Threats to Maritime Navigation Prompt Saudi Boosting of Regional Alliances

The commander of the Saudi Royal Navy floats the first corvette from the Sarawat project in 2019(SPA)
The commander of the Saudi Royal Navy floats the first corvette from the Sarawat project in 2019(SPA)
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Threats to Maritime Navigation Prompt Saudi Boosting of Regional Alliances

The commander of the Saudi Royal Navy floats the first corvette from the Sarawat project in 2019(SPA)
The commander of the Saudi Royal Navy floats the first corvette from the Sarawat project in 2019(SPA)

Need for more international cooperation and coordination to deter threats facing the safety of waterways in the Arab region is increasing, especially for countries bordering exposed maritime corridors.

Safeguarding maritime navigation is geopolitically vital for the global economy.

Saudi Arabia, for example, oversees two important maritime routes in the Arabian Gulf and the Red Sea, with its coasts stretching for about 3,400 kilometers and its kingdom including 1,300 islands.

This has prompted the Saudi Defense Ministry to make building high combat capabilities for its military forces part and parcel of its strategy to meet regional challenges and threats.

The Kingdom has also strengthened its naval military capabilities through implementing qualitative projects that included signing deals for ships and aircraft and participating in naval drills with various other countries.

More so, political and military alliances were formed to protect maritime navigation.

It is worth noting that Saudi Arabia, which has one of the world’s largest military budgets, is looking to localize some 50% of its military spending by 2030.

Maritime navigation in the Arab Gulf has come under frequent attacks, mostly staged by Iranian proxies.

Iran-backed Houthi militias have been responsible for numerous terrorist hits that threatened navigation in Red Sea waters.

Houthis rely heavily on planting Iran-made naval mines.

The Saudi-led Arab Coalition has said it has found and destroyed five Iranian-made “Sadaf” naval mines during the past 24 hours, according to a statement published on Monday.

The coalition said it has seen an increase in the Houthi militia’s activity in planting naval mines in the southern parts of the Red Sea and the Bab al-Mandab strait in recent weeks.

There is an estimated 160 arbitrarily planted naval mines threatening Yemeni waters at the moment.

Houthis also use remote-controlled explosive vessels to threaten trade ships and civilian institutions in the Red Sea.

Royal Saudi Naval Forces (RSNF) Commander Vice Adm. Fahad Abdullah Al-Ghofaily, speaking at a recent event in Riyadh, recounted attacks that targeted three oil tankers and over three commercial ships sailing the region’s waters.

Commenting on finding solutions for those threats, writer and political researcher Abdullah al-Junaid argues that the source of danger must be first defined and the partial political cover given to some regional players, such as Iran and Turkey, must be lifted.

On the political and military alliances and blocs, Junaid noted that the maritime leadership of the Gulf Cooperation Council (GCC) is one of the regional examples of political and military alliances formed to secure navigation in the Strait of Hormuz.

It was established to safeguard navigation based on common interests and the stability of energy markets.

The Peninsula Shield Force, which is the military arm of the GCC, must be viewed from the scope of future challenges it will meet, added Junaid.

Threats facing Saudi Arabia also prompted the formation of naval military alliances designed to raise readiness levels, enhance maritime security in the Arabian Gulf, and protect vital and strategic interests.

Early in 2020, the Council of Arab and African States Bordering the Red Sea and the Gulf of Aden was created as a mechanism for improving the security of regional waterways. This new Arab-African alliance has eight members: Djibouti, Egypt, Eritrea, Saudi Arabia, Somalia, Sudan, Jordan and Yemen.

In November 2019, a multinational maritime security initiative, Coalition Task Force (CTF) Sentinel, composed of Australia, Bahrain, Saudi Arabia, the UAE, the UK, Albania and the United States, was also established with the aim to protect commercial vessels in the Arabian Gulf, the Gulf of Oman and Bab Al-Mandeb.

As for the steps Saudi Arabia has taken to modernize its naval forces, the kingdom witnessed in July 2018 the state-owned Saudi Arabian Military Industries (SAMI) signing a contract with Spanish shipbuilding company Navantia to build five Avante 2200 corvettes for the RSNF.

The deal is set to be completed by 2022. In addition to the Avante 2200 corvettes, the contract includes setting out a plan for the creation of a naval construction center in Saudi Arabia. According to SAMI the agreement would “localize more than 60 percent of ships combat systems works,” including installation and integration in the Saudi market.

Riyadh has sought partnerships in the past few years with international suppliers to boost its domestic manufacturing capacity.

Regarding the localization of military manufactures, Saudi Arabia has succeeded in establishing joint cooperation with French builder CMN for the production and export of 39 HSI32 Inceptors.

The vessels are among the most modern speedboats and will contribute to raising combat readiness of the maritime units and help protect the strategic interests of the kingdom.



Cash Shortage Squeezes Gaza Residents

Palestinian children queue for a hot meal at a charity kitchen in Gaza City on April 30, 2025. (Photo by Omar AL-QATTAA / AFP)
Palestinian children queue for a hot meal at a charity kitchen in Gaza City on April 30, 2025. (Photo by Omar AL-QATTAA / AFP)
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Cash Shortage Squeezes Gaza Residents

Palestinian children queue for a hot meal at a charity kitchen in Gaza City on April 30, 2025. (Photo by Omar AL-QATTAA / AFP)
Palestinian children queue for a hot meal at a charity kitchen in Gaza City on April 30, 2025. (Photo by Omar AL-QATTAA / AFP)

Even when food is available, many in Gaza cannot afford to buy it, as the enclave suffers from a severe cash shortage. Israel has blocked the entry of new currency into the territory since October 7, 2023, leaving residents at the mercy of money changers who have hiked exchange rates on remittances to exorbitant levels.

Palestinians in Gaza primarily rely on the Israeli shekel for daily transactions, which used to enter the strip through banks operating under the Palestinian Monetary Authority, supplied by the Bank of Israel.

Banking operations in Gaza have ground to a halt since the start of the war, and no fresh banknotes have entered the enclave, worsening an already dire humanitarian situation. Residents say they have been left at the mercy of traders who exploit the cash shortage to impose arbitrary rules on currency use.

'The Traders’ Game'

Dubbed “the traders’ game” by many in Gaza, the practice began with merchants refusing to accept worn-out banknotes and certain coins, such as the 10-shekel piece (worth about $3), which have all but vanished from local markets. Some vendors now reject older versions of bills - like the brown-hued 100-shekel note (around $28) - insisting instead on the newer yellow ones. The same rules apply to various denominations.

Speaking to Asharq Al-Awsat, Hani Jahjouh, a resident of al-Shati Camp west of Gaza City, said vendors selling vegetables and essential goods - when available - often refuse worn banknotes or specific coins, claiming they are counterfeit or easily faked.

“This just adds to the burden of people already crushed by impossible living conditions,” said Jahjouh, 59. “We don’t have solutions. We don’t even know where to get the money they’re asking for.”

Only a very small number of traders accept digital payments, and even then, residents say, they impose tough conditions - such as inflated prices or demands for partial payment in cash.

Displaced Gazan Duaa Ismail, originally from Beit Hanoun in the north of the enclave, says even when goods are available, she cannot afford them due to a lack of cash.

“We’re suffering badly from a shortage of money, and that makes it even harder to get basic items like flour and sugar - when they’re even in stock,” she told Asharq Al-Awsat from a shelter in Gaza City’s Sheikh Radwan neighborhood.

Ismail said that during a brief ceasefire, some traders had accepted digital payments through mobile apps. “But once the war resumed, things worsened, and they stopped taking them altogether,” she said.

Salaries They Can’t Spend

The crisis has also hit public-sector employees, private workers, and international aid staff, many of whom receive salaries through bank transfers or mobile wallets but have no way of accessing their funds with banks shuttered. They are forced to rely on currency dealers or traders with access to physical cash.

Amjad Hasballah, an employee with the Palestinian Authority, said he has been cashing his monthly salary through mobile banking apps for over a year and a half, paying a steep commission to money traders in return.

“When I received my last salary in early April, the commission had reached 30%,” he said.

Speaking to Asharq Al-Awsat, Hasballah explained that at the start of the war, commissions hovered around 5%, but they spiked during Ramadan, peaking at 35% around Eid al-Fitr, before dipping slightly to 30%.

“My salary is just 2,800 shekels. When I pay a 30% fee, there’s barely anything left,” he said bitterly. “At this point, the traders might as well take the whole salary and just give us pocket money.”

Caught in a Trap

Jamal Al-Mashal, a father of six who lost two children in an Israeli airstrike, said he lives off 1,000 shekels (about $280) in monthly international aid. But even that amount is slashed by up to 30% when he exchanges it through local traders.

“People in Gaza have become a cash trap for currency dealers and big traders,” he said. “They’re exploiting our desperation, and it’s like a harvest season for them - raking in profits while we suffer.”

The poorest and most vulnerable are hit hardest. Many international agencies rely on electronic payment platforms to distribute aid to these groups, who often have no access to physical currency.

No Oversight, No Restraint

The Hamas-run government has made attempts to cap commission rates at 5%, but those efforts have largely failed. Officials blame ongoing Israeli targeting of personnel involved in regulating the process.

Money changers defend the high fees, arguing that the lack of currency entering Gaza leaves them with limited options.

“We raise commission rates because there’s simply no new cash coming in,” one trader told Asharq Al-Awsat. “Once money is distributed to the public, we have no way of getting it back. What goes out doesn’t return.”

He added that while ministries and law enforcement have tried to impose limits, traders view the rules as unfair. “There have been attempts to regulate us, but we haven’t complied - they’re asking too much from us under impossible conditions,” he said.

Some municipal leaders and community elders in Gaza have recently appealed to the Palestinian Monetary Authority in Ramallah to intervene in what they describe as unchecked profiteering by traders controlling access to scarce cash.

They have called for greater oversight, including monitoring and freezing the traders’ bank accounts.

The authority has repeatedly warned against exploitation of civilians and threatened to take action. But in practice, traders continue to charge hefty commissions on money transfers with little deterrence.

The Authority has urged residents to use its Instant Payment System available through mobile banking apps, which it says offers a practical alternative to cash, promotes digital payments, and enables real-time transactions.

Cash Squeeze Tightens Further

Despite the hardship, Israel is considering new measures that could further tighten the financial stranglehold on Gaza. One proposal involves withdrawing the 200-shekel banknote (worth about $55) from circulation, on the grounds that Hamas allegedly uses it to pay salaries to its fighters.

The suggestion was reportedly made by Israeli Foreign Minister Gideon Sa’ar to Bank of Israel Governor Amir Yaron, who rejected the move. Other proposals include voiding the serial numbers of banknotes believed to be inside Gaza, effectively rendering them worthless, a step that could deliver a significant financial blow to Hamas.

According to a report published Tuesday by the Israeli daily Maariv, the proposal has backing from several ministers and economists both within and outside the central bank.

The report estimated that around 10 billion shekels in high-denomination bills - 100 and 200 shekels - remain in circulation within Gaza. These notes entered the enclave over the years through official banking channels supplied by the Bank of Israel.

Economists told Maariv that Gaza residents receive an estimated 150 to 200 million shekels each month through digital transfers from aid organizations and the Palestinian Authority. That money is then converted into cash within markets dominated by Hamas and supported by a network of money changers.

Israeli security sources estimate that Hamas has accumulated up to five billion shekels since the war began and has spent nearly one billion shekels on salaries for fighters and new recruits. The sources claim Hamas has profited significantly by reselling aid and fuel at inflated prices during the conflict.