THE INFLUENCE OF CIRCULAR ECONOMY ON SUSTAINABLE DEVELOPMENT: EUROPEAN AND SERBIAN EXPERIENCE

Abstract

The paper analyzes the influence of circular economy indicators on economic growth and the creation of new jobs, with a special focus on green jobs. In the last decade, circular economy has received rising attention worldwide as a way to replace the current production and consumption model based on a linear economy. By promoting closing the loop by applying the 6Rs (rethink, refuse, reduce, reuse, recycle and repair) with a particular emphasis on municipal waste, the circular economy aims to achieve better harmony between the environment, economy and well-being of society. EU member states have implemented various policies and initiatives, such as the Circular Economy Package, which aims to increase recycling rates, reduce landfilling and promote eco-design. Additionally, circular economy plays a central role in the new European Green Deal in its aim to tackle climate change. The Republic of Serbia has also recognized the importance of sustainable development and has developed its National Sustainable Development Strategy, which aims to promote economic, social and environmental sustainability. Using European Statistical Office (Eurostat) data from 27 European countries pertaining to the years between 2014 and 2021, this paper aims to examine the relationship between the circular economy, economic growth and job creation. Based on the cluster analysis, EU members are divided into several groups. Also, the results obtained from the regression analysis for EU member states were compared with the current state of application of the circular economy in Serbia, using data from the Statistical Office of the Republic of Serbia. Although the implementation of the circular economy in Serbia lags behind the EU average, there is untapped potential for further progress, especially in the field of energy. The results suggest that a circular economy provides opportunities to create competitive advantages and promote sustainable economic growth, which can be beneficial to decision-makers.