The benefits of enhanced circularity on strategic autonomy: Titanium metal in the EU

Abstract

Strategic autonomy can benefit from circular economy initiatives, such as reducing primary inputs and recycling critical raw materials in key technologies. Using titanium metal in the EU as a showcase, we start by combining information from heterogeneous sources: non-systematic data, macroeconomic statistics and micro-level information from Customs agencies. This procedure allows us to disaggregate secondary (i.e., titanium scrap) flows depending on their production stage, sector of origin and quality. Building upon this novel dataset, we design two enhanced circularity scenarios with marked strategic autonomy implications: a reduction of scrap buyback agreements in the EU with the US, and an increase in scrap collection from end-of-life aircraft. Finally, these scenarios are fed into an inter-country input–output model to compute their economic and employment impact. The results of our simulations show that the EU would benefit from retaining and valorizing secondary titanium flows domestically instead of routing it to third countries, most notably if domestic processing capacity is also increased, by up to 40 million euros in value added and around 620 jobs.