Red Sea alternatives: Impact of regional tensions on trade routes

In a strategic move to ensure safe passage across the Red Sea, some ships are hoisting banners with a clear message: "No Link to Israel."

According to Houthi officials, 64 ships have displayed banners reading "No link to Israel" or its Arabic equivalent, successfully navigating the Red Sea while avoiding potential hostilities.

The strategic waterway has become a focal point due to the repeated Houthi attacks on Israeli or Israel-bound ships heading to Tel Aviv.

In light of continuous Houthi threats targeting Israeli-bound vessels in the Red Sea, shipping companies have temporarily halted transit through the region, redirecting traffic solely through the Cape of Good Hope. This maritime route connects Asia to Africa by circumnavigating the African continent.

However, the alternate route proves to be more expensive and time-consuming.

It is worth noting that Israel also utilizes the Cape of Good Hope passage, along with an additional overland route connecting the Arabian Sea to Israel, as reported by Israeli media.

Israeli shipping companies typically unload cargo in Gulf ports, specifically in the UAE and Bahrain. From there, goods are transported to Israel through Saudi Arabia and Jordan on land.

Amid these developments, global alternatives are being explored should tensions escalate further, and China and other countries might resort to it. Examples include:

-         The Belt and Road Initiative, a Chinese project launched in 2013, connects the East and West overland. Discussions about this alternative resurfaced with the Red Sea tensions.

-         The Northern Sea Route or "Eurasian Land Bridge," linking China to Europe via Russia.

However, with the ongoing Russo-Ukrainian War, Europe seeks substitute trade routes linking it to China to bypass Russia. Notable options include:

-         A trade route connecting India, Iran, and Russia, acting as a substitute amidst Western sanctions on Tehran and Moscow.

-         An economic corridor was announced last year between India, the Middle East, and Europe. This corridor links India with the UAE, passing through Saudi Arabia and Jordan and reaching the Israeli port of Haifa before continuing to Europe through the Mediterranean.
 
 
In conclusion, recent events in the Red Sea highlight the importance of securing new global trade routes. At any given moment, geopolitical, military, or technological factors can render a passage susceptible to closure.