A new study from UCL’s Ocean and Shipping Group suggests that the International Maritime Organization (IMO) Net Zero Framework could reduce global inequalities, but only if the revenue it generates is strategically used to support vulnerable nations. The research, published in the One Earth journal, outlines a new model for revenue distribution that prioritizes the needs of developing and low-income countries.
The Challenge of an Unequal Transition
Without a deliberate, equity-focused approach, the shift to low-carbon shipping is likely to favor wealthier countries, leaving many developing nations at a disadvantage. These vulnerable nations risk being excluded from the green transition while also facing a disproportionate increase in transport costs due to their existing higher transport costs, remoteness, and port inefficiencies. The study found that developed economies like the US, UK, and EU would face the lowest impacts on trade.
Recommended Revenue Allocation
The IMO’s Net Zero Framework, which is expected to generate at least $11–$12 billion per year by 2030 through emission pricing mechanisms, provides a significant opportunity for change. The study identifies three key areas where this revenue should be allocated to ensure a “just and equitable transition”:
- Supporting Early Movers: Funding for initial investments to help accelerate the shipping industry’s shift to clean energy.
- Enabling Technological Inclusivity: Providing targeted support for countries that have the potential for low-carbon shipping but lack the readiness due to governance, financial, or infrastructure constraints. This is particularly relevant for nations like Mauritania, Namibia, and Mozambique, which have a strong techno-economic potential but are currently excluded from the transition.
- Addressing Vulnerabilities: Using a portion of the revenue to offset increased transport costs for vulnerable countries and to fund both in- and out-of-sector investments in climate adaptation and development.
By mapping countries’ technical potential against their vulnerability to climate change and shipping costs, the research highlights that targeted investments are crucial to remove barriers to innovation and ensure a fairer transition for all.
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Source: UCL Shipping and Ocean Research Group
