GENEVA: The United Nations on Wednesday called for the rapid decarbonization of the global shipping industry, citing the potential price tag of exceeding $100 billion annually to tackle the sector’s escalating emissions.
The United Nations Conference on Trade and Development (UNCTAD) emphasized the crucial role that shipping plays in the global economy, facilitating the movement of over 80 percent of all traded goods worldwide. However, it also highlighted the industry’s significant contribution to greenhouse gas emissions, accounting for nearly three percent of global emissions.
While industries face mounting pressure to reduce their carbon footprint to combat climate change, emissions from the maritime fleet have surged by 20 percent in the past decade.
UN Secretary-General Rebeca Grynspan stressed the need for urgent global action to decarbonize shipping. She emphasized the challenge of balancing environmental sustainability, regulatory compliance, and economic considerations for the industry’s prosperous and equitable future.
UNCTAD called for a swift transition to cleaner fuels within the shipping industry, where almost 99 percent of the global fleet still relies on conventional fuels. Shamika Sirimanne, head of UNCTAD’s technology and logistics division, noted that the shift to alternative fuels in shipping is still in its early stages.
While some progress has been made, with 21 percent of vessels on order designed for alternative fuels, UNCTAD underscored the urgency to accelerate the pace of change. However, it acknowledged that this transition would come at a significant cost.
UN Estimates $100 Billion Annual Costs for Decarbonization
According to the UNCTAD report, decarbonizing ships by 2050 would require up to $28 billion in annual investments. Moreover, developing the necessary infrastructure for 100 percent carbon-neutral fuels could necessitate annual investments of up to $90 billion by that time.
