UK Exporters Face Disruption as Houthi Attacks Hit Red Sea

26 Feb, 2024

UK Exporters Face Disruption as Houthi Attacks Hit Red Sea

The British Chambers of Commerce reveals that 55 percent of exporters are grappling with escalated shipping expenses and logistical delays, attributing these challenges to the disruptive assaults orchestrated by Yemen's Houthi rebels in the Red Sea. A comprehensive survey conducted by the British Chambers of Commerce (BCC) underscores the widespread impact of these assaults, with 53 percent of manufacturers and business-to-consumer service providers also reporting increased costs and disruptions. Among a diverse spectrum of businesses, 37 percent indicate being affected by the assaults, drawing from a pool of 1,000 surveyed firms during the period between January 15 and February 9.

Businesses participating in the survey express staggering impacts, citing a fourfold surge in container hire expenses and delivery time extensions of up to four weeks. William Bain, the BCC's head of trade policy, highlights a temporary respite afforded by existing shipping-freight capacity to mitigate the challenges. However, sustained disruption poses an ominous forecast of escalating cost pressures.

The Iran-backed Houthi insurgents' relentless missile and drone onslaught targeting commercial vessels traversing the Red Sea, a vital global maritime artery, has cast a shadow over international trade. The assaults, purportedly aimed at vessels associated with Israel, in solidarity with Palestinians amidst Gaza conflict, have precipitated a 42 percent decline in trade volume navigating the Suez Canal, linking the Red Sea to the Mediterranean.

The repercussions are felt across industries, with Tetley Tea, a prominent UK tea brand, signaling constrained supplies due to Red Sea disruptions. In response, the United States and the UK have launched coordinated strikes against Houthi-affiliated targets, including subterranean munition depots, air defense systems, and radar installations.