12 March 2012

Norway caught in ship recycling dilemma:

The country will certainly ratify the Hong Kong Convention but is also doing its bit to help Bangladesh.

Norwegian shipowners are open about the fact that they have a vested interest in seeing ship scrapping continue in a country like Bangladesh.

They need locations in the Indian subcontinent to recycle endof-life tonnage just as much as the Bangladeshis need the reclaimed steel plate to feed the country’s mills.

Last November, a memorandum of understanding (MoU) was signed between the Norwegian government and the Bangladesh Ministry of Industries to move forward a project aimed at raising recycling standards at Chittagong.

Behind the scheme is the Norwegian Agency for Development Co-operation (Norad), which is working with the Bangladesh government and has requested the International Maritime Organisation (IMO) to manage the project.

Acceptable health, safety and environmental standards in line with national and international norms is the objective, although progress has been slow and the focus on training rather than infrastructure has attracted plenty of criticism (see story, right).

Funding is expected to be $5m to $6m over a period of three to four years but is restricted to socalled “capacity building” or helping create expertise.

IMO ship-recycling chief Nikos Mikelis told TradeWinds: “With other funding we hope to secure, we will start dealing with the actual hardware.”

Initial talks have been held with shipowners’ associations, although the Bangladesh Ship Breakers’ Association (BSBA) will also be expected to contribute.

Tor Christian Sletner, head of section in the Department of Safety, Environment and Innovation at the Norwegian Shipowners’ Association (NSA), says member companies are already advised to demolish their ships in China because of higher safety and environmental standards.

But the fact remains that numerous Norwegian-controlled vessels each year end up on Indian subcontinent beaches.

Not surprisingly, it has attracted the attention of the NGO Shipbreaking Platform, which recently dubbed Norway as Europe’s second-biggest dumper of toxic tonnage in South Asia with 24 vessels in 2011, the biggest being Greece with 100 vessels.

More than 200 European vessels were sent to beaches in South Asia last year, says the Brusselsbased non-governmental organisation (NGO).

Sletner says Norway does not feel guilty about the NGO report.

It has a huge commercial fleet. At governmental and NSA level it behaves responsibly and this is behind its support for improvements in Bangladesh.

Norway has for the past 10 years played a leading role in formulating the Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships (HKC) and “we very much look forward to it being ratified and coming into force”, says Sletner.

It is hoped that Norway will ratify the HKC this year. Legislative paperwork is already said to be in the parliamentary system.

Environment minister Erik Solheim is said to be commited to its introduction.

Sletner acknowledges the slow pace at which the Norad project in Bangladesh has moved but blames this partly on cultural differences.

The key is motivating yards, including the BSBA, to adopt better standards, he says.

The Norwegian Ministry of Environment is understood to be close to appointing a project leader.

Sletner says the NSA already stresses to its members the importance of compiling inventories of hazardous materials (IHMs), as required by the HKC, prior to selling vessels for demolition.

Although Norad’s focus is not on infrastructure, it is providing money for training and safety equipment. A major training challenge is the fact that so many workers are illiterate.

Sletner claims there are already signs of progress in Bangladesh such as a register of workers, whereas previously labourers simply congregated outside the yards in the hope of getting a job.

Meanwhile, he says Norway will monitor possible entry into the recycling market of other countries such as the Philippines and Vietnam.

“The world needs these services and we all gain from a healthy industry,” said Sletner.

Japan is also involved in a joint project with the state government of Gujarat to invest $22.5m on upgrading facilities at Alang in India.

Several leading Japanese shipowners joined a delegation visiting India last month, including NYK Line, Mitsui OSK Lines (MOL) and K Line.

Source: TradeWinds Business Report. By Geoff Garfield. 9 March 2012

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