Global economies remain heavily reliant on material use, yet a substantial share of value is lost at every stage, from production and consumption to disposal. According to the Circularity Gap Report 2026, an estimated €25.4 trillion (± €4.7 trillion) in economic value is lost annually due to resource inefficiencies, premature product disposal and underutilised assets. Against a global GDP of €82.6 trillion, this underscores the scale of material-related losses.

Introduced for the first time in this edition, the “Value Gap” quantifies avoidable economic value lost under today’s linear, take-make-waste model. It provides a clearer lens on how inefficiencies erode value across systems. Beyond direct financial losses, the report highlights significant hidden environmental and social costs, including pollution, resource depletion, health impacts and reduced labour productivity.

Rather than framing this solely as a measure of loss, the report positions the Value Gap as a major opportunity, highlighting the potential for circular strategies to retain value, reduce waste and support more resilient long-term economic growth.

A staggering €25.4 trillion in economic value is lost each year due to inefficient material use, premature disposal and underutilised assets, the report finds. These losses—driven by systemic inefficiencies—account for nearly one-third of global GDP.

The report introduces the Value Gap as a new metric to capture these avoidable losses across the global economy.

Five key pathways of value loss

The report identifies five main channels through which value is eroded:

• End-of-life waste (€10.0 trillion): Products and materials discarded before their full value is realised.
• Energy losses (€8.7 trillion): Inefficiencies across the energy system from extraction to end use.
• Consumption of fixed capital (€5.2 trillion): Degradation of infrastructure, machinery and buildings due to underuse or poor maintenance.
• Processing losses (€904.2 billion): Inefficiencies and defects during material transformation.
• Food loss and waste (€650.7 billion): Edible food lost across supply chains and consumption stages.

Together, these pathways illustrate how value is systematically eroded throughout production, use and disposal.

The report attributes these losses to four interconnected drivers: mismanagement of materials and products, premature obsolescence, avoidable deterioration of assets, and the incomplete pricing of environmental and social externalities.  These structural issues prevent materials, products and infrastructure from reaching their full economic potential.

A missed opportunity

While the scale of losses is significant, the report frames the Value Gap as a substantial opportunity. Closing it through circular strategies—such as extending product lifetimes, increasing reuse and recovery, and designing out waste, could unlock major economic, environmental and social benefits.

It also argues that measuring the Value Gap alongside GDP would offer a more accurate reflection of true economic performance, capturing value destroyed as well as created.

Call for systemic action

The report calls for coordinated action across businesses, financiers and policymakers to address systemic inefficiencies driving the Value Gap. It urges businesses to better quantify value losses, adopt circular business models and strengthen collaboration across value chains to unlock efficiency gains and long-term value creation. Financiers are encouraged to prioritise durability, repairability and resource efficiency in investment decisions, ensuring capital flows support assets that retain value over time. Policymakers, meanwhile, are called upon to introduce pricing reforms that reflect true environmental and social costs, set clear resource-use targets and deploy fiscal instruments that incentivise circular practices and discourage wasteful consumption.