Loved by some, criticised by others, the shipowner groups proposal to create an international research and development fund found itself passing its first hurdle, albeit with a lot ore work to be done.
The proposal by the shipping lobby groups to create an international maritime research and development board and fund received a somewhat warm response (the official phrase is “give further consideration to”) from the IMO delegates that were logged into the week long marine environment protection committee meeting.
In an extremely truncated meeting, beset with technical and communication problems the committee chairman eventually got to the proposal by ICS, Bimco and others only to see the debate move swiftly into the relevance of discussion a market based measure (which some saw the proposal as) and how it could be linked to any mid and long term decarbonisation efforts.
ICS made a big splash about the proposal at the beginning of the year, hoping to see a growth in support ahead of being debated at an MEPC meeting that was scheduled for spring 2020, only to see that postponed due to the Covid-19 pandemic travel restrictions.
The proposal likely benefited from being discussed in a virtual setting, and ICS is positive of the outcome in a press statement during the last hours of the meeting.
Simon Bennet claimed that “just about every government that spoke highlighted the critical importance of R&D, and a large number of governments, probably representing the majority of the world’s tonnage, supported the concept of an IMO supervised Fund.” However there was certainly no lack of subtle amendments and changes, even in the last prolonged closing hours of the MEPC meeting as delegations argued (many from their homes) how the Committee’s response should read.
One of the sticking points was the concern that the proposal contains a market based measure to raise revenue, and therefore should not be discussed at this point given the discussions on how the short term measures have yet to be fully agreed. But while some delegations took the more cautious approach others were certainly more bullish, even suggesting the ICS proposal to propose a $2 per tonne of fuel bunkered by shipping was far too low to promote or create direct change in shipowner behaviour.
The proposal is to collect $5bn over a 10-year period through a contribution of $2 a tonne of fuel consumed by every ship, and the money to be used by a fund that would be administered by an independent fund body managed possibly the IMO.
However ICS has long said that this contribution should not be seen as a tax, levy or any other market-based-measure, but the starting point to fund overarching research and development (listen to an earlier episode of the Aronnax Podcast with ICS’s Guy Platten and Simon Bennett).
Member states were however agreed on one point that the proposal urges, namely that the R&D fund should address the least developed countries and the low island developing states.
MEPC will now not meet until June 2021, but the committee chairman has agreed to some intercessional meetings and correspondence groups to be established to further develop some of the proposals and papers submitted into this recent meeting ahead of the next. There is also a growing backlog of work due to the nature of the digital meetings, which is alarming some delegations.