Red Sea Unrest Revives Djibouti Ports

Doraleh Port is designated to receive containers and has witnessed a revival due to the disturbances in the Red Sea (Photo by Turki Al-Aguili)
Doraleh Port is designated to receive containers and has witnessed a revival due to the disturbances in the Red Sea (Photo by Turki Al-Aguili)
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Red Sea Unrest Revives Djibouti Ports

Doraleh Port is designated to receive containers and has witnessed a revival due to the disturbances in the Red Sea (Photo by Turki Al-Aguili)
Doraleh Port is designated to receive containers and has witnessed a revival due to the disturbances in the Red Sea (Photo by Turki Al-Aguili)

The unrest in the Bab al-Mandab region, the Red Sea, and the Gulf of Aden has contributed to the recovery of container handling operations in Djiboutian ports in recent months, according to Djiboutian officials.

Container handling at Doraleh Port, Djibouti's largest port, increased by up to 10% compared to the previous months, officials told Asharq Al-Awsat.

Houthi attacks on commercial ships in the Red Sea caused a sharp rise in marine shipping insurance, with fees imposed to cover risks associated with conflicts.

Since November 2023, the Iranian-backed Houthis have been carrying out attacks on commercial ships in the Red Sea that they suspect are linked to Israel or heading to its ports.

They say that this comes in support of the Gaza Strip, which has been witnessing a war since Oct. 7, 2023.

Washington and London have also launched joint military strikes on Houthi positions inside Yemen several times since last Jan. 12.

Advisor of the CEO of Operations at Doraleh Port Ismail Hasan told Asharq Al-Awsat that the port served more than 100,000 containers with an average of 60-70 ships of various sizes last January, and it can receive the largest ships in the world.

All international shipping and navigation companies are in Doraliya Port, serving over 60 ports worldwide.

Last January, the port witnessed an increase in handling by a rate of 5-10% compared to previous months.

During Asharq Al-Awsat's visit to Doraleh Port, the Chinese ship Zhong An Xin Huayuan was anchoring for the first time, according to Hasan.

He explained that the tensions in the Red Sea led new shipping companies to enter as new clients of the Djiboutian ports.

Djibouti has about five specialized ports, including Doraleh Port, and others for various goods, commodities, and iron, some of which are dedicated to energy.

Several Chinese shipping lines have been redeploying their vessels to serve the Red Sea and the Suez Canal in what analysts have said is an effort to exploit China's perceived immunity from the Houthi attacks that have driven most other operators out of the area, according to the Financial Times.

The newspaper said two vessels were listed on the website of Qingdao-based Transfar Shipping, which describes itself as "an emerging player in the transpacific market" as part of its fleet list.

However, Transfar said on Friday that it had stopped operating the ships in February 2023 and needed to know which company was using them now.

The report stated that the move of Chinese lines to the Red Sea comes after most big container shipping lines — including China's Cosco, operator of the industry's fourth-biggest fleet —abandoned the southern Red Sea because of the security risks.

According to Hasan, Djibouti seeks to become a global hub that serves most of the markets, extending from China in the east through the Middle East and the Mediterranean all the way to Northern Europe.

According to official statistics, Djibouti ports witness daily transit of about 90 ships, 59% of which are coming from Asia, while vessels from Europe represent 21%, while other continents, including Africa, represent 16%.

According to the International Monetary Fund (IMF), maritime transport through the Red Sea decreased by approximately 30% in one year.

The International Chamber of Shipping says the Red Sea is a vital route that usually carries about 12% of global trade.

Doraleh Port, established in 2009, is about three kilometers from the gate to the edge of the sea, with a depth of 20 meters and a width of 1,050 meters, and it is considered one of the largest container ports in Africa.

Hasan told Asharq Al-Awsat that the port was equipped with the most advanced handling machines in the world, and it began operating only about three months ago.

The port ranked first in Africa for three consecutive years, and there are 30 mechanisms dedicated to distributing containers registered in a system with unique codes.

Some containers are destined for domestic and neighboring countries, and others are being re-exported to other international ports.

He explained that all the working crews are Djiboutian, with 800 full-timers and about 1,000 hired when needed.

Hasan addressed the establishment of a seaport for Ethiopia in Somaliland after announcing an initial agreement between the two sides, indicating that this would not affect the Djiboutian ports.

The advisor asserted that establishing an Ethiopian port in Somaliland would not affect the Djiboutian ports.

- Freight train to Ethiopia

Doraleh Port is directly connected to the main train terminal to transport goods from the port to Ethiopia.

Djibouti is the main gateway for Ethiopian imports and exports to and from the world.

According to the advisor, the train's journey from the port to Metu in Ethiopia takes 10 to 12 hours before continuing its way to Addis Ababa.

Hasan pointed out that three train lines can be operated simultaneously, while two trains run daily to Ethiopia, with an average of 106 containers for each train.

The Addis Ababa-Djibouti railway line is the first electric-powered railway line designed to Chinese specifications.

Djibouti and Ethiopia benefit from it by establishing industrial and logistical zones and constructing new cities and villages along this line, which passes through the Horn of Africa.

Ethiopia, which exports and imports nearly 90% of goods through Djibouti ports, has plans to expand the train network to extend to Sudan, Kenya, and South Sudan.



Saudi Tourism Gains Momentum in Q1 as Licenses Rise and Workforce Nears One Million

A view of a tourist resort in Al-Khobar, Saudi Arabia. (SPA)
A view of a tourist resort in Al-Khobar, Saudi Arabia. (SPA)
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Saudi Tourism Gains Momentum in Q1 as Licenses Rise and Workforce Nears One Million

A view of a tourist resort in Al-Khobar, Saudi Arabia. (SPA)
A view of a tourist resort in Al-Khobar, Saudi Arabia. (SPA)

The tourism and hospitality sector in Saudi Arabia showed strong operational dynamism and institutional expansion in the first quarter of 2026, according to official data from Saudi Arabia's General Authority for Statistics. Despite the freedom demonstrated in daily price levels and occupancy rates, the sector's regulatory environment saw extraordinary growth in licenses and an influx of both national and expatriate workers.

Indicators confirmed an increase in the total number of licensed tourism hospitality facilities in the Kingdom during Q1 2026 by 22.7 percent, reaching 6,122 facilities compared to 4,988 in the same quarter of 2025. Serviced apartments and other hospitality facilities accounted for the largest share, at 51.6 percent of the total, with 3,159, while the number of licensed hotels reached 2,963.

This facility expansion was paralleled by an increase in the number of establishments; the number of tourism establishments with employees in the Kingdom reached approximately 177,031 during Q1 2026, marking a 9.0 percent growth compared to the corresponding quarter of last year, which then recorded 162,473 establishments.

The total number of people employed in tourism activities saw a 6.5 percent year-on-year jump, increasing the sector's workforce to 1,047,313 employees compared to 983,253 in the same period of 2025.

According to the data, the number of Saudi employees in tourism activities reached 250,094, representing 23.9 percent of the total workforce, while non-Saudis numbered 797,219.

Conversely, the room occupancy rate in hotels decreased to 60.8 percent during Q1 2026, a decline of 2.2 percentage points compared to the same quarter of 2025, which recorded 63.0 percent.

In contrast, the serviced apartments and other hospitality facilities sector showed positive growth; its occupancy rate increased by 1.0 percent to reach 51.6 percent compared to 50.7 percent in the corresponding quarter in 2025.

At the price level, the average daily rate for a hotel room recorded an 11.4 percent decrease, reaching 423 Saudi Riyals compared to 477 Riyals in Q1 2025. The average daily rate in the serviced apartments and other hospitality facilities sector also saw a slight decrease of 1.2 percent, stabilizing at 206 Saudi Riyals compared to 209 Riyals.

Despite fluctuations in prices and occupancy, the Authority's statistics revealed a tangible improvement in the average length of guest stay:

In Hotels: The average length of stay increased by 2.0 percent, reaching 4.2 nights during Q1 2026 compared to 4.1 last year.

In Serviced Apartments: The length of stay increased by 1.2 percent, reaching 2.2 nights compared to 2.1 in the same quarter of 2025.

These aggregated data, which were compiled by the General Authority for Statistics using administrative records and secondary data, reflect an important phase of structural transformation in the Kingdom's tourism sector as it strives for operational solvency and relies on long-term, quality investments.


Saudi Arabia’s Non-oil Private Sector Grows in June, New Orders at Four-month High

General view of the Saudi capital Riyadh (AFP)
General view of the Saudi capital Riyadh (AFP)
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Saudi Arabia’s Non-oil Private Sector Grows in June, New Orders at Four-month High

General view of the Saudi capital Riyadh (AFP)
General view of the Saudi capital Riyadh (AFP)

The latest Riyad Bank Purchasing Managers' Index (PMI), released on Sunday, showed that growth in Saudi Arabia's non-oil private sector accelerated markedly at the end of the second quarter.

The improvement was driven by the strongest increase in new orders and new business in four months, helping business activity regain strong momentum despite continued challenges from weak export demand and mounting inflationary pressures.

The seasonally adjusted headline index rose to 53.3 in June from 52.8 in May, remaining above the 50.0 threshold that separates growth from contraction and signaling a solid improvement in overall operating conditions and the domestic business environment.

Domestic demand rebounds

The report attributed the latest upturn to stronger inflows of new business and higher domestic spending, supported by companies securing approvals for new projects and the resumption of previously delayed sales activity as concerns over regional tensions eased. This helped bolster confidence among both investors and consumers across the kingdom.

The data showed sustained growth in output, with around 18% of surveyed firms reporting higher activity levels, while only 2% recorded a decline in output during June.

Commenting on the survey, Riyad Bank Chief Economist Naif Alghaith said: "Strong output growth, alongside the fastest increase in new orders in four months, indicates that business activity regained positive momentum at the end of the second quarter. These results once again demonstrate the resilience of the domestic economy and the non-oil sector's ability to provide a solid foundation for the kingdom's broader economic growth."

Alghaith added, highlighting companies' operating strategies: "Operationally, firms maintained strict discipline, with employment levels broadly unchanged, while backlogs of work declined for the first time in a year. This suggests companies were able to absorb rising workloads without creating capacity constraints, while prioritizing operational efficiency and measured expansion."

Exports weaken

On the other hand, the report said the rebound in the domestic market contrasted with export performance, as new orders from overseas clients declined for a fourth consecutive month, weighed down by regional logistical disruptions and intensifying competition in external markets.

Price pressures also remained the biggest challenge facing businesses. Input costs recorded their strongest quarterly increase in 15 years, driven by higher fuel, freight and wage costs. The sustained cost pressures prompted around 22% of surveyed firms to raise prices for their goods and services, resulting in the second-fastest increase in output charges in nearly six years.

Alghaith commented on how firms are managing these challenges, saying: "Despite continued cost pressures, companies appear able to manage them prudently without materially affecting overall optimism or the level of activity. This in turn reflects the underlying resilience of businesses and their strong ability to strike a careful balance between maintaining profitability and pursuing sustainable expansion in the market."


Kuwait’s Non-Oil Business Activity Contracts amid Regional Tensions

The "Al-Riqqa" oil tanker sails in the Arabian Gulf waters, off the coast of  Kuwait City on June 27, 2026. (AFP)
The "Al-Riqqa" oil tanker sails in the Arabian Gulf waters, off the coast of Kuwait City on June 27, 2026. (AFP)
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Kuwait’s Non-Oil Business Activity Contracts amid Regional Tensions

The "Al-Riqqa" oil tanker sails in the Arabian Gulf waters, off the coast of  Kuwait City on June 27, 2026. (AFP)
The "Al-Riqqa" oil tanker sails in the Arabian Gulf waters, off the coast of Kuwait City on June 27, 2026. (AFP)

Kuwait’s non-oil private sector came under renewed pressure in June, as regional tensions and rising prices weighed on demand. The result was a sharper contraction in both business activity and new orders.

The latest Purchasing Managers' Index (PMI) reading, released Sunday by S&P Global, showed a clear decline in operational and employment levels as the first half of the current year concluded.

Kuwait’s headline PMI declined to 46.4 in June, down from 47.2 in May. The index remained below the neutral 50-point threshold for the fourth consecutive month, signaling a continued and marked deterioration in business conditions across the non-oil private sector.

Participating companies attributed the decline in new orders mainly to a smaller customer base and greater caution among buyers in response to rising prices.

The weakness was not confined to the domestic market. External demand also came under significant pressure, with regional conflict and border-related issues with Iraq contributing to a sharp fall in new export orders.

Excluding the complete lockdown period during the COVID-19 pandemic in April 2020, new business from abroad registered its sharpest decline in June since the study began in September 2018.

Analyzing Kuwait's economic landscape, Andrew Harker, Economics Director at S&P Global Market Intelligence, said that companies in Kuwait continued to feel the impact of regional tensions throughout June, despite some recent positive signs that the conflict could move toward resolution.

Higher prices and intense competition for scarce new orders, especially from abroad, are currently curbing growth opportunities and leaving businesses in a position of retrenchment, he added.

Looking ahead to the second half of the year, he said businesses hope that the signing of the memorandum of understanding to cease hostilities between the US and Iran will help create a more stable market environment and improve overall business conditions.

Within Kuwait, weaker output prompted companies to reduce staffing levels for the fourth consecutive month, at a pace broadly in line with the decline recorded in May.

Lower workloads also led firms to scale back input purchasing sharply. The contraction was the fastest since April 2020, while inventories fell at the quickest rate since the series began.

At the same time, companies continued to face rising operating costs, including higher expenses for electricity, marketing, and transportation.

To protect profitability and offset these pressures, firms again raised the selling prices of their products and services. As a result, output price inflation accelerated to its fastest pace since September 2021, reaching its highest level in nearly five years.