The European Union, Japan, Canada, and climate-vulnerable Pacific Island states happen to be among the 47 countries looking out to get support for a charge on the international shipping sector’s greenhouse gas emissions, Reuters documents showed.
The documents that are being discussed at an International Maritime Organization- IMO meeting happen to be entering a second week and go ahead and outline four proposals with an overall 47 backers for imposing a fee on each tonne when it comes to the greenhouse gas the industry produces.
It is well to be noted that the support for the idea has gone on to more than double from the 20 nations that happen to publicly support the carbon levy at the French climate finance summit in 2023.
Backers go on to argue the policy could as well raise over $80 billion in funding in a year that could be very well reinvested so as to develop low-carbon shipping fuels and, at the same time, also support poorer countries to transition. Opponents, such as China and Brazil, say it goes on to penalize emerging economies that are trade-reliant.
Those nations happen to be competing to win over dozens of others, including most of the African nations, which, according to the diplomats, have yet to take a robust stance on the issue. The IMO takes decisions by way of consensus; however, it can also do so by way of majority support.
In 2023, the U.N. agency agreed to target a 20% emissions reduction by 2030 and net zero emissions by around 2050. While countries went ahead and agreed in talks last week to continue negotiations on the price of emissions, the official meeting summary went on to note that they happened to be split on numerous issues with regards to the idea.
The IMO delegate for the low-lying Marshall Islands, Albon Ishoda, went on to say that levy happened to be the only credible route so as to meet the IMO’s goals.
The point is that if this is not passed, what are the choices available? Because they have already agreed on certain targets is it the fact that going back to the drawing board is inevitable.
It is well to be noted that shipping, which transports almost 90% of the world’s trade, accounts for around 3% of the world’s carbon dioxide emissions, a share anticipated to expand in the decades to come if there are no tougher anti-pollution measures in place.
It is worth noting that a proposal that was tabled by the Marshall Islands, Vanuatu, as well as others, despite their high reliance on shipping, has gone on to demand an emissions levy for years and proposes a charge of $150 for every tonne of CO2.
Researchers have gone on to say that the $150 carbon price could go on to make investments in low-carbon ammonia-fuelled systems economically viable as compared with conventional ships.
The Disagreement
China, Brazil, as well as Argentina pushed back on the very idea of a CO2 levy in IMO talks in 2023. A study run by Brazil’s University of Sao Paulo went on to find that a carbon tax on shipping would go ahead and cut GDP all across the developing countries by 0.13%, with Africa as well as South America among the regions that would be hardest-hit.
A Brazilian negotiator went on to say that Brazil as well as other developing countries were looking out for a swift energy transition with minimal disruptive effects on their economies, specifically for countries that go on to rely on sea-borne trade.
Apparently, a proposal by Argentina, Brazil, China, and others goes on to advocate a global fuel emissions intensity limit, with a financial penalty for breaches as a choice. This would mean that if countries happened to completely comply with the standard of fuel, no emissions would go on to face the fee.
As per the Brazilian negotiator, they will not be in favor of a levy that’s flat and likely to hurt developing countries, but they would definitely be in favor of a good levy that’s applied to only emissions, and that too over a certain benchmark.
In spite of the differences of opinion, member states happen to be still attempting to agree on global steps so as to avoid more countries that happen to be targeting the industry on a national level.
That would go on to fragment the market with local standards that are varying and cause a headache in case of companies shipping goods across the world.
