The BCG Economy Model uses three styles of economic policy approaches – bio, circular and green – in tandem.
This has the potential to increase results across multiple domains.
In order to understand how we can achieve better results, we need to think about the resources that underpin economies and societies, and contribute to greater human equity and wellbeing.
We can look at these resources as four main types of capital:
- Natural capital – the environment, its physical and biological resources.
- Human capital – the knowledge, skills and attributes of individuals.
- Social capital – the networks, institutions and values that unite us.
- Produced capital – everything that is manufactured, including buildings, finances, software etc.
Integrating the BCG Economy with the four types of capital reflects the flow between all domains, as this figure shows:
What does this look like in practice?
Let’s look at some examples in agriculture and food systems to understand how this works in practice.
Investing in education increases human capital.
In this context, if we educate communities about how to reduce their reliance on synthetic fertilizers, we have the opportunity to meet all three BCG goals by:
- Bio – protecting renewable biological resources
- Circular – ensuring healthier soils and more resilient food production systems
- Green – sustaining river systems and clean water.
Now let’s look at how we can increase social capital.
If we support the creation of local farmer networks, we can encourage people to share best practice methods for regenerative food production and ways to reduce their dependence on synthetic fertilizers. In doing this, we meet the BCG goals in these ways:
- Bio – harnessing potentials for reuse of resources
- Circular – reducing run-off and improve farming practices
- Green – scaling-up green economy practices and businesses.
Rehabilitating forests increases natural capital. In doing this, we meet the BCG goals by:
- Bio – increasing the stock of renewable resources
- Circular – improving the health of natural systems
- Green – encouraging sustainable forest eco systems; increasing bird breeding areas and pollination.
And finally, we can harness produced capital by using the internet of things (IoT) to monitor irrigation and water use. This meets the goals by:
- Bio – reducing the pressure on biological resources
- Circular – reducing demand for natural inputs
- Green – creating higher and more stable local incomes.
Want to know more?
Our recent report, Understanding the Bio-Circular-Green Economy Model, outlines all of these approaches in detail, with vital information about the way that APEC countries are currently using the BCG Economy in policy development.
Developed in partnership with The Asia Foundation, and presented to the APEC SOM Committee on Economic and Technical Cooperation, it’s essential reading for economic, social and environmental development.