The global shipping sector requires an additional $8 billion to $28 billion annually to achieve decarbonization by 2050, warns the United Nations Conference on Trade and Development (UNCTAD). To develop infrastructure for 100% carbon-neutral fuels by the same deadline, even more substantial investments ranging from $28 billion to $90 billion annually will be necessary. The report, released before World Maritime Day, highlights the challenge of cost escalation for small island developing states and least developed countries that heavily rely on maritime transport.
Currently, maritime transport accounts for over 80% of global trade volume and contributes nearly 3% of global greenhouse gas emissions. Shockingly, emissions from this industry have increased by 20% in just the last ten years.
Rebeca Grynspan, the Secretary-General of UNCTAD, emphasized the urgent need for decarbonization while ensuring economic growth. The organization advocates for a transition strategy that is environmentally effective, procedurally fair, socially just, technologically inclusive, and globally equitable. This call comes particularly in the lead-up to the United Nations climate conference in November.
The report underlines the importance of collaboration, regulatory interventions, and green technology investments. Promisingly, 21% of vessels on order are being designed for alternative fuels. To ensure a fair transition, UNCTAD calls for a universal regulatory framework applicable to all ships. This would prevent a two-speed decarbonization process and ensure a level playing field.
In addition to the need for decarbonization, UNCTAD highlights the aging global shipping fleet, with the average age of commercial ships reaching 22.2 years at the beginning of this year. The majority of the world’s fleet is over 15 years old, posing challenges for ship owners and port terminals in navigating the evolving landscape of alternative fuels and regulatory regimes.
Digitalization is seen as a key enabler of decarbonization efforts, offering enhanced efficiency and reduced delays. Technologies such as AI, machine learning, blockchain, and the internet of things can optimize performance in terms of monitoring, routing, speed, and predictive maintenance.
Despite challenges such as the war in Ukraine and disruptions in global trade patterns, the shipping industry remains resilient. There is anticipated growth in total maritime trade volumes and containerized trade in the coming years.
In conclusion, UNCTAD’s call for a just and equitable transition to a low- and zero-carbon future in global shipping highlights the urgent need for commitment and regulatory action. A sustainable, resilient, and prosperous future for maritime transport requires timely and concerted efforts from all stakeholders.
