Video: Nike, the Houthis and the Red Sea - 360
Lachlan Guselli and Michael Joiner360info
Published on March 26, 2024
Even your sneakers are affected as the Yemen-based Houthi movement causes havoc to a trillion dollars worth of global trade in its attacks on ships in the Red Sea in support of Hamas fighting Israel in Gaza.
The Yemen-based Houthi movement has wrought havoc on more than a trillion dollars worth of global trade since it joined the fray in support of Hamas as it contends with Israel’s all-out assault on Palestine.
The response from outside has been fast and lethal. Militaries from all over have descended on the region to defend the trade corridor.
The United States and the United Kingdom are leading airstrikes aimed at disrupting and weakening the Houthis. India has at least a dozen warships in the region, the European Union is offering a fleet while navies from Singapore and Sri Lanka are joining the fight to defend trade.
The Suez Canal shipping route is one of the most important trading arteries in the world.
So far, the disruptions have not plunged the world into economic turmoil, but with the global order recovering from a pandemic and its economic upheaval, what impact is this having on major companies like Nike?
The global sneaker market is worth $147 billion per year, so the company that gets more than 90% of its shoes made in east Asia is left to scramble in an attempt to rediscover how it can get its goods from Asia to Europe, the Middle East and North Africa.
To get around this crisis, shipping companies are using alternate routes and have so far managed to find ways to limit price rises to moderate levels, relative to what they could have been.
However how long can this go on for, and what can be done to stop the Houthi hold over global trade without yet more bloodshed in Yemen.
Sarah Phillips and Michael Bell from the University of Sydney provide expert knowledge and insight to help tell the story.