ENPI Complexity Brief 12: The uncircularity paradox in energy geopolitics – Governance implications and institutional responses

The ENPI Publications (the-enpi.org, №12): The uncircularity paradox in energy geopolitics – Governance implications and institutional responses, (Kalpakchiev, 2020)

This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

There is an overarching silo mentality when it comes to the international dimension of sustainability (e.g. climate or security or resource governance), which oftentimes leads to easier fact contestation or blurring of realities. EU’s circular economy strategy can be seen as the landmark policy to mainstream environmental sustainability across the horizontal dimension of policy (in)coherence and hence its externalization, inter alia via economic missions to abridge SMEs and know-how with that of other sizable economies and climate diplomacy, now stands at the core of a vision for interdisciplinary geopolitics based on ethics, regulation and ecological transition. EU’s market power stands at the core of this power of attraction when it comes to regulation (e.g. GDPR in Brazil), however, notions of external governance, ethics and justice are adding a normative dimension to geopolitics. One potential externality of this is occurrence of a jevons’ paradox in its external engagement with third countries, meaning that resource efficiency policies could result in higher consumption and extraction patterns, as they are inextricably bound with increased demand for resources, which decarbonisation entails. Large areas of the global south are an arena for resource extraction led growth, exacerbated by the appetite for pristine resources of inter alia and notably, China. Its signature policy, the Belt and Road has been criticized for providing a form of rogue aid that is tied with liabilities such as mines or land, as well as usage of Chinese workers and expertise.

Nevertheless, the amount of deployed infrastructure loans in places such as Africa finds no genuine competitor in terms of volumes. The EU relies much more on a hybrid, multi-level engagement that seeks to transform the legality of extraction, the principles of value distribution in trade, as well as to curb eco-innovation. When it comes to the multilateral setup strategies are also different – China invests heavily in influencing decisions in the UN system via alignment of the Belt and Road countries that favour it, while the EU engages in an agent-principal relationship with UN implementing various regional facilities for resource efficiency and circularity. Overall, China pursues a high-level, economic dependency strategy and EU a bottom-up capacity building one. With the announcement of a Green Deal with a 2060 decarbonisation timeline, China will require further access to both critical raw materials. It already holds much of raw material mines and is using the sustainability argumentation in WTO to restrict exports of pristine resources[1]. Its upstream state owned enterprises allow this to happen with minor sanctions[2], as a new strategy to retain developing country status has emerged[3]. While the EU has a strategy for critical raw materials, it is investing much of its R&D in domestic recycling and upscaling as an attempt to achieve resource sovereignty. The externalization of this approach will hardly be sufficient to substitute exports of resources to China as a pathway towards economic development. Especially in areas where both actors have deployed strategies, such as Africa, Central Asia and the pacific coast of south America a contestation for resource exports led development and inherently, circularity as a vision for ecologically prone autonomy is eminent.


The first hypothesis that can be developed is that:

H1: EU Circular Economy missions do not reduce export of natural resources to China.

Here Chile (, South Africa and Malaysia) can serve as case studies, where macroeconomic statistics will be complemented with investigation of trade structure (e.g. via trade sift). Decisions on particular UN decisions related to resource extraction with political significance (e.g. fossil fuels) can be further investigated to see what were the voting patterns of these case before and after the missions. Stakeholder analysis and mapping will then be complemented in view of delineating the bottom-up and top-down state and non-state actor interactions. Any outlined patterns can be visualised via the telecoupling theoretical framework. As EU’s trade is inherently bound with access to other instruments (e.g. H2020, Green Goods, Aid for Trade, Twinning and institutional support, some financing and ad-hoc global health initiatives), the access to these can be tested for several other test cases in order to see if this has any influence.

H2: The Belt and Road is a foreign policy aimed at facilitating exclusive access to primary resources in third countries. 

Congo (, Brazil, Myanmar and Russia) hold some of the important critical raw materials important for the energy transition. In order to achieve a coherent line of analysis, the cobalt in Chile and Congo can serve as line that pierces through the analysis, which clearly has a strong importance due to the future electrification of transport and the usage of batteries also as storage for renewable energy. Clearly here one ought to make a review of circular economy academic and grey literature related to energy transition, EU and China’s strategic documents related to resource sovereignty and foreign economic policy, as well as whether there are any non-tariff trade barriers that can accrue the advancement of a closed regionalism built through the belt and road. Usage of interviews and surveys (potentially in combination with H1) can be used to elicit any informal ways for enacting such barriers.

[1] https://www.ies.be/files/2012-Jan-26%20-%20Fiott%20Presentation%20on%20EU-China%20natural%20resources_0.pdf

[2] https://www.cambridge.org/core/journals/world-trade-review/article/chinas-export-restrictions-and-the-limits-of-wto-law/5FE72154779864E0CB0CC6CD18848CCB

[3] https://thediplomat.com/2019/07/chinas-evolving-strategy-for-wto-reforms/              

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