FUKUTOMI GAZETTE – The Impact of the Houthi Organization on the World

Global geopolitical factors continuously influence countries’ economic, political, and cultural aspects worldwide, inevitably affecting our lives. Recently, the notable focus has been on the Houthi organization’s attacks on shipping vessels in the Red Sea and the Suez Canal, causing a significant impact on global economic activities. Despite the interception of missile attacks on ships by the United States and ten Western countries, including Bahrain, the results have been less than ideal.

Since the 1990s, the radical military organization known as the Houthi faction in Yemen has been backed by the Iranian government to resist the local government. This led to the assassination of Houthi leader Hussein Badreddin by the Yemeni government, and later, his brother Abdul took control and continued to oppose the government. Their enemies include Saudi Arabia, Israel, and the United States, all of whom are hostile towards them. During the Israel-Hamas conflict in Gaza, the Houthi organization supported Hamas. It carried out attacks on commercial ships and oil tankers in the Red Sea and the Suez Canal, especially those related to Israel. Several shipping companies, such as Maersk, CMA, and MSC, have ceased using the Suez Canal and opted for the Cape of Good Hope route. This route takes about 14 days and covers a distance of over 7100 kilometers, leading to a significant cost increase. As for the vessels that insist on using the Suez Canal, their insurance fees have increased by more than tenfold.

Around 12% of the world’s goods are transported through the Red Sea, with 20% being container ships and 10% being crude oil tankers. The country most affected economically is Egypt since the canal is their primary source of revenue. Other countries primarily experience the impact of extended shipping times, disrupted supply chains, and increased shipping costs, leading to imbalances in supply and demand and ultimately contributing to global inflation.

Many commentators believe the issue’s complexity is more intense than initially estimated. The Houthi armed militants, with support from Iran, possess a significant amount of military weaponry, including a large number of unmanned missile-launching aircraft, priced at around a few thousand to ten thousand US dollars each. In contrast, the United States interception missile system costs two million dollars per unit and cannot wholly intercept all unmanned missiles. Many countries, such as China, Russia, certain Western countries, and Islamic nations, stand by and neither support nor condemn the actions of the Houthi organization.

Unless the Houthi armed group can be completely eliminated, which is considered challenging, the future days will be filled with uncertainties.

Original by Dr. Steve Wong       

February 16, 2024

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