New UCL research reveals a complex mix of opportunity and risk to key maritime nations under various IMO outcomes

LONDON: A new report from the UCL Shipping and Oceans Research Group finds that no major maritime nation is fully prepared for the tightening decarbonisation rules being negotiated at the International Maritime Organization (IMO). The study — the first systematic comparative assessment of national policy posture across ten major shipping nations — warns that some of the world’s most technically capable maritime nations, including high income economies, face an “incumbent paradox”: their current asset base, in combination with their national policy’s misalignment with the IMO’s Revised Strategy, creates risks that may weaken and/or forestall their incumbency. Equally, some countries, such as India, with lower existing lock in and stronger latent industrial potential are better positioned to take advantage of clear/strong GHG policy at the IMO and disadvantaged by fragmented regional policy.

Dr Pinar Langer, Research Fellow at the UCL Energy Institute Shipping and Oceans Research Group, said: “This report shows that countries are not starting from the same place in the shipping transition, and that readiness depends on more than headline ambition alone. What matters most is whether policy signals, investment priorities and transition planning are aligned in ways that support scalable zero-emission pathways and reduce risk of long-term lock-in”

The report assesses national alignment with the IMO’s 2023 GHG Strategy across three domains — greenhouse gas targets and long-term planning; fuel pathway signals; and shipbuilding transition support for ten major shipping nations. Countries fall into four distinct policy-posture archetypes:

• Aspiring Leaders (USA, China, UK): Strong green-fuel readiness and comparatively lower LNG lock-in exposure, better position them to benefit  under a comprehensive global deal.
• Hedged Incumbents (Singapore, South Korea, Japan, EU): Highly capable, but maximum LNG exposure creates acute vulnerability if well-to-wake standards and carbon pricing tighten.
• Developing Industrialists (India): High industrial transition potential and zero LNG legacy risk — a potential “leapfrog” economy if international finance mechanisms close the investment gap.
• Policy Takers: (UAE, Malaysia): High LNG exposure and weaker domestic transition signals; face conflicting compliance demands and imported transition costs under divergent regional regimes.

The United States is treated as a volatile case in the report. Under Biden-era policies the US would sit close to the “Aspiring Leader” profile, but the current administration’s opposition to core elements of the IMO Net-Zero Framework means any fixed classification would be time-bound.

The report draws three overarching policy implications for governments seeking to implement the IMO 2023 Strategy. First, managing transitional fuel lock-in is as important as setting long-term targets: LNG-specific infrastructure creates asymmetric downside risk under stringent regulatory designs, making early planning for orderly pivot pathways and lifecycle (well-to-wake) performance increasingly urgent. Second, credible IMO fund, reward and finance mechanisms are not optional — they are central to both formation of a broad majority of support for a policy design at the IMO, and to activating high-potential countries such as India without imposing unfunded compliance burdens. Third, governance coherence reduces system-wide transition costs, while prolonged fragmentation amplifies compliance complexity and deepens technology-taker dependence for countries with weaker industrial transition capacity.

The report also highlights the risk of “pseudo-action” under a partial NZF deal scenario: a standards-only NZF outcome may temporarily validate LNG-heavy strategies while weakening the investment case for genuinely zero-emission fuels, raising long-run adjustment costs across the sector.

Prof. Tristan Smith, Professor of Energy and Transport at UCL Shipping and Oceans Research Group, said: “It is clear from this analysis that although IMO’s Revised Strategy was unanimously adopted, countries are at different points in their journey to convert that outcome into national policy. It’s also clear that maritime nations face risks from their incumbency, which are not always best served by a weak outcome in how IMO’s Net Zero Framework now advances. There is significant complexity in how competing pressures might play out both within IMO’s member countries and between countries.”

The report draws on a systematic documentary review of official maritime strategies and decarbonisation policies for ten countries. National signals are coded against a common indicator rubric and aggregated into four composite dimensions: Target Commitment & Alignment (TCA), Green Fuel Readiness (GFR), Transitional Fuel Risk (TFR), and Industrial Reorientation (IR). Countries are then grouped into policy-posture archetypes and assessed through a structured scenario stress test across three regulatory futures. Full methodology and indicator definitions are available in the report annex.

Dr Will McDowall, Associate Professor at the UCL Institute for Sustainable Resources said “The long-term direction of travel towards clean shipping is inevitable as the pressures of climate change mount. Our analysis highlights the risks for countries that are not aligning their policies with that long-term reality”

The report follows on from a report released last week, which showed LNG and methanol create path dependencies that divert investments from shipping’s long-term decarbonisation pathway. Whilst they generate some knowledge spillovers and procedural regulatory learning useful for scalable zero emission fuels, these benefits are likely outweighed by capital lock-in and the entrenchment of fossil fuel infrastructure, which then compete with, rather than enable the long-term solution.

About UCL Energy Institute

The UCL Energy Institute hosts a world leading research group which aims to accelerate the transition to an equitable and sustainable energy and trade system within the context of the ocean. The research group’s multi-disciplinary work on the shipping and ocean system leverages advanced data analytics, cutting-edge modelling, and rigorous research methods, providing crucial insights for decision-makers in both policy and industry. The group focuses on three core areas: analysing big data to understand drivers of historical emissions and wider environmental impacts, developing models and frameworks to explore energy and trade transition to a zero emissions future, and conducting social science research to examine the policy and commercial structures that enable the decarbonisation of the shipping sector. For more information visit www.shippingandoceans.com