Attacks on Red Sea Ships Disrupt Jordan’s Commercial Sector

A Houthi military helicopter flies over a cargo ship in the Red Sea. (Reuters)
A Houthi military helicopter flies over a cargo ship in the Red Sea. (Reuters)
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Attacks on Red Sea Ships Disrupt Jordan’s Commercial Sector

A Houthi military helicopter flies over a cargo ship in the Red Sea. (Reuters)
A Houthi military helicopter flies over a cargo ship in the Red Sea. (Reuters)

Jordan relies on imports to cover the majority of its food needs, most of which cross the country’s only seaport of Bab al-Mandab strait, as the Houthi group continues to attack commercial ships in the Red Sea.
Jordanian imports cover between 85 and 90 percent of the country’s food needs. 65 percent of the volume of these imports cross Bab al-Mandab Strait towards the port of Aqaba. Fears have been mounting over the repercussions of the security crisis in the Red Sea and the continuous attacks by the Houthis against commercial ships.
According to a report by the Arab World Press (AWP), the Houthi attacks disrupted global trade in the Red Sea, and major shipping companies diverted their ships, choosing longer route around Africa instead of passing through the Suez Canal.
Yemen’s Houthi groups are targeting ships in the Red Sea, in support of the Hamas movement, which is fighting Israel in the Gaza Strip in a war that broke out on Oct. 7.
These attacks led to higher shipping costs and longer delivery times, as stated by Mahmoud Al-Daoud, owner of a small company that imports canned food in Jordan.
Al-Daoud told AWP that his company's financial capabilities do not give him much room for adventure or to bear losses if the tanker carrying his goods was “sabotaged or seized,” or even to incur additional shipping and delivery costs.
“The profit margin after transportation and storage costs in normal situations does not exceed 20 percent, from which the company pays the salaries of employees and workers and other operational costs. Therefore, any additional expenses will cause losses in profits and may reach capital,” he remarked.
In December, Maersk, one of the largest shipping companies in the world, suspended shipping through the Red Sea and Suez Canal “until further notice”, after one of its ships was attacked by the Houthis off Yemen. The attack was confronted by American forces stationed in the area. US Central Command said that its helicopters sank three Houthi boats.
Maersk had resumed shipping through the Red Sea on Dec. 24 after the United States announced the start of an operation to protect ships near Yemen with the participation of more than 20 countries.
However, “the challenge is great” for the commercial sector in Jordan, said the head of Jordan’s Chamber of Commerce, Khalil Haj Tawfiq, especially with regard to the flow of goods into the country and shortages in local markets.
As the Houthi attacks on ships in the Red Sea continued, the Jordanian Ministry of Transport quickly concluded an agreement with the Arab Bridge Maritime Company to operate the Arab line for land and sea transport between the port of Aqaba and the Egyptian ports overlooking the Mediterranean Sea. The Arab Bridge Maritime Company was established in 1985 after an agreement between the governments of Jordan, Egypt and Iraq, as its website explains.
In a meeting held last week in the Amman Chamber of Industry, Jordanian Minister of Transport Wissam Al-Tahtamouni confirmed that the cessation of shipping lines through the Red Sea will lead to an increase in the cost of insurance in addition to longer delivery times, for imports and exports.
He added that the currently proposed alternative is the continued flow of goods through the land and sea transport lines of the Arab Bridge company.



EU Sees €28 Billion Hit from Trump’s Steel, Aluminum Tariffs

FILED - 12 July 2020, Lower Saxony, Salzgitter: An employee walks along coiled steel at Salzgitter AG. Photo: Julian Stratenschulte/dpa
FILED - 12 July 2020, Lower Saxony, Salzgitter: An employee walks along coiled steel at Salzgitter AG. Photo: Julian Stratenschulte/dpa
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EU Sees €28 Billion Hit from Trump’s Steel, Aluminum Tariffs

FILED - 12 July 2020, Lower Saxony, Salzgitter: An employee walks along coiled steel at Salzgitter AG. Photo: Julian Stratenschulte/dpa
FILED - 12 July 2020, Lower Saxony, Salzgitter: An employee walks along coiled steel at Salzgitter AG. Photo: Julian Stratenschulte/dpa

The European Union estimates that the first wave of Donald Trump’s steel and aluminum tariffs will hit as much as €28 billion ($29.3 billion) of the bloc’s exports in what would be a massive escalation in the US president’s trade war, Bloomberg reported.

The amount of goods — which the EU assesses will include derivative products as well — would be about four times larger than the last time Trump targeted the bloc’s metals sector, according to people familiar with the EU’s thinking.

EU trade chief Maros Sefcovic debriefed the bloc’s ambassadors on Friday after his visit to Washington to meet with his US counterparts. He cautioned that the situation is in flux and the details and the scope of any tariffs could still change, said the people, who spoke on the condition of anonymity.

As part of his effort to rewrite global trade rules, Trump announced a series of duties including 25% tariffs on steel and aluminum exports that could take effect as soon as March 12. He’s also announced reciprocal tariffs based on policies of partners that are seen as obstacles to US trade.

The European Commission, which has authority over EU trade actions, declined to comment.

For the EU, the fight over American metals tariffs started in 2018 during Trump’s first term, when the US hit nearly $7 billion of European steel and aluminum exports with duties, citing national security concerns. At the time, officials in Brussels scoffed at the notion that the EU posed such a threat.

In that first salvo, the US hit steel goods with 25% tariffs and aluminum with 10%, and included exemptions for certain products. Bloomberg reported earlier that this time around, no exemptions were planned.

The 27-nation bloc retaliated by targeting politically sensitive companies with retaliatory duties, including Harley-Davidson Inc. motorcycles and Levi Strauss & Co. jeans. The measures were applied product-by-product and included agricultural goods and apparel in addition to steel and aluminum products.

The two sides agreed to a temporary truce in 2021, when the US partly removed its measures and introduced a set of tariff-rate quotas above which duties on the metals are applied, while the EU froze all of its restrictive measures.

The EU has said that it would respond quickly and proportionally to US tariffs and could reactivate as a first step the lists previously suspended. The commission has been preparing various lists with different sectors and goods targeted with the principle of causing more harm on the American side, including in sensitive constituencies, Bloomberg previously reported.

The commission has said that unfreezing the suspended tariffs, which are on pause until the end of March, could be done quickly.

Sefcovic, who met with US Commerce Secretary Howard Lutnick, Jamieson Greer, his pick for US trade representative and National Economic Council Director Kevin Hassett this past week, told EU envoys that the atmosphere was positive but no negotiations were conducted yet, said the people.

According to Bloomberg, Sefcovic said he used the meeting as a first point of contact to open the channels of communication and to try to debunk claims by the Americans that he said were false, including that Europe’s value added tax is unfair to the US, they said.

In order to avoid a trade clash, Sefcovic offered to his American counterparts a deal to lower tariffs on industrial goods, including cars, one of Trump’s longstanding demands.