This document analyses the possibility of scaling up the potential of the circular economy through financial instruments in Latin America and the Caribbean. It reviews progress in the circular economy in four business cases, selected based on priorities and representativeness for the Latin American and Caribbean region, and assesses the prospect of scaling them up using financial mechanisms and environmental, social and governance (ESG) schemes.
The findings show that investment in circular economy business models has multiple benefits for companies, such as profitable operating margins and improved corporate reputation, thereby lowering the cost of debt and of financing circular economy projects. Various financial mechanisms are applied to scale up circular economy initiatives and circular economy indicators are aligned with broader ESG frameworks.
To unlock the full potential of the circular economy in the region, new —and cheaper— financing alternatives should be considered. ESG funding has proven to be a reliable source of funding, even for circular economy projects, and has attracted the attention of investors the world over.Introduction .-- I. Dimensions involved in scaling up circular economy (CE) initiatives in Latin America and the Caribbean (LAC) .-- II. Finance mechanisms for scaling up circular economy (CE) initiatives .-- III. ESG frameworks and circular economy (CE) .-- IV. Case studies on scaling up circular economy (CE) initiatives .-- V. Recommendations for scaling circular economy (CE) initiatives in LAC .-- VI. Conclusions
