Attacks by Houthi rebels in the Red Sea are causing delays of up to four weeks and higher shipping costs for British firms, according to a survey by the British Chambers of Commerce. More than a third of firms surveyed said they have been affected, rising to over half for exporters. The BCC warns that higher costs could contribute to higher prices in the UK economy. The long-running conflict has led to rerouting of shipments around Africa’s southern tip, adding to delivery times. Some firms cited price rises of 300% for container hire.
William Bain, BCC head of trade policy, warned that “the longer the current situation persists, the more likely it is that the cost pressures will start to build”. Exporters, retailers, wholesalers and manufacturers were most affected, with some left short of goods and components or facing cashflow difficulties. Rachael Waring, of Warings Furniture, which imports interior decor for pubs and restaurants, said the conflict had been affecting her business since before Christmas. She said her firm is budgeting for higher costs, while attempting to negotiate lower prices with Chinese manufacturers.
The BCC represents over 50,000 businesses. It is calling for additional government support for exporters, including the creation of an exports council. The Houthi group initially attacked commercial vessels travelling through the Red Sea to support Hamas. The US and the UK have responded with air strikes on Houthi targets in Yemen. Maersk and Mediterranean Shipping Company are among the large shipping firms forced to divert vessels along a longer route by the Red Sea situation. Earlier this month tea brands Tetley and Yorkshire warned that supplies could be affected by the conflict
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