The annual emissions from shipping range between 600 and 800m tonnes of carbon dioxide, or up to 5% of the global total. This is nearly double Britain's total emissions and more than all African countries combined. 90 per cent of the world’s goods are carried by sea and world trade is increasing all the time. Carbon dioxide emissions from ships do not come under the Kyoto agreement or any proposed European legislation and few studies have been made of them, even though they are set to increase.1

The significance of shipping to the EU is reflected in the number of vessels that travel through its waters, estimated to exceed 30,000 different vessels weighing in excess of 500 gross tonnes each year. The shipping industry’s contribution to EU commerce is also reflected in its atmospheric emissions which is accounted for 2.3 million tonnes of Sulfur dioxide (SO2) and 3.2 million tonnes of Nitrogen dioxide (NOX).2

Shipping emissions have been rising for the past 20 years but have been largely ignored by governments and environmental groups. Shipping is responsible for transporting 90% of world trade which has doubled in 25 years.

SO2 and NOX emissions are currently the most important environmental problems in the shipping industry. Shipping might be the most complex area for climate policy due to several factors. First, extreme competition has lead to flagging-out and thus widespread substandard shipping. This makes implementation of climate policy instruments very difficult. Free riding is easy due to the global dimension – when ships are in international water and outside the jurisdiction of any country they can avoid fuel taxes easily. However, the growing share of shipping of global GHG emissions and the total absence of any action makes the introduction of measures necessary. If International Maritime Organization (IMO) is not able to agree to a global emissions target, Joint Implementation and Clean Development Mechanism (CDM) projects can be implemented in any case and governments should pressure the industry to enter into voluntary agreements.3


• Joint Implementation (JI) projects should be implemented by governments and industry sector for reducing emissions.
• Ports around the world should impose port fees according to the emissions intensity of the ships.
• To adopt efficient design and implementation of the vessels.
• Adopt credit based emissions trading.
• Give subsidies to promote clean shipping.
• Ships should conform with international, EU law and the United Nations convention on the Law of the Sea (UNCLOS) which sets out the basic legal framework that governs international shipping.


1. The Guardian, ‘And you thought air travel was bad for the climate …,’ 3 March
2. NERA Economic Consulting, ‘Economic instruments for reducing ship emissions in the European Union, 26 September 2006,
3. International maritime transport and climate policy, Intereconomics, 35, 3, 2000, p. 1