IF the local maritime industry fails to adjust to the changing global landscape, jobs could be lost and products could become more expensive, according to economists.
Last week, in a BBC report, major firms Amazon, Ikea and Unilever pledged to support zero-carbon shipping by 2040. They intend to only ship goods through shipping lines that use zero-carbon fuel in two decades.
Former Dean of the University of the Philippines School of Economics Ramon L. Clarete said changes that could lead to greater trade costs could impact jobs, such as those of seafarers, and the cost of goods.
“Seafarers are employees of international shipping companies. The latter will have to adjust. If they can, seafarers would have to retrain themselves based on how shipping firms adjust,” Clarete told this newspaper.
“Those [shipping companies] who can’t [adjust] will exit and some of our seafarers would lose jobs. Whatever raises the cost of trade, [raises the cost of] goods,” he added.
At this point, however, Clarete said there is no known alternative to fossil fuel for ships. While Liquefied Petroleum Gas (LNG) is an alternative to fossil fuels, it will not lead to zero carbon footprint.
Former Ateneo Center for Economic Research and Development (Acerd) Director Alvin P. Ang told BusinessMirror that given the uncertainties surrounding the situation, providing recommendations would require further study of the possible impacts, especially when it comes to the jobs of seafarers.
Ang said regardless of who wins in the next elections, the government must determine the impact of the decision of these major firms on the shipping industry and prepare.
He said the national government must adopt a “two steps a[head] mindset” when it comes to this matter. It is fortunate, however, that there is still time to study the implications and prepare.
Adjust or perish
“The adjustment…especially for the maritime private sector will of course entail huge investments. But do we really have a choice?” Action for Economic Reforms Coordinator Filomeno Sta. Ana III told BusinessMirror.
“Technology is the driver of sustainability and growth. The private sector, enabled by government directives and nudges, really has no option but to comply, lest it be left behind,” he said.
Sta. Ana said these along with other climate change-related issues should also concern the Philippines, including the local maritime industry.
He said the Department of Trade and Industry (DTI) “is acutely aware of the problem” and that its priority plan already gives serious attention to green technology.
Nonetheless, the bigger intervention that is needed is on fossil fuels, given the amount of investments this will require in order for the country to help eliminate the use of this source of energy.
Clarete noted that renewable energy sources could drive down the country’s competitiveness. This should prompt the Philippines to start thinking of ways to adjust given the calls for zero carbon.
He said one way for the country to adjust to this is to forge partnerships with countries when it comes to the use of energy sources.
“We can forge partnerships with countries like us for special and differential treatment. Like they give us 20 more years to meet the standard,” Clarete said. “We can do that and at the same time invest to build more hydros and geothermal plants.”
Last week, the International Renewable Energy Agency (IRENA) in collaboration with the International Labour Organization (ILO) reported that renewable energy employment worldwide reached 12 million last year, up from 11.5 million in 2019, according to the eighth edition of Renewable Energy and Jobs: Annual Review 2021.
The report confirmed that Covid-19 caused delays and supply chain disruptions, with impacts on jobs varying by country and end use, and among segments of the value chain.
While solar and wind jobs continued leading global employment growth in the renewable energy sector, accounting for a total of 4 million and 1.25 million jobs respectively, liquid biofuels employment decreased as demand for transport fuels fell. Off-grid solar lighting sales suffered, but companies were able to limit job losses.
China commanded a 39-percent share of renewable energy jobs worldwide in 2020, followed by Brazil, India, the United States, and members of the European Union. Many other countries are also creating jobs in renewables.
Among them are Vietnam and Malaysia, key solar PV exporters; Indonesia and Colombia, with large agricultural supply chains for biofuels; and Mexico and the Russian Federation, where wind power is growing. In Sub-Saharan Africa, solar jobs are expanding in diverse countries like Nigeria, Togo, and South Africa.