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Red Sea trade hit can be 'managed' amid weak global demand, says WEF

Maroun Kairouz, director of the World Economic Forum for the Middle East and North Africa, told Al-Monitor that the Israel-Hamas conflict has not had a material impact on global energy markets so far.
A ship transits the Suez Canal toward the Red Sea on Jan. 10, 2024, in Ismailia, Egypt.

The economic impact caused by the increase in attacks by the Houthi rebels on ships in the Red Sea since mid-November and subsequent Western airstrikes on the Iran-backed militia in Yemen can be “managed” if global demand remains weak, according to the World Economic Forum. 

There have been more than two dozen Houthi attacks on ships traversing the Red Sea since mid-November. The Red Sea route through the Suez Canal accounts for about 12% of all global trade and acts as the main waterway for ships moving goods between Europe and Asia, including the Middle East. Running through Egypt, the canal also contributes a substantial amount to the country's economy, but millions of dollars have been siphoned off its revenues since the Houthi attacks increased, and ships have avoided the area. 

In an interview with Al-Monitor, the WEF’s head of Middle East and North Africa Maroun Kairouz said global trade was resilient and would be able to cope in the short-term.

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