- ORIGINAL NEWS
Shipping boss says ongoing Red Sea disruption could have ‘significant consequences’ for global growth
- SUMMARY
Global trade disruptions could result from ongoing attacks on ships in the Red Sea by Houthi militants.
Ships are being diverted around Africa, which can add weeks to travel time and raise freight rates.
Maersk, a major shipping company, warned of potential “significant consequences” for global growth if the situation persists.
Alternate trade routes are now incurring additional travel time and increased costs.
The World Bank’s deputy chief economist raised concerns about global growth prospects due to various risks, including Middle Eastern conflicts and the Ukraine war.
These interruptions have the potential to affect economic expansion worldwide.
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“An oil tanker was hijacked near the Gulf of Oman on Thursday.”
“The company announced Friday its vessels would be diverted from the Red Sea — — for the “foreseeable future.””
“Maersk and other shipping giants are diverting vessels away from the Red Sea and around the south of Africa, adding to journey times and driving up freight rates.”
“Ongoing disruption to trade flows through the Red Sea could hit global economic growth, the head of one of the world’s largest container shipping firms said Thursday.”
“Vessels are instead traveling around the southern coast of Africa, which can add between two to four weeks to a Europe-Asia voyage.”
“Clashes have continued into the new year despite the launch of a U.S.-led military taskforce which has seen major powers send warships to the area.”
“Houthi militants this week launched the largest attack of the campaign so far.”
“Companies including Sweden’s Ikea have warned of potential product delays as a result, while freight rates are moving higher.”
“Maersk further said this week that some inland transportations were facing delays due to a wave of strikes in Germany.”
“World Bank meanwhile said Tuesday that global growth is set to mark its worst half decade for 30 years.”
“The World Bank meanwhile said Tuesday that global growth is set to mark its worst half decade for 30 years.”
“Ayhan Kose, the group’s deputy chief economist, told CNBC that the world economy faced a host of risks, including escalations of conflict in the Middle East or the war in Ukraine—.”