Report Shows Sweden Loses 600 Billion Kronor Annually Due to a Linear Economy
The report, Circularity Gap Report (CGR): The Value Gap—Sweden, shows that Sweden loses approximately 600 billion kronor annually as a result of today’s linear “use-and-throw-away” economy, in which products are designed for a short lifespan and are rarely reused or recycled. The report shows that one-fifth of the total economic value created in the country each year is lost, which corresponds to 57 percent of the national budget.
CGR Value Gap: Sweden, funded by RE:Source and developed by RISE Research Institutes of Sweden and Circle Economy, introduces the concept of the value gap—a unique measure of the economic value lost when resources, products, and systems are not fully utilized.
Sweden’s value gap stands at 19 percent, indicating that nearly one-fifth of the potential economic value is lost due to linear practices. This amounts to 600 billion kronor, or 57 percent of the national budget.
“Historically, we have measured prosperity based on the value we create. Few have looked at the value we lose. Our economy is leaking, and the value gap shows where these leaks are and how much they cost,” says Ann-Charlotte Mellquist, project manager and researcher at RISE.
The report shows that products discarded prematurely are the largest source of lost value, costing Sweden 420 billion kronor annually. In addition, overconsumption—expenditures that exceed actual needs or provide minimal benefit—amounts to 200 billion kronor annually.
“The majority of goods that reach the end of their life cycle are not reused, refurbished, or recycled. Our inability to give products and materials long lifespans means that we are wasting not only the materials themselves, but also the energy, labor, and infrastructure invested in them—the very value we work so hard to create,” says Klas Cullbrand, Head of Innovation at RE:Source.
To reduce value loss and promote circular opportunities in Sweden, the report highlights the need for policies that recognize environmental and social value, such as tax incentives for reuse and circular procurement. It also emphasizes incentives for circular business models and the importance of integrating circularity into education, culture, and regulations to promote conscious consumption and long-term sustainability.
“Sweden is known for its sustainability ambitions and capacity for innovation. By addressing the value gap, Sweden can lead the way toward a more efficient economy that both conserves resources and strengthens competitiveness,” says Klas Cullbrand.
And although the report takes Sweden’s economy as its starting point, its conclusions are relevant even beyond the country’s borders.
“It shows that linear models are not only harmful to the environment but also economically weak. This presents a strong business case for the circular economy, which can unlock billions in untapped value—both in Sweden and globally,” says Ivonne Bojoh, CEO of Circle Economy.
The report is available in both English and Swedish.
