In 2015 Tony de Brum, then foreign minister of the Marshall Islands, came to the International Maritime Organisation (IMO) in London to deliver a simple message: international shipping must decarbonise or be responsible for destroying his country.
International shipping could be responsible for nearly a fifth of the world’s carbon emissions by 2050. If the IMO, the branch of the UN that regulates international shipping, failed to set ambitious climate targets, it would be disastrous for low-lying islands like his own, de Brum would say.
But when he walked in to the IMO plenary, de Brum found strangers sitting in his country’s place. “I was talking about a Goldilocks situation,” he told Climate Home two years later on the verandah of his bungalow on the Marshallese capital atoll Majuro, a few feet from the lagoon. “We had some difficulty convincing the people who were sitting in our seats, literally, that we were the representatives of the Marshall Islands.”
The people de Brum found representing the Marshall Islands were from International Registries Inc. (IRI), a private shipping register headquartered in Reston, Virginia. According to its website, the company provides access to the Marshall Islands flag and a “zero tax jurisdiction that statutorily exempts non-resident domestic corporations from taxation on their income and assets”.
Thanks to IRI, the Marshall Islands boasts the second largest fleet of ships in the world and the world’s largest fleet of oil tankers. The company attracts ship owners with the promise of zero corporation tax and no seafarer nationality requirements – the latter allows them to skirt organised labour. The 45,000 offshore companies registered with IRI also benefit from corporate anonymity.
De Brum, now climate change ambassador for the Marshall Islands, said he was “appalled” by IRI’s suspicious response to his arrival at the IMO.
He did eventually deliver his message. But two years on, the shipping industry remains out of step with the rest of the world on climate change. In 20 years, the IMO has made just one intervention to address carbon emissions: an efficiency index which the International Energy Agency said would only improve efficiency by 1% between 2015 and 2025. A new study by CE Delft found ship efficiency actually got worse in 2016.
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De Brum’s intervention revealed a struggle between the world’s second largest shipping registry and its flag state over who the IMO really serves – sovereign states or the shipping industry? The issue of climate change has starkly exposed the divergent interests of the islands and the registry. It also highlights deep cultural issues within the IMO – a UN body where delegations are invariably stacked with industry representatives and national interests are oddly peripheral.
This week, that contest entered a new phase as transport minister Mike Halferty arrived at the IMO’s annual meeting, the first time a Marshallese minister has attended since de Brum’s jarring experience. The IMO has committed to publishing an interim climate plan by 2018 and Halferty wants to use the meeting to push for deep cuts. “The IMO must this week send a very clear signal that it will take serious and ambitious climate action and that it will play its full part in delivering the goals of the Paris Agreement,” he said in a statement.
Carbon emissions from shipping aren’t included in national governments’ contributions under the Paris climate agreement. Instead, they are regulated by the IMO. Almost 80% of the world fleet is registered to ‘open registries’ – many of them run by private companies. Because IMO treaties only come into force on the basis when a certain proportion of the world fleet has backed them, the international law made at the IMO stands or falls on the support of companies like IRI.
“Some of the most vulnerable small island states [are represented] by the private companies running their open ship registries, with positions taken at IMO often at odds with their national interest and their positions in the wider climate negotiations,” said John Maggs of the Clean Shipping Coalition, an NGO.
According to participants lists seen by Climate Home, the Marshall Islands’ Pacific neighbours in Palau are also represented at the IMO by a private registry; and both Vanuatu and the Marshall Islands have previously attended meetings with oil industry advisors.
According to Maggs, this system “puts a disproportionate influence in the hands of the shipping industry, and is one of the reasons why, 20 years after [the Kyoto climate protocol], we are only now taking the issue of climate change seriously at IMO”.
A spokesman from the IMO said: “Member states decide themselves who represents them at IMO meetings and speaks on their behalf. It is entirely down to the member states. All member states have equal status and it is one state one vote.”
For the Marshall Islands, it is an invidious position; trapped between rising seas and a sense of dependence on one of their few economic staples. There are real fears the registry could simply move to another, more pliant country.
Rather than de-registering the country’s huge tanker fleet, which could easily move to another tax-free register, de Brum’s vision had been a reformed register that would incentivise green shipping, as well as use its significant tonnage to influence the stagnated debates on shipping emissions at the IMO.