Taiwan is accelerating efforts to build its circular economy through new legislation, green funding and artificial intelligence-driven industrial upgrades, as officials work towards turning the island into a regional hub for resource-efficient industry.
The environment ministry said it has spent the past two years funding industry-academia collaboration to develop resource recycling technologies, with results showcased at a government research forum on Monday. The technologies, which included converting discarded textiles into construction materials were aimed at boosting sustainable consumption, recycling and circular processing.
Environment minister Peng Chi-ming said Taiwan’s circular economy sector is growing at about 9 per cent annually, compared with roughly 2.3 per cent in Germany, positioning it as a key pillar of the island’s green technology industry.
Taiwan’s green technology sector is currently valued at TW$512.3 billion (US$16.3 billion), of which about 30 per cent, TW$168.8 billion (US$5.3 billion), comes from circular economy activities. At current growth rates, officials project the sector could expand into a roughly TW$500 billion (US$16 billion) within a decade.
The latest policy push builds on a broader, long-term strategy outlined in Taiwan’s draft 2050 Circular Economy Roadmap, released last October and scheduled for finalisation this year.
The plan set targets to double resource productivity, cut per-capita material use by about 30 per cent and raise the island’s circularity rate to 2.5 times its 2020 level, while shifting the island’s policy focus from waste management toward a full resource-circulation system.
Peng has said Taiwan aims to become a circular economy hub for Asia, arguing that resource efficiency is critical for an export-dependent island with limited natural resources.
Officials say circular systems can reduce reliance on imported raw materials, ease pressure on waste management systems and strengthen supply-chain resilience in sectors such as semiconductors, petrochemicals and machinery.
The government plans to submit amendments to both the Waste Disposal Act and the Resource Circulation Promotion Act to parliament during the next legislative session starting later this month, part of a broader policy push that combines regulatory reform with industrial technology support and financial incentives.
Hsu Chih-lun, deputy head of Taiwan’s Resource Circulation Administration, which is responsible for circular economy initiatives, cited United Nations Environment Programme projections that global resource extraction could rise 1.6 times by 2060 compared with 2020 levels without urgent action. He said strong policy intervention could reduce global resource waste by about 30 per cent.
Officials highlighted recent industrial recycling breakthroughs, including calcium fluoride sludge recycling rates used in the semiconductor sector reaching 97 per cent, allowing materials to be reintroduced into industrial supply chains. Companies are also deploying AI-powered sorting systems to improve recycling accuracy while reducing labour dependency and contamination.
Peng said Taiwan will promote circular economy development across four areas: institutional coordination, legislation, technology deployment and financing. The government plans to establish a circular economy advisory council that will comprise industry and academica representatives to focus on areas such as critical metals, biological resources and industrial material recycling.
The ministry is also partnering with Taiwan AI School to expand industrial AI capabilities, while deploying a TW$10 billion (US$318 million) green growth fund to support corporate transition.
Taiwan has also introduced extended producer responsibility (EPR) rules and funded pilot programmes in remanufacturing, industrial symbiosis and eco-design, while encouraging collaboration between domestic manufacturers and multinational brands facing pressure to reduce emissions and resource footprints.
Officials say stronger circular standards could give Taiwanese exporters a competitive advantage as global buyers increasingly demand low-carbon, resource-efficient products.
Peng said ministry officials will travel to the European Union during the Lunar New Year period to study circular economy governance models, including EPR systems and digital product passports, with the aim of adapting relevant mechanisms for Taiwan while maintaining a cooperation-focused approach to regional partnerships.
