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Confusion over scrapping policy

Confusion over scrapping policy
The European Union?s policy on aid to beleaguered shipbuilders was thrown into confusion today after a top official denied the European Commission was working on incentives to scrap old ships.

The European Union"s policy on aid to beleaguered shipbuilders was thrown into confusion today after a top official denied the European Commission was working on incentives to scrap old ships.

The European Union"s policy on aid to beleaguered shipbuilders was thrown into confusion today after a top official denied the European Commission was working on incentives to scrap old ships.

A senior official from the commission"s directorate-general for transport said there were ?no plans? to allow state subsidies for owners wishing to replace aging tonnage with new ships built in European yards, contrary to reports by an European Union commissioner.

?There is nothing on the table, no plans,? he told Lloyd"s List. ?If we went down that route there would just be flagging out.?

The official, who preferred not to be quoted by name, said he was ?surprised? to see comments by maritime affairs commissioner Joe Borg suggesting the opposite.

The commission earlier this month distributed a speech given by Mr Borg in the Azores in which he talked of ?broadening our state aid guidelines to allow support for building ships which implement higher environmental standards.?

The commissioner added: ?We could also have scrapping measures centred on shortsea shipping vessels which are often relatively old, high emission ships.?

The comments also surprised industry. While EU shipbuilders and a number of shipowners have indeed been calling for such a scrapping scheme, there was until this point no indication Brussels would take the lead.

Owners are split on scrapping

Owners are split on scrapping, with some arguing an EU-backed scheme would be unworkable because ships" flags and the nationality of the shipowner are often not the same.

?I think what has happened is that Mr Borg has been talking to our friends in Italy,? said the commission source, referring to Corrado Antonini, honorary chairman of the Community of European Shipyards" Associations, and Emanuele Grimaldi, head of shortsea operator Grimaldi Naples, both supporters of an EU scrap-and-build scheme.

DG Tren and Mr Borg"s DG Mare have not been on the best of terms over the current commission mandate. DG Tren is in charge of maritime transport policy though the renamed maritime affairs directorate-general, which previously was confined to fisheries policy, would like to get in on the act. DG Mare is heading a so-called ?holistic? review of all policy related to the sea.

EU shipbuilders have called on the commission to help find solutions for their bare orderbooks, which will threaten viability if not replenished in the short term.

A collapse in world trade has combined with past over-ordering to reduce European orders by 90% in tonnage terms while accelerating the transfer of the newbuilding industry towards Asia.

Earlier this month, Brussels transport commissioner Antonio Tajani attended a ?crisis? summit, after which the commission issued a statement saying it was looking at ?short-term support measures which should help the sector to emerge strengthened from the current crisis?.

As examples of such measures the commission mentioned ?loan guarantees for risk-mitigating measures? and ?promoting environmentally-performing vessels?, though there was no specific mention of scrapping or newbuildings. It was, however, announced that Brussels industry commissioner Günter Verheugen would meet member states and industry ?to discuss strategic shipbuilding matters? in Germany in September.

www.TurkishMaritime.com.tr

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