ENVIRONMENTAL PROTECTION IN SHIPBUILDING

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Korea's shipbuilders topped the world rankings last year in terms of orders for eco-friendly ships, recording the highest performance in eight years. This comes despite a year of economic difficulties. Environmental protection is now becoming a leading trend in the shipbuilding sector as well.

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Container ships crossing vast oceans are mostly powered by cheap bunker fuel. A single container ship emits air pollutants on par with 50 million diesel cars.

[Soundbite] Kwon Hye-jin(Ministry of Trade, Industry and Energy) : "As of 2018, global carbon emissions produced by ships reached 911 mn tons. That's about 2.5% of total carbon emissions worldwide."

By 2050, the International Maritime Organization aims to reduce CO2 emissions from ships worldwide by 70 percent. A rating system is to be introduced next year. Ships that fail to meet the requirements will be expelled from the market. About 80 percent of vessels are at risk of being ousted. This is because demand for eco-friendly ships is rising as part of efforts to achieve carbon neutrality.

[Soundbite] (Korea Shipbuilding and Offshore Engineering official) : "As global environmental standards are becoming stricter, interest in eco-friendly ships has resulted in more orders for us since last year."

Korean shipbuilders are seeing their popularity grow as LNG vessels, an icon of eco-friendly ships, are drawing the global spotlight recently. More than 60 percent of orders for eco-friendly ships in 2021 were obtained by Korean shipbuilders, which hold the largest share in the global market. But many are warning against complacency. LNG is also a fossil fuel. It emits a lot of carbon dioxide and is prone to severe price fluctuations.

[Soundbite] Hong Sung-in(Korea Institute for Industrial Economics & Trade) : "Everyone knows that LNG will soon be replaced by other kind of fuel. We have to step up R&D to stay ahead of China or Japan."

Next-generation fuel such as ammonia, hydrogen and methanol have distinct advantages and disadvantages. There are no clear alternatives yet. Experts say maritime carbon neutrality could present Korean shipbuilders not only with opportunities but also with challenges.