The European Parliament’s Committee on Economic and Monetary Affairs adopted last week its position on the implementation of the latest Basel prudential requirements into EU law (Basel III). ECSA welcomes the outcome of the Committee’s vote, which recognises the need to safeguard the competitiveness of the European shipping industry by introducing an effective framework for fostering ship financing in Europe.
As advocated by ECSA, the Parliament has maintained the dedicated provision in the Commission’s proposal addressing ship financing under specialised lending. The Commission and the Parliament recognise the risk level associated with ship financing and have put on the table effective measures on capital requirements to ensure European banks have the tools to continue lending to European companies.
ECSA believes these provisions are crucial to keep European shipping companies on equal footing with other jurisdictions when it comes to ship financing, in particular for the many SMEs who are facing difficulties to seek alternative finance outside of Europe.
ECSA represents 20 national shipowners’ associations based in the EU and Norway. European shipowners control 39.5% of the global commercial fleet, contribute 149 billion euros per year to the EU GDP and provide 2 million people with careers both on board and ashore. ECSA strives for a regulatory environment that fosters the international competitiveness of European shipping, to the benefit of the EU.
“Shipping is a cornerstone of European security – we move energy, food, trade. It is crucial for European shipping to have access to competitive ship financing in the EU in order to maintain its competitiveness. We welcome the Parliament’s vote, as this is a first step to ensure we can allow banks to continue financing shipping, particularly at a time when the industry moves to deliver on its decarbonisation objectives. We hope that the Council will support a similar approach as the negotiations progress” said ECSA Secretary General Sotiris Raptis.
With increasingly stricter banking capital requirements and many European banks scaling down their ship finance activities, it is essential to look at which financing tools are best suited for the shipping industry. Europe’s financial landscape is heavily dependent on bank lending. European shipping and new investments can only remain competitive if regulatory and business conditions are in place for European banks to continue to finance shipping companies.
ECSA will continue to engage with the Commission, Parliament and Council as the final agreement is negotiated.
Source: ECSA European Community Shipowners’ Associations