The road to a green future is long and arduous. However, the European Union (EU) is determined to become the world’s carbon-neutral continent by 2050 and transform the maritime sector in line with this goal. After incorporating the maritime sector into the Emissions Trading System (ETS) from next year, the EU is also working on FuelEU Maritime, an environmentally friendly fuel regulation for shipping.
Both mechanisms will affect all countries whose shipping companies operate in Europe. One of these countries is Türkiye, the sixth-largest trade partner of the EU. The EU is by far Türkiye’s largest merchandise import and export partner: in 2022, 26% of Türkiye’s goods imports came from the EU and 41% of the country’s goods exports went to the EU.
Considering the export volume and the fact that the Turkish maritime industry makes up one of the most significant industrial contributions to carbon emissions in Turkish transport, the importance of green transformation becomes clearer.
The sector representatives in Türkiye carefully follow the developments in the EU, and the number of carbon-neutral maritime businesses in the country is increasing. Adaptation projects for green transformation have already started to be carried out in Türkiye. All these developments show that Türkiye, which announced a net zero emission target in the maritime sector by 2053, together with 44 countries at the International Maritime Organization (IMO) meeting in March 2023, is progressing towards green shipping. This July, IMO is expected to adopt a revised greenhouse gas emissions strategy.
“Shipowners invest heavily in new-build ships that run on environmentally friendly alternative fuels. The ports of our country are turning into Green Harbor. In addition to the ships to be scrapped, grants and incentives are given to new-build ships,” says Yusuf Öztürk, Chamber of Shipping Izmir Branch Chairperson.
However, the sector representatives say the process needs to proceed faster. Assoc. Prof Dr Sabri Öz, Istanbul Commerce University International Logistics and Transportation Department, adds that “various efforts focusing on social, economic and environmental sustainability should be carried out with the cooperation of academia, public and industry, with the support of NGOs and the media.”
Cihan Ergenç, Chairman of the Board of the Turkish Shipowners’ Association, suggests investing in wind and solar for renewable fuel to be used in the maritime sector in Türkiye with government incentives. Yusuf Öztürk suggests that more support should be given to investments to transform the sector.
EU-Türkiye cooperation will speed up technological transformation
Giving ear to the sector representatives, this June, the EU and the European Bank for Reconstruction and Development (EBRD, the EU and its Member States together own 54% of its capital) have launched a joint financial programme focusing on decarbonising the maritime sector in Türkiye.
The Maritime Decarbonisation and Green Shipping Programme for Türkiye will facilitate green investments to accelerate the country’s shift towards a low-carbon economy, supporting both private and municipal sector investments.
The programme, prepared in consultation with the Ministry of Transport and Infrastructure, will focus on green investments that seek to modernise the sector while promoting environmentally friendly technologies in ports and vessels. Expected positive impacts include reductions in energy use, carbon emissions and waste, mitigating climate risks, and better air quality, especially in urban ports.
Dr Panayotis Zacharioudakis, the Managing Director of Ocean Finance, who contributed to the development of the Programme, states that the Turkish Maritime Industry has adopted an eco-friendlier approach in alignment with international and national regulation and legislation. According to him, “this ambitious task would be impossible in the absence of the EU-EBRD Maritime Decarbonisation and Green Shipping Programme for Türkiye.” The programme will blend EU grants and loans from the EBRD, securing the investment with top-notch technical assistance that will efficiently back up carefully selected projects catering for seaports and vessels, as well as alternative fuels infrastructures and marine applications.
On the occasion of the signing ceremony of the Programme in Ankara on 18th June, Ambassador Nikolaus Meyer Landrut, Head of EU Delegation to Türkiye, stated: “the EU-Türkiye cooperation will bring certain innovative technologies to Türkiye’s maritime sector and create a strong demonstration effect for the industry. By facilitating the pilot use of environmentally-friendly, frontier technologies and green fuels, the EU will be playing a critical role in breaking the existing barriers to the decarbonisation of Türkiye’s maritime sector. The European experience shows that without strong incentives, the barriers to use innovative technologies and use of alternative fuels cannot be overcome.”
Sue Barrett, EBRD’s Director for Infrastructure in Türkiye, Middle East and Africa, stated: “Change is continuous but never easy. As EBRD, we are pleased to be joining forces with the EU and Türkiye’s Ministry of Transport and Infrastructure at this significant stage, with a programme capable of generating sector-wide, transformational impact. We are confident that our funds, assistance and dialogue will work to align Türkiye’s maritime sector with the rapidly progressing international standards, securing the country a greener future.”
The €20 million donor funding from the EU will help leverage €50 million from the EBRD and potentially other co-financiers in the form of loan financing, with a 2.5x leverage effect.