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The Israel-Hamas war could raise prices in Macao

It’s already having a major impact on global trade, causing cargo ships to make expensive detours to avoid the Suez Canal. That doesn’t bode well for Macao’s European imports.

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UPDATED: 10 Jan 2024, 11:23 am

The director of the Macau International Logistics and Forwarding Association, Lei Kuok Fai, has told media that the increasing costs of bringing European goods to Macao will likely be transferred to consumers.

Tensions in the Israel-Hamas war are impacting global trade, as cargo ships traversing the Red Sea are being attacked by Iran-backed Houthi rebels in response to Israel’s continuing bombardment of Palestinians in Gaza. 

The Israel-Hamas war attacks have seriously disrupted supply chains, sparking expensive and lengthy detours around Africa’s southern tip to avoid Egypt’s Suez Canal. Connecting the Red Sea to the Mediterranean, the canal is the most direct maritime route between Asia and Europe.

[See more: Zhuhai’s logistics park offers up to 5 million yuan in subsidies]

Lei told Ponto Final that most essential goods sold in Macao come from mainland China and other parts of Asia, with the conflict having only minimal impact on their prices.

However “medium and high-end products,” such as designer clothing and luxury food, often came from Europe. Those were where delays and price hikes would be felt first, he told the paper.

Lei noted that the global logistics industry also faced headwinds from the ongoing conflict between Russia and Ukraine, which would “continue to affect the freight transport sector this year.”

UPDATED: 10 Jan 2024, 11:23 am

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