24 November, AMSTERDAM — A first-of-its-kind study finds that Sweden is losing SEK 600 billion (€54.6 billion) each year due to linear economy practices, such as designing products for short lifespans and failing to reuse or recycle them. This loss represents 19% of the total economic value created in the country and is equivalent to 57% of the national state budget.
The Circularity Gap Report (CGR®) The Value Gap: Sweden, authored by Circle Economy in partnership with RISE, initiated and funded by RE:Source, provides clear evidence of the economic inefficiencies inherent in a linear economy, reinforcing the economic case for the circular transition. With this study, Sweden becomes the first country in the world to quantify how much economic value it loses due to linear practices.
‘Historically, we have measured prosperity by the value we create. Few have lookedat the value we are losing. Our economy is leaking, and the Value Gap shows uswhere those leaks are and how much they cost’, says Ann-Charlotte Mellquist, project manager and researcher at RISE.
Products discarded too soon are Sweden’s largest source of lost value, costing the country SEK 420 billion (€38.3 billion) annually. Extending product lifespans through reuse, refurbishment and remanufacturing could recover much of this loss.
‘The majority of goods reaching their end of life are not reused, refurbished, or recycled. By failing to give products and materials long lifespans, we waste not only the materials themselves but also the energy, labour, and infrastructure invested in them – the very value we work so hard to create,’ says Klas Cullbrand, Innovation Leader at RE:Source.
In addition, overconsumption—spending that exceeds actual needs or offers minimal benefit—amounts to SEK 200 billion (€18.2 billion) annually. This is roughly four times the amount Sweden planned to allocate for development aid to the world’s poorest countries in 2025 (SEK 56 billion).
When comparing economic sectors, construction stands out as the largest source of value loss, amounting to 180 billion SEK (€16.4 billion). The majority of this loss occurs when buildings are demolished and their embedded value is discarded. The second-largest source of value loss is consumer goods like textiles, electronics, plastic packaging and furniture. Each year, an estimated SEK 88 billion (€8 billion) worth of these goods becomes waste, while they could have remained in circulation within a more circular economy.
The report recommends the following actions to reduce value loss and better capture circular opportunities in Sweden:
‘While this report examines the Swedish economy, its findings are relevant beyond the country’s borders. It demonstrates that the linear, ‘take-make-waste’ models are not only environmentally harmful, but also economically weak. This presents a strong business case for the circular economy, which can unlock billions in untapped value—in Sweden and globally’, says Ivonne Bojoh, CEO at Circle Economy.
