International Chamber of Shipping slams International Transport Forum’s suggestion for a carbon tax

International Chamber of Shipping slams International Transport Forum’s suggestion for a carbon tax

The International Chamber of Shipping (ICS) has attacked the recommendation for a carbon tax on shipping made by the International Transport Forum (ITF) in a policy brief authored by its administrator for ports and shipping, Olaf Merk.

The ICS questioned why international shipping should accept a carbon price of US$25 per tonne of CO2, as proposed by Merk, which it said would be almost three times the price paid by shore based industries in developed nations.

According to ICS, which is the shipping industry’s principal trade association, given that the UN Framework Convention on Climate Change (UNFCCC) recognises that developed and developing nations should accept different commitments, shipping should not be considered differently.

Peter Hinchliffe, ICS’s secretary general, said: “While shipping may currently have CO2 emissions comparable to a major OECD economy, it is inappropriate for the ITF to propose that the industry should be treated like an OECD economy.”

As the recommendation was made in a policy brief, indicating it was not vetted or endorsed by ITF member countries, the recommendation is not attributable to the 57 ITF member countries.

The ICS added that about 70% of the world merchant fleet is registered in the UNFCCC as Non-Annex I developing countries and maritime trade is of “vital benefit to rich and emerging economies alike.”

The trade association admitted that shipping has a responsibility to contribute to the achievement of the UN ‘two degree’ climate change goal, adding that the industry reduced its total CO2 emissions by more than 10% in the period between 2007 and 2012, as well as CO2 per tonne-mile by around 20% from 2005 to 2015.

According to the ITF’s report, which was published ahead of the UNFCCC 21st Conference of Parties (COP21), to be held in Paris, France, in December 2015, “an emission target for the shipping sector was proposed in April 2015 by the Marshall Islands, but not acted upon within the IMO (International Maritime Organisation).”

However, ICS commented that the think-tank’s report, authored by Olaf Merk, administrator of ports and shipping at the ITF, was incorrect in its statement.

The trade association said: “The issue was placed on the agenda of the next IMO Marine Environment Protection Committee, and will be debated fully by IMO in April 2016, taking account of the outcome of the UN Climate Conference in Paris.

“The shipping industry, as represented by ICS, plans to respond positively during the IMO debate about possible targets.”

The ICS also reiterated its preference for a fuel levy in the event that IMO member states decide to adopt a shipping market based measure (MBM).

“However,” it added, “if a levy was developed by IMO, ICS believes that any money collected should be proportionate to international shipping’s share of the world’s total CO2 emissions (2.2% in 2012 compared to 2.8% in 2007), not the US$26bn a year suggested by the ITF.”

An ITF spokesperson told CM that there is agreement between the policy brief and the ICS that shipping CO2 emissions are best addressed through an MBM, and that a tax would be the best way to implement this, although it acknowledged that the level of this tax could be disputed.