COPENHAGEN (dpa-AFX) - Maersk CEO Vincent Clerc issued a warning on Thursday about the ongoing disruptions to trade flows through the Red Sea. He emphasized the potential impact it can have on the global economic growth.
He further warned that it could take months to reopen the Red Sea routes, which would severely impact the global economy, traders, companies and consumers.
The CEO in comments provided to Financial Times called the closing of the Red Sea route due to attacks by Houthi militants as 'brutal' and 'dramatic'. He further added that there were no 'winners' in such a situation.
The shipping company was earlier forced to divert its vessels towards the Cape of Good Hope route from the Red Sea, which provides access to the Suez Canal. Later, it announced that it would follow the new route for the 'foreseeable future'.
Upon choosing the new route, Clerc said that it would increase the period from two to four weeks and add expenses worth hundreds of dollars per fuel container for a Europe-Asia voyage, pushing the shipping company's fuel bill 50 percent higher than earlier.
Clerc explained, 'At this time when inflation is a big issue, it's putting inflationary pressure on our costs, on our customers, and ultimately on consumers in Europe and the US'. He added that, 'In the short run, it could cause significant disruptions at the end of January, February and into March.'
Further Clerc urged to the international community to mobilize and do what it needs to do to reopen the routes.
The ships passing through the Red Sea are attacked by Yemen-based Houthi rebels, who claim it as an act against Israel's bombing of Gaza. In December, the U.S. military launched an operation to clear the route.
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