Encouraging a circular economy

The government is taking various measures to encourage the transition to a circular economy. For example, legislation and regulations are being changed and investments are made in businesses working towards a circular economy.

The measures include:

  • fostering legislation and regulations;
  • intelligent market incentives;
  • financing;
  • knowledge and innovation;
  • international cooperation.

Fostering legislation and regulations

Legislation and regulations can encourage innovation, but also hamper it. Legislation and regulations that hamper innovation must be changed or removed. For example, by changing regulations for transporting waste across borders. Companies often decide not to transport waste because of all the red tape. This means that waste is not reused even though it could be. Legislation and regulations that encourage innovation should be developed further. This includes rules promoting a sharing economy, by making it easier to share things like cars or tools. 

Intelligent market incentives

Intelligent market incentives can help turn the market for products and services into a circular economy. For example, by encouraging producers to use raw materials that can be reused more often. Or by requiring government organisations to buy only circular products. 


Investing in circular products and services carries different risks than investing in linear products and services. For instance, the risk profiles and depreciation periods are different. The distribution of costs and benefits is also different. As yet, little is known about how the costs of companies in the circular economy relate to their revenues. That’s why the government is planning to study this in collaboration with the Netherlands Investment Agency. The government also wants to invest in entrepreneurs who are active in the fields of renewable energy, energy saving and reducing CO2 emissions. 

Knowledge and innovation

To create a circular economy, education and research are vital, as is spreading and sharing knowledge within networks. There’s a need for knowledge on every aspect of a circular economy, from technology to taxes and grants – as well as the effect on the labour market. The government is therefore stimulating the creation of knowledge networks and different ways of exchanging knowledge. 

International cooperation

To create a circular economy in the Netherlands, changes are needed in Europe and worldwide.  This is because raw material supply chains and waste flows are global. And not all discarded products or materials end up in the Netherlands or even in Europe. Also, many businesses operate internationally. That’s why the government works with other countries as much as possible, in the European Union and also in the United Nations.