Israeli Finance Ministry evaluates effects of Red Sea assaults on maritime transport
(MENAFN) According to a report released by the Israeli Ministry of Finance on Monday, the ongoing attacks by the Yemeni Houthi movement on shipping vessels in the Red Sea have had a relatively limited impact on Israel's trade activities. The report indicates that despite the disruptions caused by these attacks, Israel has not experienced significant inflationary pressures as a result.
Since mid-November, the Houthi rebels have been launching drone and missile attacks on international commercial shipping in the Gulf of Aden, citing their actions as a response to the conflict in the Gaza Strip. These attacks have not only disrupted global shipping routes but have also raised concerns about the potential expansion of conflict and instability in the Middle East region.
The Ministry of Finance highlights that the attacks in the Red Sea have forced shipping companies to reroute their vessels, resulting in longer and more costly voyages around South Africa. This has led to a notable increase in sea transport prices globally, with a staggering 163 percent rise. While Israel may face higher import costs and potential disruptions in the supply chain, the report suggests that the impact on the country's economy remains manageable.
Although the rising cost of sea transportation poses concerns about increased prices for primary commodities and energy, the Ministry clarifies that the cost of sea transport constitutes only a small fraction—approximately three percent—of the total value of imports to Israel. Despite the challenges posed by the ongoing conflicts and disruptions in maritime trade routes, the Ministry emphasizes that Israel remains resilient and capable of navigating through these challenges while ensuring the stability of its economy.
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