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Houthi group has been using drones and rockets on ships, which are transporting goods through the strait of Bab al-Mandab, which is a crucial shipping route connecting the Mediterranean Sea to the Indian Ocean
The disruption of Red Sea shipping routes is casting a long economic shadow over Africa underscoring the urgency to de-escalate the tension. Globally also, it is casting a lot of shadows on economic engagements among countries in various sectors. Manufacturing lines in some sectors like electronics, automobiles, chemicals, consumer goods, and machinery are being impacted severely. As a result of the long hauling of ships, freight charges are going up and so also supply constraints.
The Houthi group has been using drones and rockets on ships, which are transporting goods through the strait of Bab al-Mandab, which is a crucial shipping route connecting the Mediterranean Sea to the Indian Ocean. The US and Britain are jointly engaged in military operations to ward off the Houthis engaging in disruptions of ship movements. Some of the individual countries including from Europe, are also engaged in protecting their flags from the attack of Houthis.
The strait is vital for 30% of global container traffic. The Red Sea route is shorter and faster, making it the preferred option for most shipping companies. From there, ships can reach various European ports depending on their destination. On the other hand, the Cape of Good Hope route is longer and slower than the Suez Canal route, but it avoids the potential for delays or disruptions.
Ships going to Europe from Africa will now move via a much longer route around the Cape of Good Hope, the bottom tip of Africa. This change increases voyage distances by 40% and raises transportation time and cost. The strait is only about 29 miles wide at its narrowest point, making it easy to block or disrupt shipping.
Read Also:
https://trendsnafrica.com/eu-to-launch-naval-missions-in-red-sea-to-protect-its-cargo-trade/
https://trendsnafrica.com/eu-to-launch-naval-missions-in-red-sea-to-protect-its-cargo-trade/
Goods are often shipped through the Suez Canal to reach different markets. Disruptions can lead to delays in manufacturing and increased costs. The adverse impact will multiply if the disruption continues beyond a few more weeks as it will impact not only trade but local productions of many industries, which rely on just-in-time procurement/import of inputs through the global value chains spanning both Europe and Asia.
