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Speech: Prospects and challenges of the European shipping industry

Date: 09/04/2014

European Community Shipowners' Association (ECSA) Seminar

Ladies and gentlemen

Maritime transport is a cornerstone of European industry. It plays an essential role in Europe's economy. The report presented today is a welcome reminder of this.

For me there is no doubt that Europe needs a high-quality shipping sector that can compete around the world. A sector where service quality, high levels of safety, environmental protection and operational efficiency win out over protectionism and low-cost sub-standard services. We are working hard with our partners outside the EU in trade and maritime transport to make sure of this.

Shipping rarely attracts media headlines. But when it does, this is more often because of accidents such as the Costa Concordia, Prestige or Erika, than because of its reliability and efficiency. As industry and as regulators, we need to do our utmost to prevent these kinds of disasters from happening again. They cast a shadow over shipping - despite its reputation as one of the safest and cleanest forms of transport.

Intra-EU shipping

Let me first say a few words about shipping inside the EU before I return to the global situation.

To reach our goal of shifting more traffic to sea, it has to be as easy for cargo to move across the EU on a ship as it is on a truck. This was the whole point of the Blue Belt initiative. The Blue Belt aims to extend the single transport market to shipping services, where customs administrations can follow ship and cargo movements, and where movements between EU ports are no longer treated as arrivals from overseas.

As you know, I am impatient to see this happen. And until recently, I was under the impression that it would happen soon. But now I hear there are sudden doubts about the feasibility of the e-manifest: a simple tool that would be enormously useful to raise Europe's competitiveness. I am now very concerned about whether we will see the e-manifest become a reality as soon as we had thought - and wanted.

But this is not the only initiative for reducing red tape and complexity involved in administration. As of 2015, the new Reporting Formalities rules will mean that ships only need to report once when they arrive at a port. The information will be available electronically to all relevant authorities and re-used as much as possible. This makes life easier for everyone – shipmasters, agents, owners and authorities. It brings shipping into the 21st century. After 2015 it is planned to explore further next steps to continue reducing the administrative burden for shipping.

The Commission has set up the European Sustainable Shipping Forum. Its dual objective is to progress on common solutions to environmental challenges and to increase the competitiveness of EU shipping. For example, we are now looking at issues related to low sulphur fuel, the use of scrubbers and using LNG as a marine fuel.

I would also like to mention the need for adequate state aid guidelines so that Europe can properly match its international competition. With today’s rules, we have achieved a good compromise between the specific needs of the sector and the general orientation of strict European rules for state aid. I know that many of you would like to adapt the rules further. While I have a certain degree of sympathy, I also know that this is not for the maritime sector to decide on its own. We need to keep an eye on the wider context.

Global regulation for a global industry?

Ladies and gentlemen

I share the belief of many of you that for an industry as global as shipping, we need to look to global regulation developed at the International Maritime Organization. I have been a strong supporter of the IMO within the Commission and with national ministers. Both the EU and IMO have a common goal of safe, secure and sustainable shipping around the world. It is our shared responsibility to demonstrate that global regulation works effectively. I therefore fully subscribe to the IMO's 2014 headline – "effective implementation of IMO conventions". It is up to us to help the IMO deliver.

Let me give two examples:

We are convinced it is now time to raise the level of safety that existing IMO regulations provide for the stability of passenger ships. Recent research has shown that their damage stability could be considerably increased. We think it is possible for a passenger ship carrying 6,000 people to survive 97% of all possible collisions – with minimal additional building and operational costs. It appears that current regulations statistically imply one major accident [like the "Estonia" ferry accident in 1994] occurring every 20 years. We think that, if this risk can be reduced to one such an accident in every 100 years, as research results show – then we should do it.

Rising emissions from shipping are another concern. As industry and regulators, we need to demonstrate together that we can deal with this issue effectively. It is clearly in our shared interest to show we are capable of reducing shipping emissions without compromising the sector’s economic performance.

I believe it should be possible to find an acceptable global solution for further reducing greenhouse gases, working together as we did with the Energy Efficiency Design Index. The EU, together with a multitude of partner countries and industry voices, proposes to build on that success by setting up a global system to collect data on fuel consumption and emissions.

I very much welcome the constructive engagement of industry. Your concrete contributions and understanding that it is important to act swiftly is essential to get such a global system in place. Too long a delay on this would represent a real danger.

Improved environmental protection does not need to lead to extra costs. I am convinced that it can also offer a number of opportunities, even in the hard times that shipping faces today. Reducing fuel consumption by raising efficiency not only means lower CO2 emissions but also lower fuel bills. It will also give European shipping a competitive advantage against rivals worldwide, or against other forms of transport at home.

These examples show for me that, by uniting our interests, the IMO can act forcefully. I know Member States, industry and the Commission do not always see eye to eye. But let me say clearly: we need to help each other to make sure that the IMO delivers safer and cleaner shipping, based on equal conditions for competition around the world. This is the way to act if we want to avoid the threat of unnecessary regionalisation, which is always around the corner. The shipping industry can only win from this approach.

Ladies and gentlemen

For any service industry people must be at the heart of the business. People are what makes or breaks the sector, whether they are Europeans or not, officers or ratings. Europe is blessed with a wealth of experience, with more 220,000 EU seafarers, some 18% of all seafarers in the world. But it remains a challenge to attract new recruits into the shipping profession; Despite shipping increasingly offering a high tech and management careers.

With their specific "know-how" and expertise, experienced seafarers play an important part in developing the wider maritime cluster. The range of the roles they are needed in after a seagoing career is vast: in shipping companies, shipyards, marine equipment companies, pilotage services and maritime law firms. They could also become port or flag state officers, harbour masters, join classification societies or work in other transport or logistics roles where maritime expertise pays off. In all these cases Europe needs strong seafaring expertise to maintain and develop EU industrial competitiveness. I believe we need to continue to help making maritime professions more attractive.

Ladies and gentlemen, at the end of my remarks, let me return to my opening point: We want shipping to prosper, to provide more and better employment and to drive innovation, so that it can serve a flexible, sustainable and competitive European economy.

I have one request and some thanks.

My request: to you to continue to engage, as an industry, early and constructively with regulators. I think we have seen over the last years that all sides can win if shipping is part of the solution – be the issue environmental, social or economic. And also that we can lose out if society is convinced that shipping is closing its eyes to the needs of reform.

My thanks: go to ECSA, in particular, for the pragmatic, stimulating and trustful cooperation over these years.

I wish you an ever safe, prosperous and clean journey.

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