EU safety rules for recycling yards could save hundreds from injury and poisoning but pose dangers for south Asian economies
“Every bit of this ship will be recycled, reused and resold. Nothing will go to waste. This ship will help build Bangladesh. We dismantle 2.5m tonnes of steel a year from Chittagong, but we need four million tonnes to keep growing,” says Hefazatur Rahman, chairman of the Mostafa group of industries, which paid $20m to buy the Lara 1 for scrap, and could make $10m profit if world steel prices rise in the next year. Or, he says, he could lose everything if they fall, as they did in 2008.
But now, in a move that India, Bangladesh and other developing countries with major shipbreaking industries say could wreck local economies, the EU has proposed laws stating that ships registered in Europe should be broken up only in licensed yards meeting strict new environmental guidelines.
The profit margin on breaking ships is thin and highly speculative. EU regulations on how ship-breaking should be done will merely raise the price of doing business and ensure that nobody recycles ships.
Well, it’s certainly one way to get all ship owners to avoid European registrations. At the very least, as ships approach retirement, their owners will almost certainly “re-flag” them in some third world country which has a government that still understands commerce. Ultimately, this is not far different than the regulations that the U.S. implemented which resulted in almost no U.S. flagged ships anywhere in the world.