Israel’s Trade and Prices Unaffected by Houthi Attacks, Says Finance Ministry

The Israeli Finance Ministry has issued a report on Monday, stating that the attacks by Yemen’s Houthi rebels on cargo ships in the Red Sea have had little impact on Israel’s trade and prices. The report comes amid the ongoing war between Israel and Hamas in Gaza, which has also raised concerns about the regional stability and security.

The Houthi rebels, who are backed by Iran and control most of Yemen, have launched several attacks on international commercial shipping in the Red Sea since mid-November, claiming that they are acting in solidarity with the Palestinians against Israel’s aggression in Gaza. The attacks have targeted ships linked to Israel, the US, and Britain, as well as ships carrying oil and humanitarian aid.

The Houthi attacks have disrupted the global shipping industry, forcing some companies to reroute their vessels to longer and more expensive routes around southern Africa. The attacks have also increased the risk of a wider conflict in the region, as the US and Britain have responded by striking Houthi targets in Yemen in retaliation.

The Israeli Response and Assessment

The Israeli government has condemned the Houthi attacks as a terrorist act and a threat to the international trade and peace. Israel has also increased its security and surveillance measures in the Red Sea, as well as its coordination and cooperation with its allies and partners.

The Israeli Finance Ministry has conducted an analysis of the potential effects of the Houthi attacks on Israel’s trade and prices, and concluded that they are limited and manageable. The ministry said that the cost of sea transport accounts for only 3% of the total value of imports, and that imports represent only 20% of private spending. Therefore, the increase in sea freight costs would have a negligible impact on the consumer price index (CPI), which is currently at a low level of 2.6%.

The ministry also said that there have been no significant disruptions in the supply chain, and that the commodity and energy prices have been largely stable. The ministry added that the inflation expectations for the coming year have remained unchanged, and that the economic growth and recovery prospects have not been affected.

The Regional and International Implications

The Houthi attacks on shipping in the Red Sea have not only domestic but also regional and international implications, as they reflect the complex and volatile situation in the Middle East and North Africa. The attacks also pose several challenges and opportunities for the involved parties and the international community.

  • For the Houthis, the attacks are a way of asserting their power and influence in the region, as well as of expressing their solidarity and support for the Palestinians. The attacks are also a means of defying and provoking their enemies, such as Saudi Arabia, the US, and Israel, who have been waging a war against them for years.
  • For Israel, the attacks are a source of concern and pressure, as they add another dimension to the war with Hamas and the regional instability. The attacks are also a reminder of the Iranian threat and influence in the region, as Iran is the main sponsor and ally of the Houthis.
  • For the US and Britain, the attacks are a challenge and a responsibility, as they have to protect their interests and allies in the region, as well as to maintain the freedom and security of navigation in the Red Sea. The attacks are also an opportunity and a motivation, as they have to engage and cooperate with the regional actors and the international community to find a diplomatic and peaceful solution to the conflict.

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