China's rapid economic growth overthe past decades has been accompanied by substantialdepletion of natural resources, degradation of majorecosystems, and serious environmental pollution with adverseimpacts on human health. China's government fullyrecognizes that such trends cannot continue indefinitely andtherefore is committed to building a resource-saving andenvironmentally- friendly society as a stated nationalpolicy. It has adopted the circular economy (CE) approach asa core component of its sustainable development strategy.The ultimate objective of the CE approach is to achieve thedecoupling of economic growth from natural resourcedepletion and environmental degradation. The Chinesegovernment has been promoting CE on a number of fronts -legislation, policy reform, pilot projects, and monitoringand evaluation activities. This briefing note highlights andrecommends further actions the government should take toenhance the effectiveness of its efforts to develop acircular economy. Based on the findings and results from theWorld Bank-supported CE studies, the note focuses on fourkey areas that deserve greater attention: 1) a balanced mixof policy instruments; 2) participation by both industry andthe public in the CE approach; 3) capacity building; and 4)the role of the government and governance.