Shipping Industry Divided Over Proposed Emissions Levy Allocation

The shipping industry and maritime ministries want a proposed emissions levy to focus on cleaning up the sector, rather than broader climate goals. With rich countries failing to meet climate finance promises, attention is turning to innovative sources like levies on ships. Negotiations at the International Maritime Organisation are ongoing.
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The shipping industry and maritime ministries are at odds over a proposed levy on emissions, with negotiators at UN talks pushing for the revenue to be primarily used to clean up the industry rather than address broader climate goals. As rich countries have failed to provide promised funds to help developing nations combat climate change, attention has turned to innovative sources of finance, such as levies on ships, planes, or fossil fuel firms. However, at the International Maritime Organisation (IMO), governments are advocating for the majority of funds from a shipping emissions levy to be directed towards making it easier for companies to use clean fuel in their vessels.

While some Pacific nations are advocating for a portion of the funds to be used outside of the shipping industry, the prevailing sentiment among governments and industry stakeholders is to focus on cleaning up the sector. The industry emits a significant amount of greenhouse gases comparable to Germany, and efforts are underway to achieve net zero emissions by 2050. Various proposals suggest using the revenue from the levy to invest in research, clean fuels, and training for a more sustainable shipping industry.

There is a debate over how the funds from the shipping emissions levy should be allocated, with some advocating for a focus on cleaning up the industry and others calling for a broader approach to address climate impacts. While the shipping industry and maritime ministries are inclined to keep the funds within the sector, there are calls from experts and campaigners to consider using a portion of the revenue to support climate-vulnerable communities outside of shipping. Discussions are ongoing at the IMO to determine how to raise and allocate the funds, with a decision expected within the next year.

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