Financing the Circular Economy: a European Perspective

Abstract. Introduction For the development of the circular economy, many countries have begun to actively use various tools and mechanisms of public policy to ensure its complexity: from technology, financing and forms of business to the readiness of society as a whole to change their habits and create new schemes. However, achieving this goal is impossible without changing existing production strategies, taking into account the world's best practices for the implementation of the concept of circular economy, providing a positive economic effect for both producers and consumers. Expanding the circular economy at the global level requires a combination of business models, technological advances and innovations, as well as the joint efforts of stakeholders to secure its financing, including business and government. Purpose. The main purpose of the article is to study the views of the European community on the possibilities of financing projects in the field of circular economy, as well as to identify key recommendations for accelerating the funding cycle in the light of changes in the circular economy, taking into account best European practices. Results. The article examines the peculiarities of forming an opinion on the circularity of business processes by the European community; approaches to classifying projects as circular are given; There are three groups of circular economy business projects that differ significantly in terms of financing and cash flow: product as a service, joint models or industrial symbioses with other organizations, innovative models of products and processes; it is substantiated that the implementation of business projects requires a new perspective on their financing; the main sources of financing of circular economy projects are considered; the main barriers to accessing bank financing are presented, as well as the experience of foreign banks in their commitments to facilitate the transition to a circular economy; examples of European organizations and associations that take an active position on the financing of circular economy projects are given; It is argued that the growth of circular business models will require innovation and structural changes in production and consumption systems and related technological changes, which in turn requires a new view of banking institutions, insurers and investors to accelerate the financing cycle in the circular economy. sector by government organizations, creating a favorable policy and legal framework to accelerate a systematic, concrete and scalable approach to integrating circularity into financial products and services. Conclusions. Studies show that the implementation of circular economy projects requires a balanced approach to their financing, and there is no single right option for choosing a source of funding. Given the three groups of circular economy business projects that differ significantly in terms of financing and cash flow, financing will also differ in the way and by organization. It is established that the effective development of the circular business requires the use of several financing instruments, and in accordance with the partners in the chain of movement of materials. In order to expand the sources of possible financing of circular projects, it is necessary to consolidate the circular economy both as a strategic direction of economic development in order to achieve sustainable development, and as a priority area of investment.