NAVIGATING GREEN: THE IMPACT OF IMO’S ENVIRONMENTAL POLICIES ON GLOBAL SHIPPING AND THE SUEZ CANAL
Abstract
The maritime transport sector is crucial for the world economy, responsible for 85% of global trade volume, but only contributes 2.89% of global carbon emissions. The International Maritime Organization (IMO) has set an ambitious goal of near-zero emissions by 2050 and set short-, medium-, and long-term policies for promoting green shipping. However, these policies also pose challenges and economic burdens for the shipping sector. Medium-term policies will lead to an increase in shipping costs due to the carbon tax. The study examined the impact of IMO’s green policies on the global fleet, international trade, and the Suez Canal, which contributes to a strong reduction in emissions. The autoregressive distributed lag (ARDL) model showed a positive and significant short- and long-term effect of world seaborne trade on the Suez Canal trade. However, IMO’s policies showed no immediate significant impact in the short-term but negative long-term effects; however, the positive long-term effects of world seaborne trade were found to be greater than the negative long-term effects of IMO’s policies on Suez Canal trade.
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DOI: https://dx.doi.org/10.21622/MARLOG.2024.13.1.74
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