Countries are ramping up sustainability plans, but too often, they are designed in isolation. A new UNCTAD SMEP Programme–Chatham House brief reveals that national circular economy and bioeconomy strategies, are rarely aligned, undermining efforts to use biological resources more sustainably and reduce pollution and waste. This gap is also negative for biodiversity goals and weakens the countries’ ability to meet their obligations under global environmental frameworks such as the Kunming-Montreal Global Biodiversity Framework (GBF).
Released ahead of the International Day for Biological Diversity, the analysis maps 143 national circular economy strategies and reveals a critical policy blind spot: whilst many countries have expanded circular economy plans focused on technical materials like plastics and metals, their bioeconomy strategies – covering crops, algae, forestry and agricultural residues – rarely include circular safeguards such as reuse, nutrient cascading, value recovery or regenerative practices.
The result is a growing disconnect that risks shifting pressure from fossil systems to biological ones, placing new demands on nature whilst missing opportunities for more sustainable and inclusive growth.
Whilst the circular economy aims to reduce waste and extend product life cycles, the bioeconomy focuses on replacing fossil inputs with renewable, biological ones. When aligned, they offer governments a powerful tool to meet biodiversity targets whilst stimulating green jobs, innovation and rural livelihoods. When pursued separately, they risk inefficiencies, environmental rebound effects, and exclusion from the emerging sustainable trade opportunities.
UNCTAD is the first UN body to systematically frame this disconnect as a trade and development issue – one with implications for investment, innovation and inclusion. The brief draws on field evidence from the UNCTAD-UK Sustainable Manufacturing and Environmental Pollution (SMEP) Programme, which supports real-world integrated circular bioeconomy pilots not only in reducing waste, but creating new value chains grounded in local realities and undervalued resources.
From banana and pineapple residues turned into textiles, to fish waste repurposed as feed and fuel, and black soldier fly systems that transform organic waste into high-protein feed, SMEP-backed projects are transforming pollution challenges into economic opportunities. These innovations support biodiversity by avoiding intensification of land and resource use. They also open up new roles for women, informal workers and rural entrepreneurs – groups often excluded from mainstream markets and value creation opportunities.
When biodiversity is at risk, so are the communities who rely on it most. From small-scale fishers to rural fibre producers, nature-based livelihoods form the backbone of food security, income, and resilience in many developing countries. But without enabling trade policies, standards and investment signals, such innovations risk stalling and not being disseminated across borders. “We see circular bioeconomy as key to industrial resilience and socially inclusive development,” said Guilherme Feliciano, Counsellor at the National Council of Justice (CNJ) in Brazil, at the UNCTAD-Chatham House event during the World Circular Economy Forum 2025, in São Paulo. “Brazilian courts are increasingly viewing sustainability not only as an ethical imperative but also as an area of significant financial liability” concluded Feliciano.
As new sustainability requirements and geopolitical shifts reshape global markets, countries without effective and integrated strategies may not only face compliance challenges but also miss out on opportunities for value addition, resilience, and market access.
Maria Durleva
Programme Management Officer, SMEP-UNCTAD
