Friday, 22 April 2016

In a globalised world the EU serves no useful purpose

If I can think of an industry that doesn't need any more headaches right now it's shipping. There is massive oversupply in the market, rates are collapsing and there's the problem of the economics of Triple E ships. Once thought of as the answer to global shipping efficiency, now viewed as white elephants. Like the Airbus A380, some are making too many trips with empty slots. The view is that the industry needs to be serving more destinations with smaller ships.

What it doesn't need is virtue signalling politicians imposing their climate obligations on it. Not if it wants to see growth this side of 2020. Certainly for a global industry like shipping, the last thing you want is several sets of regulations to comply with, hence the international opposition to regional regulatory frameworks.

The International Maritime Orgainisaton (IMO)’s marine environment protection committee (MEPC), which deals with air pollution and CO2 emissions from shipping, has become more vocal especially after the adoption of the first EU regulation addressing shipping CO2 emissions.

Monitoring and reporting of the emissions (MRV) at EU level, however, is just a first step – falling well short of actually requiring ships to do something about reducing their emissions from one of the few sectors exempt from the EU climate target. But you know where this is going.

This regulation, which came into force across the EU in July 2015, was nevertheless more than enough to cause an outburst of protest from the IMO secretary general and at the opening of the May 2015 IMO MEPC. In the presence of the delegation of the European Parliament, attending an IMO meeting for the first time, it was emphatically stated that the preference of the industry and the IMO was for international measures. That's not going to stop the EU.

And this is really why the EU is a menace. We have multilateralism for a reason. To create global standards. Rightly the IMO is telling the EU to get lost (and not for the first time, but this is vital news for two reasons.

Firstly it's an example of where the EU doesn't actually have clout despite the many protestations that it does, and secondly, we see the EU making an attempt to replace member states on global bodies. It is only a matter of time before the EU observer status becomes an official seat.

To me this clearly demonstrates that not only is the EU not the top table of international affairs, its own conduct shows that it is not on the least bit a collaborative institution and that our influence is considerably diminished by remaining in it. Far from advancing our interests or looking to wield greater influence in the common good, the EU cannot break out of its own myopic fixations. Its activity is more about asserting itself as an entity rather than doing something useful.

What is particularly interesting though, is that there is general agreement that the EU does not perform a useful role at global level. British representatives of the maritime industry thought that the Commission's representation at the IMO actually interfered with the UK's ability to act effectively.

Not least of the problems was the EU's tendency to "Europeanise" global standards by adding its own requirements. As a global industry, they felt, shipping should be regulated at the global level, without sub-regional add-ons. As such, the UK Chamber of Shipping feels there is no advantage in the EU having a greater say in IMO under the present circumstances or in the foreseeable future.

Another interested party, Lloyd's Register, explains why the EU performs so badly. Its problem is that it is not a "flag". This means that the Commission does not have international treaty obligations to treaty parties in the maritime world. The UK is a "flag" and does have international treaty obligations.

As a result, while the European Commission may take decisions "for the good of the Union", the practical consequences fall on the flag states. Those states, rather than the Union, should make the decisions.

But there are other problems arising from the EU's semi-detached status. It attempts to forge common positions in IMO negotiations are often counter-productive, making it harder to achieve desirable outcomes. It looks after its own interests while individual Member States try to work with a broader range of IMO member nations towards agreed and workable international rules.

And this is why the EU is the precise opposite of cooperation and internationalism. The empty rhetoric we hear from europhiles just does not match reality and when it meddles on our behalf it has very real consequences and costs for industry and has a serious impact on jobs.

This industry sector suggests that there are occasions when the UK is better off in the international arena as an independent player. As much as we need to be robust in maintaining an independent position, we should also seek to restrain EU influence on such bodies, unless it is tactically appropriate to allow it to play a part. That cannot happen while we are an EU member and in future as the Eurozone EU becomes the dominant voice, we are set to lose ever more influence within.

In the post-Brexit world, however, we are free to forge ad hoc alliances with other players. As we have argued, Brexit does not mean an end to cooperation with the EU either. It just gives us the freedom to choose - which is not exactly too much to ask.

Whatever your view on the necessity for climate targets, that agenda cannot interfere with the normal business of shipping at this point. Kicking a key industry when it is down, on the brink of a global slowdown really is economic suicide.

And this is yet another reason to leave the EU. At top level climate talks among the politicians, there is a herd mentality where there is a bidding war to prove each others right-on credentials. And while they stroll the red carpets, shaking hands and congratulating each other they remain entirely ignorant of the practical, technical and moral consequences of what they do. Every time they tinker they make food and consumer goods more expensive - but it's not them who end up paying the price.

This above all is why the global consensus and domestic governance needs a major shake up and a kick out of its complacency, and from where I'm standing, Brexit is just what the doctor ordered. You can see why they oppose it can't you?

No comments:

Post a Comment