Red Sea Attacks by Houthi Rebels Affect Most UK Exporters, Survey Shows

By Jace Dela Cruz

Feb 26, 2024 12:28 AM EST

A British Chambers of Commerce (BCC) survey has revealed that most UK exporters and manufacturers have been affected by Red Sea disruptions that stemmed from shipping attacks by Yemen's Iranian-backed Houthi rebels. 

(Photo : AFP via Getty Images)
A picture taken on May 28, 2022, shows loading docks at the port of Yemen's Red Sea coastal city of Hodeida, around 230 kilometres west of the capital.

UK Exporters Feel the Impacts of Red Sea Attacks

According to Reuters, the survey showed that 55% of exporters reported disruption, like 53% of manufacturers and business-to-consumer services firms, which include retailers and wholesalers. Overall, 37% across all businesses reported feeling the impact.

William Bain, BCC's head of trade policy, noted that there has been "spare capacity in the shipping freight industry to respond to the difficulties, which has bought us some time."

However, he cautioned that the longer the current situation persists, it could lead to the building up of cost pressures. Some businesses have reported challenges such as a fourfold increase in container hire costs, delivery delays of three to four weeks, cashflow problems, and shortages of parts.

The Bank of England has identified the disruption in the Red Sea as one of the primary upside risks to inflation this year. Despite concerns, the economic impact of the attacks and broader conflict in the Middle East on Britain has been less severe than initially feared, according to Reuters.

READ NEXT: Houthi Rebels Fired at 2 Commercial Ships in Red Sea Days After US, UK Hit Dozens of Houthi Targets in Yemen

Drone and Missile Strikes in the Red Sea

Houthi rebels have been conducting drone and missile strikes in the Red Sea, Bab al-Mandab Strait, and Gulf of Aden since November in support of Palestinians amid the ongoing Israel-Hamas war. 

The survey conducted by the BCC between January 15 and February 9 received responses from 1,087 firms, the majority of which had fewer than 250 employees.

The S&P Purchasing Managers' Index also revealed that British businesses encountered the fastest cost increase in six months in February. 

While many manufacturers pointed to higher freight expenses due to disruptions in the Red Sea, escalating wage bills emerged as a more significant concern for most.

READ MORE: US Designates Houthis as Terrorists, Launches Fresh Strikes in Yemen After Rebels Hit Another US-Operated Ship

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