Germany's federal government has adopted a comprehensive action program to implement its National Circular Economy Strategy (NKWS), aiming to strengthen industrial competitiveness, improve resource security and reduce dependence on primary raw materials.
Published on June 3, 2026, the program sets out 12 priority measures to be implemented by the end of 2027 and positions circular economy practices as a key pillar of Germany’s climate and industrial policy.
According to the government, expanding circular economy activities could help Germany reduce an additional 80 million mt of CO₂-equivalent emissions by 2030 while lowering climate protection costs and reducing exposure to supply chain disruptions. Authorities also expect the strategy to strengthen secondary raw material markets and support the development of a more competitive European recycling sector.
A dedicated implementation platform will be established to coordinate cooperation between industry, government and civil society. The platform will focus on areas including digitalization, digital product passports, critical raw materials, secondary raw material markets, pilot projects and public-private partnerships.
€565 million earmarked for circular economy investments
To accelerate investment and innovation, Germany plans to provide approximately €260 million through a new "Future Circular Economy" funding program financed by the Climate and Transformation Fund. An additional €305 million has been allocated for the 2027-2030 period under the Climate Protection Program 2026. The funding will support pilot and demonstration projects involving critical raw material recovery, battery recycling, recycling of wind turbines and photovoltaic modules, textile recycling, digitalization initiatives, circular business models and start-up development.
Government studies estimate that Germany's circular economy could generate gross value added of up to €125 billion by 2045, compared to approximately €60 billion today. Cumulative economic value creation is projected to reach between €700 billion and €880 billion over the coming decades.
Public procurement is expected to become a key mechanism for stimulating demand for circular products and secondary raw materials. Authorities intend to promote the use of secondary raw materials in public construction projects and strengthen requirements related to recyclability, repairability and resource efficiency in building design.
Digitalization and recycling to support raw material security
A major component of the strategy focuses on digital technologies aimed at improving material traceability and closing resource loops. Germany plans to establish a dedicated coordination center, support the deployment of digital product passports, expand the use of artificial intelligence and develop industrial data ecosystems. Authorities also intend to create a Circular Economy Information Ecosystem (CEIS) to improve product traceability, data exchange and decision-making throughout supply chains.
At the same time, recycling is expected to play a larger role in securing critical raw materials. Germany plans to support the objectives of the EU Critical Raw Materials Act (CRMA), including the target of meeting at least 25 percent of annual critical raw material consumption through recycling by 2030.
Legislative reforms planned
Germany also plans to modernize its circular economy legislation over the coming years. The government intends to revise the Circular Economy Act by mid-2027, further digitalize regulatory procedures and update regulations covering mineral substitute construction materials and landfill management.
In addition, Germany plans to align national legislation with the EU End-of-Life Vehicles Regulation, which includes recycled-content requirements for plastics and may eventually introduce minimum recycled-content requirements for steel and critical raw materials.
Beyond domestic reforms, Germany also plans to support harmonized recycling standards, stronger secondary raw material markets and reduced bureaucracy at the European level. The government also intends to deepen international cooperation with countries including China, India and Brazil while promoting German circular economy technologies abroad.
WV Stahl welcomes strategy but calls for stronger commitments
The German Steel Federation (WV Stahl) welcomed the adoption of the action program after months of delays, emphasizing that circularity is already a core element of steel production rather than a future objective.
WV Stahl CEO Kerstin Maria Rippel described the circular economy as a key driver of competitiveness, raw material security and climate protection for the steel industry. However, she argued that the action program remains insufficiently binding in several critical areas, including public procurement, critical raw materials, implementation mechanisms and planned amendments to the Circular Economy Act. According to Rippel, Germany should introduce a binding monitoring system for steel scrap exports, improve investment conditions for advanced sorting infrastructure and circular production facilities, and adopt sustainable procurement policies based on a "Made in EU" principle. Rippel also called on Germany to take a more proactive role in shaping the future EU Circular Economy Act, arguing that stronger national initiatives are needed to ensure that circular economy objectives and industrial competitiveness advance together.