The Yemen War and shipping

Yemen, also known as the Republic of Yemen, is a country located on the Arabian Peninsula in the southwestern part of Asia. It has a rich history and culture dating back thousands of years. Unfortunately, Yemen has been engulfed in a brutal civil war since 2014 and has been grappling with a humanitarian catastrophe, claiming hundreds of thousands of lives. However, the effects of the war are not confined to Yemen alone but extend to a global scale. In this article, you will learn about the Yemen crisis and its impact on international shipping, primarily from China.

The Yemen war

Civil war in Yemen

The civil war in Yemen began in 2014 and continues unabated to this day. It primarily erupted due to political instability, power struggles, and regional rivalries, with the Houthi rebels seizing control of the capital, Sanaa. In March 2015, a coalition of Arab states led by Saudi Arabia launched a military intervention in Yemen aimed at countering the Houthis, further exacerbating the conflict and leading to a humanitarian crisis in Yemen.

What are the effects of the conflict in Yemen?

The conflict in Yemen heightens the risk of danger in the waters around the Arabian Peninsula, particularly in the nearby Bab al-Mandab Strait, which connects the Red Sea with the Gulf of Aden. The escalation of piracy, attacks on ships, and the presence of armed groups pose a threat to vessels transiting through these waters en route to or from the Suez Canal.

Since November 2023, Houthi rebels, supported by Iran, have conducted at least 34 attacks on ships transiting the waterways leading to the Suez Canal in Egypt, a critical route for energy and cargo from Asia and the Middle East to Europe.

Impact of the Yemen war on shipping from China

Trade between China and Europe primarily occurs through the Gulf of Aden and the Red Sea. Additionally, Chinese-imported oil from the Middle East and Africa flows through the Bab al-Mandab and the Strait of Hormuz. Due to the prevailing situation, many carriers, concerned about the safety of goods, opt for higher insurance costs or select alternative, safer routes.

It is estimated that at least 90% of containers that previously passed through the Suez Canal are now rerouted around Africa and the Cape of Good Hope (South Africa). This results in significantly increased shipping costs. The cost of shipping a 12-meter container from China to Northern Europe has risen from $1,500 to as much as $4,000. This can also extend shipping schedules by up to two weeks, thereby diminishing global container capacity and disrupting supply chains due to the prolonged time vessels require to return to ports for reloading.

While some Chinese companies opt for the longer yet considerably safer route, many others still choose to brave the risks of sailing through the Red Sea. These vessels fly Chinese flags and openly broadcast their “all Chinese crew” status on ship tracking devices, aiming to mitigate potential threats from Houthi attacks.

The crisis in Yemen and China’s stance

Although China already has access to these strategic waterways, securing access to Yemeni ports can support its ambitious Belt and Road Initiative and guarantee access to global trade routes. China has expressed deep concern over tensions in the Red Sea, which have disrupted global trade, forcing many carriers to avoid the Suez Canal. The Chinese Ministry of Foreign Affairs emphasized that China is in close communication with all parties concerned, making positive efforts to reduce tensions.

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