In an exclusive interview to SAFETY4SEA, Margi Van Gogh, Head of Supply Chain & Transport Industries, World Economic Forum, highlights that this is a decade of decision for the maritime industry, which is currently in a transition phase.
Decarbonization is a top priority providing many opportunities, she argues, suggesting industry to ensure demand of alternative fuels, collective action, innovation and foster trade opportunities that will explore potential for emerging economies and low income economies to transform their national energy production.
SAFETY4SEA: What does the word ‘sustainability’ mean for the maritime industry? What is the leadership required to shape a sustainable future of global shipping?
Margi Van Gogh: The challenge for the maritime industry is to transition to a zero-emission future while continuously facilitating global trade driving economic development. We need to accelerate decarbonized and resilient supply chains, and the ambition of achieving zero emission shipping by 2050 is at the core of that. The industry has recognized this, and with the Getting to Zero coalition there is strong sense of urgency and willingness to move the needle. Individual companies are showing leadership to move first, and we must also ensure the international regulatory framework follows through, with countries showing leadership in negotiations to raise ambitions and create a global level playing field.
S4S: Do you believe the maritime industry is moving in the right direction? What do you see as the defining ESG trends driving maritime toward the future?
M.V.G.: Since we launched the Getting to Coalition in the Fall of 2019 with Global Maritime Forum and the Friends of the Ocean Action much has progressed. Some elements of progress as a direct consequence of this strong coalition of the willing, but also many other factors impacting fundamental perceptions across the maritime industry. The maritime industry as a hard-to-abate sector with many long-term investment assets really started to view impossible as possible, and begun exploring fuels and vessel solutions regardless of the chicken and egg discussion. This is a significant step forward and represents the ambition of the industry to actively lead, and the companies partnering in the joint World Economic Forum and US State Department initiative, as First Movers, are great examples of that.
S4S: Following this year’s World Economic Forum Annual Meeting in Davos, what is your wish list for the industry and/or regulators and all parties involved towards climate change?
M.V.G.: This is urgent. The latest published IPCC report reiterated a ‘code red for humanity’. Shipping alone contributes 2-3% of global emissions and is on a path to increase if not addressed. The companies and organizations at the World Economic Forum Annual Meeting in May fully recognized this. Our wish list is that we continue to unlock the potential of collective action and collaboration to achieve zero-emission by 2050 at the latest; get the entire maritime value chain engaged and actively involved; and look at the opportunities this can spur also for developing countries to become part of the global fuel supply chain, as we transform the way we think about and invest in fuel infrastructure.
S4S: What are the top priorities in your agenda for the next five years that relate to a more sustainable future for the maritime industry?
M.V.G.: The next five years are crucial. This is the decade of decision. With many assets operational for 20+ years in the maritime industry, the transition must start now and has started already with some of the top priorities being engine and vessel design, and development of the fuel infrastructure. In essence, this is about innovation and supporting innovation. We need to ensure a strong demand signal that vessel owners will be buying alternative fuels, but also that shippers and cargo owners will be demanding space on vessel sailing on alternative fuels. In parallel, and especially for the next five years, we need to increase our efforts in the near-term abatement space, harnessing every possible technology to slow the pace at which we are approaching the emissions cliff.
S4S: From your perspective, what are the key barriers/challenges that the maritime industry is currently facing with regards to decarbonization?
M.V.G.: Uncertainty. Like so many other hard-to-abate sectors, uncertainty is playing a crucial role when you look across factors such as innovation, regulatory framework, and financing and investments. Some of the barriers we can tackle across the sectors. Such as some areas within policy and the collective demand for alternative fuels, while others are challenges specific to the maritime industry such as vessel design, innovation and infrastructure.
S4S: They say that there is a gift/opportunity in every challenge. Given the challenges that shipping is facing in way of decarbonization, what sort of opportunities do you identify?
M.V.G.: The opportunities are plenty if we solve for this in the right way and focus on an inclusive way forward. This includes opportunities to create new green jobs and generate trade opportunities as part of the maritime fuel infrastructure development. These opportunities are particularly important for emerging economies and low income economies to transform their national energy production. This is a key opportunity to continue to foster. Specifically, I would bring attention to a recently published report from a P4G and Getting to Zero Coalition collaboration exploring potential for South Africa benefitting from international maritime decarbonization. We are publishing similar reports for Mexico and Indonesia as part of the collaboration.
S4S: As we move forward, how do you feel the challenges of digitization will impact the maritime industry?
M.V.G.: Sustainability and digitization go hand in hand. It’s not a secret that the maritime industry is among one of the more conservative, in some cases still relying on physical paper to facilitate trade. We need to digitize many processes in the maritime trade and supply chain eco-system, while continuing to explore the gains possible from shared intelligence, data aggregation and AI. This to enable resilience, improve efficiency and reduce the emission footprint, simultaneous with the efforts being undertaken to decarbonize freight.
S4S: What actions should we take to collectively create an inclusive and attractive industry for the future generation?
M.V.G.: We have a unique opportunity to make the impossible possible by leveraging the power of collective action. The role of shipping is essential in the global trading system with some states and islands being served primarily by sea and approximately 90% of all traded goods moving via our oceans. We have an obligation to future generations to ensure that the maritime ecosystem serves us all in a sustainable and resilient manner.
S4S: If you could change one thing in the maritime industry from your perspective what would it be and why?
M.V.G.: Risk-taking, fast followers. I am astonished to see how frontrunners are driving change. We need much more of this bold, brave action from many more companies and countries.
S4S: What is your key message to industry stakeholders with regards to the maritime industry? What is your advice to remain competitive amid these challenging times?
M.V.G.: There is strong agreement about the urgency and the continuous need to push the envelope. Industry stakeholders need to keep this mindset as we move from removing barriers to executing and building vessels that can sail on zero-emission fuels and ports who can berth and refuel these zero-emission vessels. Transitions often present challenges, but challenges also present opportunities that can lead to great gains if nested in the right manner. We continue to strive for broad collective engagement and collaboration at the World Economic Forum, inviting a wide spectre of industry actors across geographies to the table to explore feasible pathways to a more inclusive, sustainable future.
The views presented hereabove are only those of the author and not necessarily reflect those of SAFETY4SEA and are for information sharing and discussion purposes only.
