Nguyen Mai, chairman of the Vietnam Association of Foreign-invested Enterprises, said that the linear economy poses a growing threat of resource depletion.

Compared to half a century ago, global consumption has increased by 190 per cent, and the demand for the natural resources that are necessary for economic development is currently 1.7-fold greater than the earth's capacity.

Therefore, unless production methods are changed, the consequences of resource depletion cannot be avoided.

Transitioning from a linear economy to circularity is necessary because this is an economic model in which design, production, and service activities aim to prolong the life of materials and eliminate the negative impacts on the environment.

The shift will create a great opportunity for rapid and sustainable development, achieving economic, social, and environmental goals while helping to mitigate climate change.

David Riddle, Tan Hiep Phat Group representative

David Riddle, representative of the southern beverage major Tan Hiep Phat Group said, "The circular economy is key to sustainable development, and even highly developed economies like Singapore must reconsider how they can successfully protect the environment, conserve resources, and achieve circularity."

On a global scale, many large corporations began moving towards a circular economic model very early.

The Tan Hiep Phat executive gave the example of Estée Lauder, a family-owned company founded in the US in 1946, that, since the 1970s, has focused on minimising packaging with a simple no-package approach, only providing it to consumers when there is a specific need.

Benefits to businesses and the community

When choosing to shift to a circular economy, businesses will face myriad difficulties.

Professor Mai stated, "Businesses must accept a slower pace initially, before then ramping up because investing in technology and training highly qualified human resources can push up production costs, and affect the consumption and competitiveness of products and services in the short term."

However, if the world continues its current production model, it will face even greater risks as it runs out of resources.

Tan Hiep Phat Group's cutting-edge production line

In Vietnam, Tan Hiep Phat Group has set an example in the beverage industry with its transition using the 3R model – reduce, reuse, and recycle – since 2013.

This model brings economic benefits to businesses and contributes to the development of the community, promoting sustainable development.

A decade ago, Tan Hiep Phat embraced a flagship bottle lightening project in which the weight of each bottle was reduced by nearly 20 per cent.

Simultaneously, through investing in German aseptic technology, the company has reduced the loss rate in its production process and saved on electricity and water usage. As of 2023, 78,000 tonnes of plastic waste has been reduced by the group.

Other important measures in the 3R model include recycling and reusing shrink film and plastic bags produced by the company, and eliminating the use of cardboard boxes by replacing them with shrink film made from recycled plastic.

In 2021, Tan Hiep Phat installed a plastic recycling line in a bid to produce recycled HDPE and other pellets from plastic scraps.

Riddle noted, “The circular economy is both meaningful and necessary, and it is time for businesses to participate. We need a strong legal corridor that stipulates specific responsibilities for manufacturers and distributors on collecting, sorting, and recycling, as well as payments for waste management costs.”

Leveraging the core value of being responsible for society, Tan Hiep Phat Group’s circular economic model demonstrates its commitment to putting the common good of the community at the forefront for the prosperity of all.