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Business Ethics

Hapag-Lloyd alters scrapping policy, citing ethics

German shipping company Hapag-Lloyd has changed its policy on the sale of old vessels. Its "old ladies" will now be sent to specialized docks for scrapping instead of trading them in the global marketplace.

Hapag-Lloyd said Monday it would no longer sell phased-out cargo vessels on global markets where the company once enjoyed high returns on older freighters still in good condition.

The decision goes against an emerging trend in the industry of sending old ships to scrapping docks in India, Bangladesh or Pakistan in order to make a quick buck on the price of scrap metal.

But the company told Germany's dpa news agency that it had ethical qualms about laborers in those countries facing adverse working conditions.

Many are not at all protected against the tons of poisonous materials, such as asbestos and the chemical PCB, commonly found in large ships.

Applause from campaigners

One organization that has led the campaign against dangerous pollution and unsafe conditions that result from end-of-life ships with toxic-laden structures being freely traded in the marketplace is the Shipbreaking Platform, a non-governmental coalition of environmental, human rights and labor representatives.

"We explicitly welcome Hapag-Lloyd's move and hope that other ship owners will follow suit," the platform's chief, Patrizia Heidegger, said in a statement.

Last year alone, 655 big vessels were scrapped in India, Bangladesh and Pakistan, where a single ton of scrap metal could fetch up to $470 (351 euros).

Rampant child labor in the docks and frequent lethal work accidents, however, have blighted the business.

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