Can we ever win?

Malcolm Latarche
Malcolm Latarche

20 May 2016


Yesterday, the OECD issued a new report The Ocean Economy in 2030 covering all aspects of the subject including shipping and shipbuilding. According to the report, ‘looking to 2030, many ocean-based industries have the potential to outperform the growth of the global economy as a whole, both in terms of value added and employment. The projections suggest that between 2010 and 2030 on a “business as usual” scenario basis, the ocean economy could more than double its contribution to global value added, reaching over USD 3 trillion. Particularly strong growth is expected in marine aquaculture, offshore wind, fish processing, and shipbuilding and repair. Ocean industries also have the potential to make an important contribution to employment growth. In 2030, they are anticipated to employ approximately 40 million full-time equivalent jobs in the business as usual scenario. The fastest growth in jobs is expected to occur in offshore wind energy, marine aquaculture, fish processing and port activities’. However, not everything is looking so rosy as the report also highlighted the current annual rise of $500mn in container lines costs and the potential for an extra cost of anywhere between $5bn and 30bn when the global sulphur cap drops to 0.5% in 2020 or 2025 depending on the review to be carried out by the IMO. Ordinarily such reports are missed by the world outside of shipping but at least this was reported also by Reuters so may gain a wider audience. Of course the figures have little meaning to the wider population who seemingly do not link them to rising costs of food and consumer items. This year with many liner services operating below cost levels, they may not realise that the shipping industry is in effect subsidising consumer spending and taxation to a significant degree. The costs to shipping identified in the report are purely those related to meeting sulphur rules but there are many more including ballast treatment, ECDIS and possibly even CO2 charges on the cards. The problems associated with sulphur mainly centre around the inevitable SOx emissions that result from burning fuel containing sulphur but it is hard not to be confused when regular scientific reports and studies continue to be issued into the possibilities of reducing global warming by seeding the atmosphere with sulphates (SOx to most of us) because of their cooling effect. In many of these studies the beneficial effect of shipping emissions are mentioned. Reducing emissions will not only be costly according to the OECD but will actually make global warming worse according to scientists.