Enabling Circular Practices in the Manufacturing Industry: Barriers and Challenges

Circular Economy has been an integral part of the sustainability agenda and contributed to several different Sustainable Development Goals (SDGs), particularly SDG 12, Responsible Consumption and Production. Malaysia ranked fourth among seventeen economies in terms of its competitiveness as a manufacturing hub which contributes about 23 % to its GDP. It is imperative that the manufacturing sector in Malaysia takes the lead in promoting circular business models across its entire value chain. As the uptake of circular economy practices in the manufacturing sectors remains low, this work aims to understand the extent of the awareness of the circular economy and the adoption of circular principles in the manufacturing sector in Malaysia. The findings show that more than two-thirds of the respondents are familiar with the circular economy concepts. In general, the respondents are highly aware of the economic benefits of the circular economy, particularly when they consider risk factors associated with the scarcity and costs of raw materials as well as supply chain issues. The study also identifies barriers and challenges faced by the industry players in transitioning towards the circular economy. These barriers and challenges include financial and economic constraints, lack of technical and technological capacity and capabilities, organisational and institutional factors, fragmented green-growth policies and initiatives, and lack of industrial integration and support. The findings can serve as a reference to recommend best practices for the manufacturing sector to move towards the circular economy principles and help policymakers to design general standard operating procedures for the implementation of the circular economy in Malaysia.