Fostering Eco-Innovation: Waste Tyre Rubber and Circular Economy in Croatia

Interdisciplinary Description of Complex Systems 17(2-B), 326-344, 2019 FOSTERING ECO-INNOVATION: WASTE TYRE RUBBER AND CIRCULAR ECONOMY IN CROATIA Ivana Šandrk Nukić* and Ivana Miličević Josip Juraj Strossmayer University of Osijek – Faculty of Civil Engineering Osijek Osijek, Croatia DOI: 10.7906/indecs.17.2.9 Regular article Received: 30 January 2019. Accepted: 29 May 2019. ABSTRACT The aim of this article has been to provide an insight into Croatian waste tyres market, which is assumed to be the source of significant eco-innovation. At the outset, the analysis of relevant literature has been done regarding the circular economy and eco-innovations. The empirical part of the study used the Strength-Weaknesses-Opportunities-Threats method in order to determine the perspective of the main market stakeholders. In the course of the SWOT method conducting, an in-depth interview was organized with managers of the only authorized mechanical recycling company in Croatia and an on-line questionnaire was used to learn about thinking and attitudes of other ELT market stakeholders in Croatia – representatives of the Ministry of Environmental Protection and Energy, Environmental Protection and Energy Efficiency Fund, Agency for the Environment and the Nature, authorized ELT collectors, Croatian scholars involved in previous waste rubber scientific studies as well as representatives of companies either using or selling rubber recyclate. Additionally, comparison to the European context has been conducted. Findings suggest that Croatian legislation and practice follow European trends: collection rate of waste tyres is near 100 %, and the total collected amount is being recycled – 83 % as the secondary raw material and 17 % as energy recovery. However, situational analysis detected that underdeveloped industrial production hinders seizing the full potential of produced raw material, thus missing the opportunity of generating the higher added value for the domestic economy. Consequently, Croatia’s Eco Innovation Index was by 28 % lower than the EU average in 2017. KEY WORDS waste tyre rubber, eco-innovation, circular economy, Croatia CLASSIFICATION JEL: O52, P27, Q56 *Corresponding author, : ; +385 99 596 1480; *Vladimira Preloga 3, HR – 31 000 Osijek, Croatia * Fostering eco-innovation: waste tyre rubber and circular economy in Croatia INTRODUCTION Circular economy initiatives aim to keep the value of products and materials as long as possible in the economy while minimizing the generation of the waste. The ultimate goal of promoting a circular economy is the decoupling of environmental pressure from economic growth [1]. In the same time, conceptualizing on circular economy and striving to implement different initiatives, represents a major contribution to the development of a sustainable economy, in which resources are being exploited efficiently, and new competitive advantages are being created. One of the significant circular economy initiatives, i.e., opportunities is the use of waste tyres, also called the end-of-life tyres (ELT). But, this opportunity is not straightforward, so although it is intensively researched, especially during the last five years [2], exploitation of innovative ideas and solutions is still limited with obstacles to bring innovation into commercial success [3]. However, ELT does represent an eco-innovation source, important in terms of business as well as for policy development. Literature research conducted for the purpose of this study has indicated that there are no recent scientific papers regarding available quantities of ELT rubber residues as well as their management system in Croatia. Beside scientific sources, not even official European records contain data on ELT resources availability in Croatia nor studies regarding their potentials (ETRMA). Additionally, the environmental and economic sustainability of circular economy framework is very site specific, so beside the type of the material being researched, it depends on several other factors like transport distances, economic and political context [2]. Therefore, research within particular countries is needed, as it builds to the existing body of knowledge. Therefore, the intent of the study has been to fulfil that research gap, providing the answer to the initial research question: What are the characteristics and potentials of Croatian waste tyres market? The stated research question has led to the following two research propositions. RP1: Although smaller, Croatian waste tyres market is in compliance with characteristics of the European waste tyres market in terms of legislation, collection rate, and recovery structure. RP2: Waste tyre market is a significant source of eco-innovations in Croatia since it provides opportunities for recycling, re-use, and new business models development, thus contributing to circular economy initiatives. The propostitions has been investigated using qualitative research methods, and the article itself has been organized in six sections. Immediately after the Introduction, a section providing the literature review is being presented. It has been divided into three subsections, in order to provide necesarry framework regarding legislation and financing models, ecoinnovations as well as recycling methods and possible uses of used tyres. The third section, called Data and methods presents details regarding the sample characteristics and scientific methods applied. The fourth section displays the empirical part of the Croatian waste tyre market study whilst the fifth section reflects on the results. The final section brings concluding remarks. Important acknowledgement, as well as references used, are given at the very end of the manuscript. This article results from the study which is part of the research being done in the course of the scientific project called Development of Reinforced Concrete Elements and Systems with Waste Tyre Powder, financed by Croatian Science Foundation. It belongs to the first research 327 I. Šandrk Nukić and I. Miličević phase, putting emphasis on the analysis of the rubber compound of ELT and its potentials, especially in terms of its availability in the Republic of Croatia, ELT market functioning and the related situation in that country. LITERATURE REVIEW REGULATION AND FINANCING OF TYRE WASTE The global population is becoming increasingly aware of the scarceness of resources, but at the same time, we are facing the growth of the population and its ever greater demand for access to wellbeing. The only possible response to such a situation is the attempt of improving the efficiency and effectiveness of resources use, including their re-use. Consequently, resource scarcity is the driver behind the circular economy. The recovery of materials and energy can add significant new value streams and improve cost recovery [4]. The circular economy is an economic model that encourages the so called 3R principle: reduce, reuse, (...truncated)