#3 Addressing climate change and environmental impacts

The world is facing climate breakdown and cities contribute heavily through their demands for manufactured goods. The negative impacts of manufacturing, referred to as ‘externalities’, are rarely fully appreciated by consumers while the consequences remain both out of sight and out of mind in third countries. Global production chains make it highly problematic to trace the manufacturing process from resource extraction, to processing of raw materials, transportation of goods and other environmental and social impacts. Alongside emissions, cities are accumulators of vast amounts of resources and producers of high volumes of waste. Not only is this environmentally destructive, it is costly for city budgets with the World Bank estimating that twenty percent of municipal budgets are spent on dealing with waste.47 To tackle numerous environmental issues associated with global manufacturing, cities must find ways to separate material and energy consumption from growth of the economy and improvement of quality of life in urban areas.

Addressing the externalities through innovative design and processes

Environmental challenges make it abundantly clear that the current status quo is not sustainable, and that society must find new and just ways to manage resources by focusing on the demand rather than the supply of goods. A range of regional and international policy objectives and international agreements are putting pressure on consumers and manufacturers.48,49 While it is easy to interpret this as creating red tape and infringing on freedoms, there is much to gain from using resource management as a driver for innovation and to strengthen the local economy within the planetary boundaries. 

Cities, as sources of innovation, stores of resources and drivers of culture should be vanguards in this shift. Developing environmentally sound innovation is within the gift of cities, and the urban manufacturing sector with its capabilities and skills should be recognised as a key enabler. Cities should combine the design of objects and services that can reduce low value resource consumption and waste. Consider for example the vast volumes of plastic waste from imported single use water bottles, producing many tonnes of waste despite many (Western) cities having high quality tap water. This plays into the concept of designing globally and producing locally which can include a range of both product solutions and changes to resource consumption.50

Shifting to a circular economy

The circular economy sets out a framework for a shift in the way we make and consume goods which has a heavy link to local manufacturing. Rather than the current linear, ‘take, make, waste’ means of production, circular economy principles seek to keep resources in use and at their highest value for as long as possible.51 Viewing manufacturing as a key component of circular economy infrastructure, along with activities like repair, recycling and reuse, establishes it as part of a wider production and care system. 

Research has found that both environmental and economic benefits could be derived from this systemic transition. Government agencies at various levels have made commitments to transitioning to a circular economy.52 But the focus has been on recycling, which is the least effective intervention and fails to capitalise on the potential of urban manufacturing. The volume of resources present in cities are excellent potential flows for new activities, particularly by starting with resources used directly within the manufacturing sector itself. The following could take place:

High quality production

The manufacture of good quality products which are designed to stand the test of time is a clear way of reducing waste. European cities are already home to high quality manufacturers across a range of products, from ceramics to clothing. Quality products often come with higher prices, which can pose a barrier for the general public. New businesses or financing models are needed to justify extra costs that could be incurred.

Repairing and maintaining

Repair and maintenance are key functions of a circular economy. These activities were once found on every high street, from the cobbler to the tailor, but they have waned as new products have fallen in price and the incentive to repair has dwindled. However, increasing demand for repair would see it returning to our cities and providing additional income for manufacturers and skilled tradespeople. Repair should be combined with ‘right to repair’ regulation that is appearing in many countries across the world to avoid unnecessary disposal of goods.

Re-manufacturing or refurbishing

More in-depth than repair, the remanufacture or refurbishment of a product strips it back and rebuilds it for a new life. From upholstery to heavy plant machinery, this creates new employment within cities. Technology should be easy to upgrade without having to replace the entire unit.


This is currently where most efforts are focused. However, under circular economy principles, recycling is the least effective intervention, as large amounts of energy are required while recycling remains limited to certain materials and is costly. Recycling waste locally (rather than sending it overseas, which is currently common in Europe) would reduce environmental impact and provide feedstock for a circular economy loop at a local scale. To incentivise local recycling, there must be productive activities driving demand for the resources. Manufacturing in cities is vital to support this development and keep resources cycling locally, otherwise perfectly recyclable materials will continue to be exported or to be simply incinerated.