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CIRCULAR ECONOMY MODEL:

THE CASE OF VIETNAMESE ENTERPRISES

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Nguyen Ho Truc Mai , Tran Thi Anh Hong , Ha Nguyen Hong

Abstract: The objective of this research is to promote the application of the circular economy
model in Vietnamese businesses in the coming time. The authors apply the circular economy model that
has been applied in the world and Vietnam, using statistical methods of description, comparison,
analysis and synthesis. The research results have assessed the current situation of awareness of applying
the circular economy model in Vietnam recently. From there, the research has proposed policy
implications for developing and replicating the circular economy model in Vietnamese Enterprises in
the coming time.
Keywords: Circular economy, business, model, policy implications, Vietnam

1. Introduction
The circular economy (CE) is an economic model aimed at efficiently utilizing
resources by minimizing waste, maintaining long-term value, reducing primary resource
use, and establishing closed loops of products and materials within the boundaries of
environmental protection and socio-economic benefits (Morseletto, 2020). In Vietnam,
the CE has been included in the Resolution of the 13th National Congress of the

Communist Party of Vietnam, highlighting its importance in the socio-economic
development of the country. The CE is becoming an inevitable trend toward sustainable
development in the future by maximizing the lifecycle of all resources used in
production and business processes, thereby reducing environmental impacts.
Vietnamese businesses have also started adopting the CE as an investment for the future,
helping Vietnam achieve its Net Zero target by 2050 as committed, contributing to the
fight against climate change, environmental degradation, and enabling sustainable
business development.

2. Overview of the Circular Economy
2.1. Concept of the Circular Economy
Stahel and Reday (1981) outlined specific characteristics of the circular economy
(CE), focusing on the industrial economy. They envisioned the economy as a closed
loop with circulating materials, thereby preventing waste generation, creating new jobs,

achieving resource efficiency, and dematerializing the industrial economy. The authors
argued that using the term "consumption" rather than "ownership" of goods is the most
sustainable business model for the circular economy, allowing industries to generate
profits without external costs and risks associated with waste.
However, the concept of the CE was officially introduced by Pearce and Turner in
1990. According to Pearce and Turner (1990), the CE refers to a new economic

94 University of Cuu Long, Email:nguyenhotrucmai@mku.edu.vn
95 University of Economics Ho Chi Minh City - Campus Vinh Long
96 Tra Vinh University
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