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US $400 billion in shipping debt 'at risk' from global warming regulations
ENVIRONMENTAL activists are promoting research that casts doubt on the value of shipping debt, saying that banks that hold $400 billion of global shipping debt are at risk.
Today, the left-wing Carbon War Room (CWR) and its ally the University Maritime Advisory Services (UMAS) of University College London says its research shows ship financing stands to be lost if its investment fail to have the green features needed to get a pass from future environmental law.
With the onset of climate policies as soon as 2023, there will be a need for significant capital investment to keep vessels competitive, said its press release.
"The research assesses whether the industry is exposed to climate policy-driven risks and how to manage these risks.
"This is not an easy time for shipping finance. Shipping will have to be more proactive and live up to the green reputation that many of their institutions hold," said its CEO Jules Kortenhorst, CEO.
Said Carbon War Room associate James Mitchell: "If a newbuild financing decision is made today, that vessel will very probably have to compete under new IMO or EU policy actions before its first drydock. This suggests that these risks should be considered now."
Said UMAS director Tristan Smith, Director, UMAS: "Future regulation on shipping [green house gases] GHG is now certain. It's just the velocity and stringency that remain unknown.
"The key takeaway from the report is for financiers and shipowners to be prepared and thus it is crucial to future-proof assets now and plan for flexibility from the onset, through for example, designing for future retrofits and using innovative financing mechanisms to deal with a variety of future scenarios," said Dr Smith.
Today, the left-wing Carbon War Room (CWR) and its ally the University Maritime Advisory Services (UMAS) of University College London says its research shows ship financing stands to be lost if its investment fail to have the green features needed to get a pass from future environmental law.
With the onset of climate policies as soon as 2023, there will be a need for significant capital investment to keep vessels competitive, said its press release.
"The research assesses whether the industry is exposed to climate policy-driven risks and how to manage these risks.
"This is not an easy time for shipping finance. Shipping will have to be more proactive and live up to the green reputation that many of their institutions hold," said its CEO Jules Kortenhorst, CEO.
Said Carbon War Room associate James Mitchell: "If a newbuild financing decision is made today, that vessel will very probably have to compete under new IMO or EU policy actions before its first drydock. This suggests that these risks should be considered now."
Said UMAS director Tristan Smith, Director, UMAS: "Future regulation on shipping [green house gases] GHG is now certain. It's just the velocity and stringency that remain unknown.
"The key takeaway from the report is for financiers and shipowners to be prepared and thus it is crucial to future-proof assets now and plan for flexibility from the onset, through for example, designing for future retrofits and using innovative financing mechanisms to deal with a variety of future scenarios," said Dr Smith.
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