. I believe that public concern is growing due to the damage to various marine organisms.

Because it is an issue for marine life, some people focus on cleaning up beaches to keep the ocean clean. Others think about where the source of the damage to marine life lies and try to review what they can change in their own lives, such as avoiding single-use plastics as much as possible.

However, if we focus only on the issue of marine life, some people might think, to take an extreme view, that it's fine as long as we collect it properly on land and burn it at high temperatures in large-scale incinerators so it doesn't end up in the sea. But that alone cannot protect our health. In fact, plastic and related chemical substances have been detected in human blood and fat. Thinking that far ahead, an increasing number of people are avoiding the use of plastic itself.

The charging for plastic shopping bags began the year before last. Do you feel that awareness has changed?

Quantitatively, I think it has definitely decreased. Many people bring up the charging for plastic bags at public lectures and the like, and many say they are trying to carry their own reusable bags as something they can do first.

While some people move toward reducing other plastic containers and packaging because there are so many others, there are also those who continue to use plastic bags, thinking it's pointless to do this since there are others. However, I think the charging has acted as a trigger, and the number of people taking an interest is increasing.

Resource circulation policy is something that is closely linked to the lives of ordinary people. In a sense, it requires effort, so I think the state of citizen awareness is very much involved.

Regarding the story of plastic bags, I think it's true that there are people who work hard at it and those who think it's pointless if they are the only ones doing it. As a result of charging for or banning plastic bags, there has also been an increase in the purchase of garbage bags. There are also stories that the consumption of transparent bags provided in supermarkets has increased significantly.

That being said, since the charging for plastic bags, hasn't an atmosphere been fostered that there are things worth sacrificing consumer convenience for the sake of the environment? In environmental economics, the stance used to be not to think much about things like environmentally friendly consumers, but I think that is no longer the case.

In CO2 reduction, there is a standard called Scope 3. Japanese companies are very good at reducing Scope 1 through their own efforts. However, when it comes to Scope 2 and Scope 3, it becomes increasingly difficult to reduce without the cooperation of clients and consumers. I think Japanese companies and government administrations have been poor at that coordination, but the waste version of Scope 3 feels like the circular economy.

It's not just about each company making long-lived products, but how the consumer uses them afterward. For example, even with a reusable bottle, if you buy it and only use it 10 times, a PET bottle would have been better, and conversely, the environmental load becomes higher. I think the circular economy aims for a goal that cannot be achieved unless it is based on the premise that products are properly managed within the whole system, including the consumer, after they are made and sold.

How to do this is a very difficult but extremely important issue, and I really want the Ministry of the Environment to do its best.

Having conducted garbage surveys, do you feel any difference in awareness between EU citizens and Japanese citizens?

In terms of average values, I don't think they change that much. However, when you look at the numbers—and this isn't a matter of consumer sorting—the incineration rate is very high, and Japan's recycling rate for household waste is very low. I think there are various reasons for this, but in that sense, I feel the pressure of not being seen as an environmentally advanced country.

However, general households in Europe don't sort their garbage, do they?

That's right. Compared to Japan, there are many cases where they don't sort much at home and take it to intermediate treatment facilities. That way, consumers don't have to make an effort, so more recyclable resources are collected. If you make consumers sort it, they find it troublesome and turn everything into burnable waste, resulting in fewer resources being collected.

On the other hand, I think the Ministry of the Environment believes that the high level of sorting awareness is linked to various environmental behaviors in Japan.

As you say, we have been doing the 3Rs like a slogan for a long time, and regarding the plastic bag issue, the Ministry of the Environment has been supporting initiatives by local governments and supermarkets through model projects since the 2000s. I think the fact that we were able to step into national regulations was largely due to the global attention on the marine plastic issue. On the other hand, there was also criticism that plastic bags only account for about 2% of the total amount of plastic waste, so it wouldn't be a fundamental solution to the marine plastic problem.

However, according to a UN report, the amount of plastic containers and packaging waste per person in Japan is the second highest in the world after the US (2014 data). The problem is that so-called one-way use, or disposable use, has become established, and plastic bags can be said to be a symbol of that.

I also feel that consumer awareness is gradually changing. As I mentioned with the example of one-way plastics, some people say that Japan's plastic measures are lagging behind and that the new Plastic Resource Circulation Act should have gone a step further. But for now, a foundation has been created where various things can be done, and a framework has been established to move forward from voluntary efforts. I hope that as consumer awareness changes, it will become like so-called soft law where everyone feels they must do something, leading many companies and local governments to take action.

Recently, I bought Sony wireless earbuds, and they are made entirely of recycled plastic, and they are white. I think this is quite amazing. There is little such information in commercials or advertisements, and basically, high functionality is promoted, but according to the manufacturer, environmental consideration is being valued in surveys and consumer reviews.

In this way, there is a reality where young people are responding to so-called "meaningful consumption" or ethical consumption. I feel a big change in the fact that the younger generation, who will occupy a very important position as consumers in 10 years, is starting such consumption styles. I feel once again that the Ministry of the Environment should move policy forward with a future vision of how things should be, while being conscious that the norms for future generations are changing.

One more point: within SFC, I want to evaluate the current state of energy and resource use, discuss the ideal state of decarbonization and resource circulation, and bring about concrete changes. As I've found by doing it myself, the story of energy and resources is not something that can be completed by ourselves, so we inevitably have to think about the relationship with the region.

For example, even if we put solar panels on almost all the roofs of SFC buildings, they can only cover 20-30% of the demand. There is a large loss in generating the missing portion far away and transporting it. So, when looking for unused resources nearby, there are biomass resources such as food waste from SFC and livestock waste from nearby pig farms. I am thinking of visionary ideas like whether we can somehow generate electricity using these. In a small country like Japan, if we want to truly achieve zero emissions while being self-sufficient in resources, I think it's absolutely impossible unless we share information with local people and do what we can for each other.

As a Ministry of the Environment official, I want to be able to talk about various values comprehensively, capturing the word sustainability broadly, including regional benefits—becoming healthy, everyone being happy by connecting with the region, or being happy to wear something wonderful—rather than just putting the environment at the forefront.

Also, the Ministry of the Environment has been implementing policies using the term "circular society" for a long time, but recently, Professor Hiroki Tanikawa and others at Nagoya University have been conducting research under the term "stock-type society," which was an eye-opener for me. Many stocks are being created in society, and we should evaluate and maintain them properly to use them for a long time. Visualize what is where. It is proposed that Japan, which accumulated various stocks during the period of economic growth, should consider their utilization amidst future resource depletion.

"Circular society" is a term that has driven policy, but I think a shift in thinking where each individual looks at the stocks that currently exist is also important.

Hearing such stories makes the future feel bright. Within such a vision, we must discuss the challenges for realizing a circular society.

Mr. Shimamura, when thinking about resource circulation in the industrial sector, what kind of network-like mechanisms, systems, or institutions will be necessary in the future, beyond just recycling?

Chemical plants used to operate in an eco-cycle where small parts gathered together to use everything up to the end, but that became impossible due to changes in the environment of each company. I would like to make it possible to do that again in a different form.

In terms of decarbonization, I think Scope 3 is exactly about collaboration. If everything is based on self-sufficiency, open innovation is difficult to achieve. For example, even among material manufacturers, there could be initiatives to reduce transport volume and lead to CO2 reduction through inter-regional swaps.

Regarding cost reduction as a manufacturer, Japanese people say they work hard, but Europeans standardize the work. In Japan's case, it's craftsmanship (takumi); over there, it's a system. Japan says this is a black box, so we can't show it.

Regarding resource circulation, it is necessary to proceed by collaborating and borrowing each other's strength, not just looking at one's own company's situation. If we don't reach carbon net zero by 2050, companies will be out of the ring and unable to do business, so this is a matter of life and death. We must act with that awareness. At that time, an awareness of "only my place" is no good.

Especially when it comes to different industries, the conversation doesn't get through at all. Because they are different industries, there may be parts that can be utilized well, so rather than asking the government to think about networking and concrete action plans, it is necessary for private companies themselves to convey to the Ministry of the Environment or the Ministry of Economy, Trade and Industry that they can do these things in a form that fits their actual situation.

I also serve as the chairperson of the Asahi Glass Foundation, and every year we ask people of various generations around the world about the Environmental Doomsday Clock. I don't think young people's awareness of or interest in the environment is low. I think we should spend more money on efforts to get those people to have a strong awareness of the environment.

How do you perceive the society that uses resources designed by Mr. Takada, and what are its challenges?

As long as plastic is made from oil, it will be out of the ring in 2050. As long as you are making products dependent on oil, they will no longer be bought in Europe or America.

If you ask whether we should just change all plastic to be made from biomass that doesn't depend on oil, biomass is cellulose, so if we try to replace all 10 million tons of plastic currently used in Japan with cellulose-derived ones, large-scale deforestation would occur. For such reasons, I think a world will come by 2050 where we must significantly reduce the total amount of plastic used compared to now.

What should we do for that? I think various measures are necessary, but the most necessary thing is to change from an economic system that mass-produces fresh food and daily necessities in limited places in the world as monocultures and transports them globally, to a social system that circulates things within certain regional units. Recent examples have made it clear that the global economic system until now had good short-term economic efficiency but is vulnerable to crises such as infectious disease outbreaks and international armed conflicts, and is not sustainable.

And as long as things are moved globally, plastic packaging and wrapping will inevitably appear. I won't go as far as local production for local consumption, but we need to change to a world where things circulate in regional units. I think we should resolve the plastic issue by incorporating it into that. Especially if we are to reduce the amount of plastic used while reducing the carbon footprint, I think it is necessary to aim for a decentralized and circular society where things circulate in regional units.

Some people think of biodegradable plastics such as biomass as a dream technology and believe that using them will be fine. However, that technology is strictly supplementary, isn't it?

Exactly, I think it's a supplementary technology. I think things that are biodegradable and biomass-based are one essential form if we are to use plastic, but there are environments where they won't decompose if they end up in the sea. We have also detected biodegradable plastic as microplastics on the seabed of Tokyo Bay. We must also create a system to collect them properly on land and let them decompose there. I think it's dangerous to rely only on material improvement.

The important thing is to think about a system that changes the way things are moved in society while changing the materials. It won't be easy because the whole of society must change, but there is still time until 2050, so I think we cannot fundamentally solve the problem unless the public and private sectors work together to change the way things are moved toward that goal.

It's never the case that things are fine just because the technology exists; we should change social systems and behaviors together. You mentioned that a system like the Regional Circular and Ecological Sphere is necessary, but I think a circular society requires various elements such as networks and communication. Mr. Yamamoto, what kind of system-building do you think is important?

That's a difficult question (laughs). I think the Regional Circular and Ecological Sphere is a very good idea. However, I think one of the cores of the idea put forward by the Ministry of the Environment included waste treatment facilities, but that region is too small. In terms of economies of scale, it should be done in a sphere about two to four times larger. There are too many current incineration facilities, and it won't work well if done at the current scale.

Currently, the cost of burning one ton in waste treatment is very high. Whether incineration is good or bad is another matter, but it's more efficient to collect more and process it on a large scale, so when considering the sphere, I think policies that can be formed in a way that considers economic efficiency a bit more are important.

I also agree that relying on materials is difficult. From a different perspective, cellulose-based or biodegradable plastics actually become foreign substances when they enter the current recycling system. That's why it's difficult to introduce them even in the transition phase.

I think this is one typical example of what Mr. Takada said earlier about having to change the system for society as a whole.

Mr. Tsukahara, what kind of new system structures are you currently heading toward in the administration?

I think the regional circulation mentioned just now is the biggest part. I think it originally started with the story of regional decarbonization, but it's becoming a flow where resource circulation and biodiversity issues are all connected. Since both decarbonization and biodiversity are deeply related to resources, I think resource circulation will come to the center of regional discussions. It's hard to feel the change in decarbonization just by putting up solar panels, but resource circulation has changes in a visible form, so I think it's easier for individual players to engage with.

However, I think there is a significant problem in that both citizens and waste-generating businesses feel that as long as they put out the waste, the administration or contractors will process it without them knowing. Regarding the issue of overseas exports that I have worked on, we have relied on China for processing both metals and plastics on a 20-year scale, but most Japanese people didn't know that.

In fact, what we lost during that time is also very large. When creating the Act on Promotion of Recycling of Small Waste Electrical and Electronic Equipment, I was told that the state of home appliances leaking overseas was bad and to stop the overseas leakage, so I worked hard on the issue of mixed scrap. Around that time, the Chinese side also decided to ban the import of mixed scrap and plastics. However, because there was no market for such things in Japan and we hadn't built an ecosystem, even if we suddenly say "domestic circulation," the environment to do it is not ready.

Unless we create demand for recycled materials and firmly plant our feet in nurturing people and companies, we will end up with a mountain of difficult-to-process materials domestically.

I believe it is necessary to look at resources over the long term and conduct resource circulation policy along with resource importance and resource strategies. To solve that, I think optimizing the scale of circulation and bringing it down to the local economy is an important approach.

I often hear that when the balance of supply and demand changes, technology can decline in an instant, technological innovation may not progress, or the industrial structure can go to an irreversible point. This might be particularly prominent in resource circulation, that is, the venous part.

Finally, I would like each of you to say a word on what the challenges for designing a circular society are.

One major difference between the venous side, which is the premise of resource circulation, and the arterial side is that you cannot control the amount generated, or it comes out with a delay. If you say you'll stop production, it disappears at that stage, but garbage keeps coming out later. In that case, ensuring proper treatment is important.

While drawing a beautiful picture like the circular economy, there are things that inevitably come out that cannot be controlled, so we must not forget the perspective for proper treatment.

For example, there are cases where manufacturers further upstream, without entering the Container and Packaging Recycling Act, take away only clean waste PET bottles because they want them, asking to sell them first. On the other hand, dirty plastics are left behind in the system. If a situation occurs where such dirty plastics are not treated well, that is indeed bad. I think we must not forget to keep an eye on both.

We are in an era where companies that lived at the height of so-called shareholder capitalism, where it was fine just to make and sell, must change their stance. What is required now is truly public interest capitalism, or stakeholder capitalism.

At that time, I think we are in an era where companies are required to recognize everything from raw material procurement and development to disposal of what they made—not just CO2, but everything, like a life cycle assessment—and take necessary measures.

However, since one company's power is weak, we aim for a new circular society by reconstructing networks within companies or society. I think this is exactly the "new combination" that Schumpeter talks about. I think companies should always recognize that if they ignore this, they will no longer be able to do business in society in the future.

I think the Ministry of the Environment's perspective on the plastic issue is too strong on waste management or resource circulation, and very weak on the perspective of the impact of plastics, especially chemical substances, on organisms. Unless we strengthen that, although things are circulating, the amount of chemical substances flowing in the system won't change—or rather, it will increase—and the exposure of ecosystems or people to hazardous chemical substances will increase. I think we must not forget the perspective of exposure to hazardous chemical substances.

And rather than regulating because some concrete impact has appeared, I think a precautionary perspective is important: regulating because an impact is already appearing in those who are susceptible to it.

The SDGs have a major goal of "leaving no one behind" before the 17 individual goals. Since the impact of chemical substances varies greatly depending on the individual, it is a fact that impacts are already starting to appear in those who are susceptible, such as people with multiple chemical sensitivity. It is also a fact that plastic-derived chemical substances are accumulating in our bodies. There are still few cases where a causal relationship between the two can be established, but impacts are starting to appear in the vulnerable. There have been cases where plastic additives were detected in the blood of patients with endometriosis, and research results like the one mentioned earlier where plastic products are suspected as a cause of stillbirth in pregnant women are also coming out.

Considering the precautionary principle, or the SDG principle of "leaving no one behind," I think we must handle the issue of chemical substances more precautionarily, like in Europe.

I hear that how to handle chemical substances contained in plastics, especially additives, is becoming an issue in the negotiations for the plastic treaty. I think the issue of chemical substances contained in plastics should be treated equally with waste management and resource theory and incorporated into the creation of a circular society.

Finally, Mr. Tsukahara. I apologize for asking you from the standpoint of the Ministry of the Environment even though you are now in the position of a faculty member of the Faculty of Environment and Information Studies, but please give us a comment from the administrative side.

I think the fact that the distances between production, consumption, and disposal have become so far apart is the big original problem. From the consumer's perspective, a way of consuming where they don't know where it was made and don't know where it goes after it's thrown away has increased the risk. I think we must think about how to face risks, including the precautionary principle.

The adoption of the SDGs has become a tailwind, and the Ministry of the Environment is increasingly talking directly with companies. From now on, I think governance-type policies will become mainstream rather than regulation-type. I hope the Ministry of the Environment can propose more in-depth ideas and collaboration methods to companies. And above all, I believe the important role of the administration is to create a business foundation where fair competition can take place so that companies that can be active in the future can grow.

In addition, from the perspective of citizens, I want to send out messages so that people notice that both decarbonization and resource circulation are deeply related to things close to their lives, such as food and fashion issues.

There is no doubt that the environment is in a critical situation, but just waving the flag for the environment won't resonate. I think policies are needed that can draw a future where everyone pursues happiness and, as a result, environmental problems are solved.

I feel that everyone has taught me today that a society that has properly realized resource circulation is one where various elements are intertwined, far exceeding what is evoked by the term "resource circulation."

You have given very suggestive talks. I have also learned a lot, and I would like to thank you.