Danish Shipping: The EU’s Good Intentions Must Become Reality if Shipping is to Navigate Climate Struggles and War Zones

For nearly five years, the European Commission has shown its effectiveness. The EU is stronger than ever.

With a common position on Ukraine, Russian sanctions, handling an acute energy crisis and the COVID-19 pandemic, climate solutions, trade, and global market dialogue, the EU stands more united than it has in a long time, despite major global challenges.

And it must be increasingly clear to most that the EU can only assert itself globally in unity.

The direction toward climate neutrality in 2050 is set. The EU has concluded negotiations on the ambitious Fit-for-55 climate and energy legislative package.

Central to this, the European Commission has established the framework for the inclusion of shipping in the EU’s emissions trading system, which will make shipping companies pay for the carbon they emit.

A new fuel law was also passed, requiring increasing amounts of sustainable fuels to be used to power ships, replacing the heavy crude oil currently in use.

For the green transition of shipping, it is crucial to have global climate regulations that make it more expensive to emit greenhouse gases while providing an incentive for those who have already reduced their emissions.

Pressure Needed on the UN's Maritime Organisation

Therefore, it is incredibly important that EU countries now push for global rules in the UN's maritime organization IMO, where the path to shipping's climate neutrality is at the top of the agenda.

The green industry plan includes a legislative package for an industry without emissions – the Net-Zero Industry Act. This is important for Danish shipping on several fronts.

Firstly, it increases the speed of approval for new projects for sustainable energy, including offshore wind farms, which can provide green electricity to produce alternative fuels for ships.

Secondly, it aims for 40 percent of shipping's fuel needs to be produced in the EU by 2030.

Finally, there are goals for the EU to be able to store 50 million tons of CO2 annually by 2030, with maritime transport and the North Sea's storage playing a key role.

The EU thus has the right ambitions for climate neutrality. And it is well on its way to putting the necessary climate regulation in place.

Far from Vision to Reality

But the EU is also far from ensuring that the fine words and ambitions become reality, when it comes to producing the large amounts of green fuels necessary to realize the dream of climate neutrality.

There must be action behind the words. This will be an important task in the next parliamentary term.

The Commission's green transport package, which aims to optimize freight transport across road, rail, and sea within the internal market and reduce CO2 emissions, got off to a poor start and did not reach its goals.

The proposal can be advantageously rewritten and combined with the newly launched Enrico Letta-report on a stronger internal market, including clear goals and actions for short sea shipping, ensuring more cargo is moved by sea and reducing administrative hassles with customs and VAT.

The tense geopolitical situation and ongoing war in Europe will place increasing demands on the EU. As Danish Prime Minister Mette Frederiksen said in her New Year's speech:

"The center of gravity is shifting. Europe is losing influence economically, te­ch­no­lo­gi­cal­ly, and de­mo­grap­hi­cal­ly."

The global focus is shifting along with the agendas in China, India, Indonesia, Japan, and South Korea. Challenges in the Red Sea, the Middle East, and the war in Ukraine.

The EU protects our seafarers and ships. The EU adopted a new maritime security strategy, a joint effort to protect the EU from security threats such as piracy and smuggling, but also new threats to critical infrastructure.

The EU is Essential in a Conflict-Filled World

In February 2024, the EU decided to launch the naval operation ASPIDES.

The purpose is to protect shipping and free navigation following a series of attacks on civilian maritime traffic by the Yemeni rebel movement Houthis off the coast of Yemen in the Red Sea and the western part of the Gulf of Aden.

This is in collaboration with the international coalition led by the USA, which, with Operation Prosperity Guardian, aims to restore maritime security in the area.

The EU's global voice was also heard with renewed trade agreements with New Zealand and Chile, as well as an economic partnership with Kenya.

Negotiations with Australia fell through, dialogue with the MERCOSUR countries Argentina, Brazil, Paraguay, and Uruguay has stagnated, but progress has been made in dialogue with India, Indonesia, Thailand, and Mexico.

Global Gateway is an interesting initiative that the EU and businesses should continue to work on alongside trade agreements.

The project helps promote the EU’s role as an effective global actor by delivering quality investments in developing countries, including the production of sustainable energy, alternative fuels, and infrastructure that facilitates trade with the EU.

The EU is more important than ever.

Not least for shipping. We need a strong EU in an unpredictable, conflict-filled, and changing world.