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The International Chamber of Shipping (ICS) - the principal international trade association for shipowners, representing all sectors and trades and nearly 80 percent of the world merchant fleet - has given a 'cautious welcome' to recommendations applicable to international maritime transport made by the United Nations High Level Advisory Group on Climate Change Financing (AGF).

The AGF report has been published in advance of the next United Nations Climate Change Conference (COP 16) which will meet in Mexico in December.

“We are pleased that the report acknowledges the complexities of bringing shipping into any funding mechanism that might be developed by the UNFCCC.” said ICS Secretary General, Peter Hinchliffe.

"Most importantly, the UN report recognises that the UNFCCC principle of common but differentiated responsibility must be reconciled with the need for any market based emission reduction measures adopted to apply equally to all ships globally," the ICS said in a statement.

“It is very positive that the report recognises that the most appropriate forum for reconciling these objectives will be the International Maritime Organization” said Hinchliffe.

“Any system of financing that only applied to ships registered in richer nations would result in gross market distortions and the hemorrhaging of vast amounts of tonnage from OECD countries to the flags of those nations not affected,” added Hinchliffe.

In a submission to the UN Advisory Group, made in September, the ICS argued that delivery of significant emissions reduction by the international maritime transport sector would require that any measures adopted are applied on a uniform and global basis in order to avoid ‘carbon leakage’.

The ICS explained that only about 35 percent of the world fleet is registered with richer Kyoto Protocol ‘Annex I’ nations, and that most shipping companies have the freedom to decide to register their ships with the nations of their choice, including ‘non-Annex I’ countries.

"Encouragingly, the report appears to recognise that measures to deliver meaningful global emission reductions by maritime transport will be far more likely to be achieved if adopted by governments at IMO, so that they can be applied to the entire world fleet on a global basis," the ICS said.

Hinchliffe added: "The report does contain a number of points relevant to shipping about which ICS has questions, such as the suggestion that not all of the money that might be raised through market based measures would be used to support environmental projects. However, ICS believes it should be possible to address these points through proper debate at IMO.’

"There is widespread consensus amongst the international shipping industry - as well as the majority of the world’s transport ministries - that the most effective means of reducing carbon dioxide emissions from ships will be for the UN Climate Change Conference in Cancun, in December 2010, to give IMO a clear mandate to finalise and implement the comprehensive package of technical and economic measures which has already been developed by its Marine Environment Protection Committee which last met in September, and meets again next summer," the ICS said.

"ICS will be reiterating these points at the UNFCCC Conference in Mexico where it will be representing the views of the global shipping industry," the ICS added.