The circular economy (CE) has been a European Union (EU) priority since 2014, when first official document on the CE was published. Currently, the EU is on the road to the transformation from a linear economy model to the CE model. In 2019, a new strategy was announced – the European Green Deal, the main goal of which is to mobilize the industrial sector for the CE implementation. The CE assumes that the generated waste should be treated as a secondary raw material. The paper presents an analysis of the possibility of using selected groups of waste for the production of fertilizers. Moreover, an identification of strengths and weaknesses, as well as market opportunities and threats related to the use of selected groups of waste as a valuable raw material for the production of fertilizers was conducted. The scope of the work includes characteristics of municipal waste (household waste, food waste, green waste, municipal sewage sludge, digestate), industrial waste (sewage sludge, ashes from biomass combustion, digestate) and agricultural waste (animal waste, plant waste), and a SWO T (strengths and weaknesses, opportunities and threats) analysis. The fertilizer use from waste is determined by the content of nutrients (phosphorus – P, nitrogen, potassium, magnesium, calcium ) and the presence of heavy metals unfavorable for plants (zinc, lead, mercury). Due to the possibility of contamination, including heavy metals, before introducing waste into the soil, it should be subjected to a detailed chemical analysis and treatment. The use of waste for the production of fertilizers allows for the reduction of the EU’s dependence on the import of nutrients from outside Europe, and is in line with the CE.

We analyze the medium- and long-run effects caused by an inflow of capital into a labor-abundant country. For that purpose, we incorporate directed technical change into a Heckscher-Ohlin model with a continuum of goods. This provides a comprehensive theory explaining the dynamics of comparative advantage based on differences in effective factor endowments, i.e. factor endowments adjusted by differences in technological levels. Our model constitutes an appropriate framework for understanding, e.g., the empirically observed changes in industrial structures of Central and Eastern European countries. Furthermore, we provide a theoretical foundation for the empirical Prospective Comparative Advantage index with new insights into the future dynamics of comparative advantage. Eventually, we show the importance of research spillovers and state dependence on the process of convergence.