Houthi attack raises concerns about global trade

Houthi attack raises concerns about global trade

2023-11-21 08:22:49

After Houthi rebels hijacked a car freighter in the Red Sea and kidnapped it to Yemen, concerns are growing about ongoing difficulties on one of the world’s most important trade routes. After all, a large part of the goods traffic between Asia and Europe first passes through the Red Sea and then the Suez Canal, which leads through Egypt into the Mediterranean. Yemeni rebels, funded by Iran, have threatened to attack any ships they believe have ties to Israel in support of their “brothers in Gaza.”

Tim Canning

Correspondent for economics and politics in Japan based in Tokyo.

The Japanese trade minister warned of disruptions to supply chains. “Many goods, including cars, are transported on this route, which connects Europe and Japan via the Suez Canal,” Trade Minister Yasutoshi Nishimura said at a news conference in Tokyo.

Among other things, Japan gets a large part of its energy imports from the Middle East. However, Nishimura said the oil and liquefied natural gas tankers that supplied the country did not often pass through the now-affected waters. Still, ongoing problems on the route could hit the Japanese economy hard.

Gas prices rise due to higher risks

The fact that concerns about an expansion of the Middle East conflict do not only affect the country in the Far East can be seen, among other things, in the European gas market. The prices for futures contracts there rose by 6.9 percent on Monday. Traders primarily referred to the increased risks for trade in the region.

The hijacked ship called “Galaxy Leader” is operated by the Japanese shipping company Nippon Yusen (NYK), sails under the flag of the Bahamas, but belongs to the company “Galaxy Maritime Ltd.”, registered on the British Isle of Man, and behind which an Israeli businessman should stand.

Attack from the air

The British company has now announced that the cargo ship “Galaxy Leader” was “illegally boarded by military personnel by helicopter” on November 19th and is now anchored in the port of Hodeidah in Yemen. The Houthi rebels published a video on the Internet that shows how a helicopter drops armed men on a cargo ship – apparently the “Galaxy Leader” – and how they apparently take control of the ship and its crew.

The owner, Galaxy Maritime, said there had been no communication with the ship since the attack. “The owners and operators consider the capture of this ship to be a gross violation of the freedom of passage for the world fleet and a serious threat to international trade.” Beyond that, the shipping company does not want to comment on the political or geopolitical situation.

USA demands immediate release

The United States has now also commented on the incident. A State Department spokesman in Washington condemned the kidnapping as a gross violation of international law. “We call for the immediate release of the ship and its crew and will consult with our allies and partners at the United Nations on appropriate next steps.”

According to initial information from Israel, the ship was traveling empty from Turkey towards India when it was attacked. A report in the Japanese business newspaper “Nikkei” said on Tuesday that the ship was loaded with cars. There are said to be 25 sailors of various nationalities on board, but no Israelis. NYK said it had formed a response team to gather intelligence and ensure the safety of the crew.

Christoph Ehrhardt, Beirut Published/Updated: Recommendations: 44 Christoph Ehrhardt Published/Updated: Recommendations: 34 A comment from Gregor Grosse Published/Updated: Recommendations: 69

The Japanese government announced that it would mediate the release of the cargo ship. Foreign Minister Yoko Kamikawa said Tokyo was in contact with both Israel and the rebels. At the same time, however, she called for the support of Arab states with which Japan usually has good trade relations. “In addition to directly contacting the Houthi rebels, we also urge Saudi Arabia, Oman, Iran and other concerned countries to urge the Houthi rebels to release the ship and crew members as soon as possible,” Kamikawa said.

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