Abstract:
Environmental pollution and resource depletion are increasingly adversely affecting human life, requiring many countries to actively build and develop a circular economy, including Vietnam. Besides, Vietnam participates in many new-generation free trade agreements and commitments to safety standards and the ecological environment. Applying the circular economy is an inevitable trend toward sustainable development. Building a circular economy model has a close relationship with factors such as: Reduce, Reuse, Recycle, Rethink, and Refuse. They have played an essential and groundbreaking role in shaping closed-loop systems. Therefore, the article aimed to discover critical factors affecting the circular economy and proposed policy recommendations. The authors applied qualitative and quantitative methods to process data through SPSS 20.0. The authors surveyed 450 leaders and other people working for 30 provinces in Vietnam. Based on structural equation modeling, the authors tested the overall fit of the data. The main findings explored the Reduce (Red) factor as the most substantial impact of the five factors affecting the circular economy, with a significance of 1.0 percent. Based on the research, the authors proposed the policy recommendations such as a clear legal corridor for the formation and development of the circular economy, mechanisms and policies for developing advanced technology, reuse, and recycling of waste. The article's novelty has analyzed the policies that Vietnam is trying to develop economically sustainably, minimizing adverse impacts on the environment, and the circular economy is a model of interest and development orientation.