Proposing Circular Economy Ecosystem for Chinese SMEs: A Systematic Review

Circular economy (CE) has attracted so much attention around the world as it can contribute to the balance between economic development and environmental sustainability, to address the increasing critical resources scarcity and environmental issues. Small and medium-sized enterprises (SMEs) in China are a major driving force in the economy with 43 million SMEs in 2020. Most of them maintain the traditional economic development method of “take–use”, without considering the environment. This has caused great harm to the environment and resource availability. Therefore, Chinese SMEs must adopt CE in their business to address this issue. The current study aims to explore the key barriers (lack of time, lack of human resources and finance) and enablers (e.g., network, innovation, and reputation) for Chinese SMEs CE adoption. The current study employs a systematic review approach with thematic analysis to identify the internal and external barriers and enablers of CE adoption among SMEs. Moreover, a CE ecosystem has been proposed for identifying the key actors in the CE system, which will be beneficial for policy-makers to take into account when drafting and adjusting CE laws and regulations.