The impact of the ongoing crisis around the Red Sea shipping route, which accounts for 50 per cent of the country's exports and 30 per cent of imports last fiscal, will vary depending on the industry, according to a report. Lastly, players in pharma, metals, and fertilisers will not be much impacted.Increasing attacks on ships sailing in the Red Sea region since November 2023 have persuaded shippers to consider the alternative longer route past the Cape of Good Hope. Crude prices rose 5-7 per cent to USD 80/barrel in mid-December 2023, following an escalation of the crisis but prices have since settled in the USD 77-80/barrel range.It is not that the impact of the Red Sea crisis will be negative for all sectors. The extent of this will vary depending on sectoral nuances. Supply chain issues could also intensify, curbing trade volume and renewing inflationary pressures.

Source: The North Africa Journal January 28, 2024 10:17 UTC