IMO net-zero showdown puts Greece and Cyprus shipping decisions on the line

The International Maritime Organisation (IMO) is heading towards a decisive December showdown over its Net-Zero Framework, with Greek and Cyprus shipping voices warning that the final rules must work in the real world of global fuel supply, ship investment and international competition. After four days of negotiations in London last week failed to close several of the remaining gaps, governments now have less than three months before another intense round of talks that could determine the shape of global shipping regulation for decades. The next round, ISWG-GHG 23, will take place from November 23 to 27, immediately followed by the Marine Environment Protection Committee’s MEPC 85 session from November 30 to December 3. Then, subject to confirmation by MEPC 85, the extraordinary session suspended in October 2025 is scheduled to reconvene on December 4, when governments could again attempt formally to adopt the framework. The question is no longer simply whether international shipping should decarbonise. The argument increasingly concerns how quickly, at what cost and with which fuels a global fleet operating across thousands of ports can realistically make that transition. The IMO Net-Zero Framework, approved in draft form in April 2025 but still awaiting formal adoption, would combine a global marine fuel standard with an emissions pricing mechanism. Ships would progressively have to reduce the greenhouse gas intensity of the energy they use, while vessels failing to meet the required thresholds would face additional compliance costs. At the same time, money raised through the system would flow into an IMO Net-Zero Fund intended to support zero and near-zero emission fuels, innovation and the wider transition. However, agreement over how that system should operate remains elusive. For the Union of Greek Shipowners, one of the central problems is whether the framework reflects the commercial conditions under which shipowners actually operate. The Union president Melina Travlos has made clear that Greek shipping supports decarbonisation and a single global solution through the IMO, while arguing that the existing framework still contains important weaknesses. The Greek side has looked more favourably at the approach put forward by Panama and Liberia, viewing it as a possible basis for further negotiations. That approach places greater emphasis on the availability, affordability and scalability of alternative fuels, as well as the contribution of ship energy efficiency while new fuels remain scarce or expensive. Behind that position lies one of shipping’s most difficult investment questions. A vessel ordered today could remain in service for 20 years or considerably longer. Owners are therefore being asked to decide now whether to invest in conventional engines, dual-fuel systems, LNG, methanol, ammonia or other technologies without knowing with certainty which fuels will be widely available during the life of the ship, where they will be available and what they will cost. For Greek shipping, the sums involved are enormous. The Greek-owned fleet numbers around 5,800 ships, representing about 19 per cent of global deadweight capacity, while Greek owners currently have 725 vessels on order, representing an investment estimated at around $60 billion. Much of the Greek fleet also operates in bulk and tramp shipping rather than on fixed liner routes. That matters because a vessel repeatedly sailing between the same ports may be able to arrange its future bunkering around established alternative-fuel infrastructure. A tanker or bulk carrier whose next employment may take it to a completely different part of the world faces a considerably harder calculation. However, these concerns are far from Greek alone. For Cyprus, the December negotiations also carry substantial commercial weight. The island has the third-largest merchant fleet in Europe and the 11th largest globally, while companies operating from Cyprus manage more than 20 per cent of the world’s third-party managed fleet, according to the Shipping Deputy Ministry. Limassol alone hosts more than 200 shipping and shipping-related companies, including shipowners, shipmanagers, insurers, financiers, brokers and maritime technology businesses. What the IMO eventually decides will therefore affect not only Cyprus-flagged vessels but also a much larger international fleet whose technical, operational and commercial decisions are taken from Cyprus. The Cyprus position has similarly placed considerable emphasis on realism and global rules. Earlier this year, Shipping Deputy Minister Marina Hadjimanolis called for policymakers to listen meaningfully to the shipping industry, arguing during discussions on maritime decarbonisation that regulation can move ahead before there is sufficient understanding of how the sector actually operates. The Cyprus Shipping Chamber (CSC) has taken a comparable line. Following MEPC 84 earlier this year, the chamber called for a framework that is “practical, effective and globally applicable”, while stressing the need for a solution capable of maintaining a level playing field for international shipping. Its position is important because Cyprus has consistently supported decarbonisation through the IMO rather than a patchwork of competing regional systems. As the chamber has previously argued, shipping is inherently global, meaning a proliferation of different regional carbon rules risks increasing costs and placing ships trading on particular routes at a competitive disadvantage. Cyprus and Greece also found themselves on the same side of one of the most difficult moments in the negotiations last year. Both countries abstained in October 2025 when the IMO process ended with the extraordinary MEPC session being adjourned rather than the framework being formally adopted. Cyprus subsequently explained that its aim was to allow more room for a broader agreement around a framework that could be both ambitious and workable. The December negotiations will show whether that wider agreement can now be found. One of the biggest remaining battles concerns money. At the heart of the framework is the proposed emissions pricing mechanism and the IMO Net-Zero Fund, which could eventually collect billions of dollars from shipping. Those revenues are intended to help accelerate the uptake of zero and near-zero emission fuels and technologies, while also supporting developing economies facing greater difficulty financing the transition. However, member states continue to disagree over how the money should be raised, where it should go and how strongly the mechanism should reward ships switching early to cleaner fuels. Analysis of the September negotiations by University College London’s Shipping and Oceans Research Group found that a substantial majority of countries speaking during the meeting continued to support some form of centralised revenue mechanism. That, however, is still some distance from agreement on its design. Moreover, the September meeting ended before several important technical questions could be properly examined. The IMO working group managed only a preliminary discussion of the guidelines needed to implement the framework uniformly, with the remaining documents transferred to ISWG-GHG 23 in November. Work on the IMO’s Life Cycle GHG Assessment framework was also pushed forward because of time constraints. That methodology is particularly important because marine fuels will be judged on a well-to-wake basis. In other words, the calculation will not stop at emissions produced when fuel is burned aboard a ship. Emissions generated during the production, processing and transportation of that fuel will also matter, potentially changing the economic case for fuels that appear considerably cleaner when only exhaust emissions are considered. For shipowners in Greece, Cyprus and elsewhere, such details can materially alter investment decisions. A fuel or engine technology that appears commercially attractive under one regulatory methodology could become much less competitive under another. That is why December has become much more than another round of environmental negotiations. IMO member states must still reconcile disagreements over carbon pricing, the distribution of revenues, alternative-fuel incentives, life-cycle emissions and the practical rules governing compliance. At the same time, shipowners are already ordering vessels that will remain at sea well into the 2040s. For Cyprus, one of the world’s leading shipmanagement centres, and Greece, home to the world’s largest shipowning community, the outcome will therefore reach directly into newbuilding orders, engine choices, fuel strategies and operating costs. Both shipping centres support the destination. The real battle now is over whether the IMO can agree on a route that the global fleet can actually follow.