BIMCO decarbonisation panel: "Are we sorted?"

Published: 16 June 2022

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Engaging maritime leaders and specialists - and viewing the increasing optimism regarding a global market-based measure following the recent IMO intersessional meeting - BIMCO Secretary General & CEO, David Loosley, kicked off the discussion asking if our industry is sorted.

“So, is that it? Are we finally sorted with a global market-based measure coming, and are we collectively taking all the right steps that are required to allow us to decarbonise?”

The “No Turning Back: Decarbonisation in practice” event was hosted by BIMCO’s President Designate, Nikolaus Schües, and panellists shared their expertise, ambition, and strategies for decarbonising shipping.

The 3.7 trillion dollar question

“So, is this it? Definitely not,” said Eman Abdalla, Global Operations Director of Cargill Ocean Transportation.

She argued that a global market-based measure must be just, equitable, transparent, and predictable, and should not be a disadvantage to some. Also, a vast amount of investment is needed.

“To make zero carbon shipping a reality it’s 3.7 trillion dollars over the next three decades,” Abdalla said and added: “More work is to be done but there is light at the end of the tunnel, providing that we finally get the right market-based measures that will allow us to make the right investments going forward.”

She also pointed out that she has a lot of confidence in the multilateral discussions currently taking place at the International Maritime Organization (IMO) and an equal amount of faith and confidence in the industry.

“Are we on the right path? Our answer is yes,” she said.

Who should pick up the bill?

Also supporting global market-based measures was Jerry Kalogiratos, CEO of Capital Maritime, pointing out that this can help the industry in its quest for the technologies that will get it to net zero.

“However, I think we need three key ingredients if we are to proceed: firstly, they have to be truly global, the shipping industry cannot be expected to pay twice for the same emissions. Secondly, we are discussing something that should be very obvious: the polluter pays. And thirdly, the question is how do you use the proceeds? If there is one very important use of such proceeds, it is to fund new technologies that will get us to net zero,” Kalogiratos said.

Collaboration and who should pay the bill was also on the mind of Ioanna G. Procopiou, Managing Director of Prominence Maritime S.A. & Sea Traders S.A.

“We have to stop pointing fingers. We are all responsible for reducing our footprint. There is a big debate about who the polluter is. Is it the taxi? Is it the taxi driver? Is it the passenger that says to go fast or to go via a specific route?” she asked, adding:

“It is quite a shame that it is not even agreed who the polluter is. Instead of pointing fingers, we should try and find a collaboration because it is an urgency; we need to reduce our footprint generally as an industry.”

Timing is crucial

Dimitrios Patrikios, CEO of Kyklades Maritime voiced concern over the timing of market-based measures:

“The near future to me seems very foggy. I am very concerned that the marked-based measures will finally accelerate as long as the future fuels are not in sight for international use, and we don’t have a holistic view in the energy position.”

“We cannot fuel our ships with promises and faith,” he said, adding that the question is how to mobilise the necessary resources and investments that are needed to develop the new fuels in quantities.

No leaning back

BIMCO’s Deputy Secretary General, Lars Robert Pedersen, tackled the question of whether the shipping industry will meet the IMO’s decarbonisation goals because of or despite the IMO:

“Certainly, I think, it is a fact that we will not need the IMO’s decarbonisation goals because of the IMO, in the sense that we all lean back and sit and wait for the IMO to solve the issues for us. That is not the point,” Pedersen said.

He pointed out that the IMO will make some measures to assist the industry in doing what needs to be done, and that collaboration on a very large scale is key because shipping is very dependent on greater society.

“We all have to remember that it is not because the IMO figured out that we need to tackle climate change that we have to decarbonise shipping. It is actually because the world has decided on a Paris agreement that we need to do something rapidly to decarbonise. Obviously, shipping has to fulfil its part,” Pedersen said.