Ship Finance: Crucial for the Growth and Energy Transition of Shipping

Shipping needs access to sufficient finance for the growth and renewal of the fleet and, as a hard-to-abate sector, to facilitate its decarbonisation. The EU framework on ship financing should be conducive to serving this goal and ensuring the competitiveness of EU shipping.

The EU Taxonomy framework, which aims to direct private investments towards sustainable activities, recognises that shipping can contribute to the transition to a climate- neutral economy. However, the specific conditions and criteria implemented are not fit for purpose for the sector and need to be reviewed, by removing primarily any cargo- related restrictions on the financing of vessels.

In banking finance, the EU prudential rules for banks are currently very restrictive, without taking into account the specific features and the financial risk profile of ship financing. It is, therefore, essential to promote those institutional measures at the EU level that will ultimately reverse the downward trend in ship financing.

Τhe proliferation of regional or private initiatives concerning ship finance, which do not take into account the nature and special features of the shipping industry, create a patchwork of distinct frameworks and undermine the global level playing field.