Meengla
Elite Member
Economic impact of the Houthis action in the Red Sea. I remember in the old PDF an Israeli supporter (Sammuel, I think) was saying that Eilat is not that important and it is the northern Israeli ports which are more important and so Israel is not too impacted.
But this Israeli article dents that argument.
As Yemen’s Iran-backed Houthi militants step up assaults on Israel-linked ships, the world’s largest container freight companies have temporarily suspended sending their vessels through the Red Sea, threatening to shut down a key trade route of Israeli imports and exports from the Far East and their passage to Europe.
...
Instead, container ships bound for Israel from the Far East will now need to take a 40 percent longer route around Africa and the Cape of Good Hope, increasing the shipping time of goods by two to four weeks and raising the costs per ship by up to $1 million.
The additional costs will make goods more expensive for importers and trickle down to higher costs for consumers. That is as ships sailing for Israel since the war erupted already have higher freight costs, as they need to pay an additional war risk premium levied by marine insurers.
For Israel, this is a major concern, as air freight is not an option, since 99% of goods are imported by the sea and trade with Asia has soared.
“The center of gravity in the economy is very clearly moving to the countries of the Far East, and accordingly, Israel’s trade with those countries has also been increasing and accounts for 25% of Israeli exports and imports,” said Prof. Shaul Chorev, a retired Israeli Navy rear admiral and head of the Research Center for Maritime Policy and Strategy at the University of Haifa. “Because of the attacks, there is almost no activity at the Israeli Red Sea port of Eilat although most of the containers are headed to Israel’s main ports in Ashdod and Haifa.”
But this Israeli article dents that argument.
As Yemen’s Iran-backed Houthi militants step up assaults on Israel-linked ships, the world’s largest container freight companies have temporarily suspended sending their vessels through the Red Sea, threatening to shut down a key trade route of Israeli imports and exports from the Far East and their passage to Europe.
...
Instead, container ships bound for Israel from the Far East will now need to take a 40 percent longer route around Africa and the Cape of Good Hope, increasing the shipping time of goods by two to four weeks and raising the costs per ship by up to $1 million.
The additional costs will make goods more expensive for importers and trickle down to higher costs for consumers. That is as ships sailing for Israel since the war erupted already have higher freight costs, as they need to pay an additional war risk premium levied by marine insurers.
For Israel, this is a major concern, as air freight is not an option, since 99% of goods are imported by the sea and trade with Asia has soared.
“The center of gravity in the economy is very clearly moving to the countries of the Far East, and accordingly, Israel’s trade with those countries has also been increasing and accounts for 25% of Israeli exports and imports,” said Prof. Shaul Chorev, a retired Israeli Navy rear admiral and head of the Research Center for Maritime Policy and Strategy at the University of Haifa. “Because of the attacks, there is almost no activity at the Israeli Red Sea port of Eilat although most of the containers are headed to Israel’s main ports in Ashdod and Haifa.”
