Urgent International Action Needed to Address Houthi Attacks Threatening Global Supply Chain, Says Cyprus Shipping Chamber

The Director General of the Cyprus Shipping Chamber, Thomas Kazakos, has issued a call for urgent international intervention to address the escalating threat posed by Houthi attacks against ships traversing the Red Sea. Kazakos emphasized the severe risk these attacks pose to the global supply chain and warned that the consequences could surpass those of the coronavirus pandemic if not promptly addressed.

In an interview with the Cyprus News Agency (CNA), Kazakos highlighted the vulnerability of Cyprus, an island state where 98% of trade heavily relies on maritime transportation. Originally sparked by the conflict between Hamas and Israel, Houthi attacks initially targeted ships associated with Israeli interests. However, according to Arsenio Domíguez, the new Secretary-General of the International Maritime Organisation (IMO), these attacks have now broadened to pose a wider threat to global maritime trade.

Domíguez, speaking to CNA, expressed the alarming nature of the situation, stating, "What started as a regional conflict has escalated into a threat to global maritime trade. We need a coordinated international response to ensure the safety of shipping routes." Major shipping companies, including industry giants like Maersk, Hapag Lloyd, and MSC, have reportedly halted transit through the critical sea passage, constituting approximately 15% of international trade, as per Domíguez. This unprecedented move has raised concerns about broader economic implications.

Kazakos urged the strengthening of the Prosperity Guardian operation to safeguard navigation and protect seafarers. He emphasized the need for increased naval and air forces with clear terms of reference for providing protection. Additionally, Kazakos called for enhanced intelligence sharing among nations to better anticipate and counteract potential threats.

The Director General outlined potential consequences of the ongoing situation, highlighting that essential commodities like fuel, wheat, iron, and pharmaceuticals could face delays, leading to inflationary pressures. Bypassing the Suez Canal, a crucial sea route from Asia to Europe, would result in increased travel time, fuel costs, and delayed deliveries, impacting global economies.

Leading industry associations, including the International Chamber of Shipping and the Baltic and International Maritime Council, echoed Kazakos' concerns in a joint statement. They called for an immediate diplomatic resolution to the conflict and urged governments to prioritize the protection of shipping lanes.

Expressing doubts about the effectiveness of armed guards alone, Kazakos argued that attacks, often executed using drones, pose challenges for ship systems and patrolling forces. He called for the immediate involvement of naval and air forces, stating, "The international community must support and protect global trade, which is 90% dependent on global shipping."

Kazakos' comments underscored the urgency of a swift resolution, warning that the increase in oil prices and transport costs could be felt in the coming weeks, impacting importers, consumers, and national economies. He stressed the necessity of global cooperation to address the escalating threat to maritime trade.

By fLEXI tEAM