&w=3840&q=100)
Has China cut a deal with Houthis? Its car cargo sailing through Red Sea, others still taking a detour
Advertisement
(File) USS Carter Hall and amphibious assault ship USS Bataan transit the Bab al-Mandeb strait. AP/Representational image
Unlike other cargo ships, China is shipping its automobiles to parts of the world via the Red Sea and the Suez Canal, even amid the Iran-backed Houthi group's continued aggression in the region that has forced merchant vessels from other countries to take a different route.
An analysis by Lloyd's List Intelligence, a British maritime information service, has said that at least 14 car-carrier ships passed through the Red Sea and Suez Canal from China to ports across Europe last month.
STORY CONTINUES BELOW THIS AD
The voyage occurred despite Houthis using drones, grenades and gunfire to sink two cargo ships last month. The terror group says that its attacks are motivated by solidarity with Gazans in Palestine.
Why is China getting special treatment?
Shipping analysts believe that the Chinese government has reached an understanding with the Houthis or Iran not to harm car-carrier ships from China.
Daniel Nash, associate director of valuation and analytics at Veson Nautical, told the New York Times, 'China has found a way to deal with the Iran-backed Houthi rebels, and they have been told that their ships will not be targeted.'
Travelling through the Red Sea and Suez Canal saves 14 to 18 days on each round trip between Asia and Europe, compared to the longer route around Africa. This shorter passage cuts down on fuel, crew expenses, and overall shipping costs by several hundred dollars per car.
What are the other routes?
Houthi rebels in Yemen, seeking to stop Israel's offensive against Hamas in Gaza, are attacking cargo ships plying the waters connecting Asia with Europe and the United States, forcing traffic away from the Suez Canal and around the tip of Africa. The disruption is causing delays and driving up costs, at a time when the world has yet to vanquish a resurgence of inflation.
Escalating Houthi threats have triggered rerouting of global shipping via the Cape of Good Hope, with far-reaching consequences, from elevated freight and insurance costs to extended delivery times, emissions spikes, humanitarian delays, and regional port shutdowns. Governments and shipping firms are responding with naval protection, international coordination, and structural adaptations to safeguard vital trade routes.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
News18
an hour ago
- News18
US national debt reaches a record USD37 trillion, Treasury Department reports
Last Updated: Washington, Aug 12 (AP) The US government's gross national debt has surpassed USD37 trillion, a record number that highlights the accelerating debt on America's balance sheet and increased cost pressures on taxpayers. The USD37 trillion update is found in the latest Treasury Department report issued Tuesday which logs the nation's daily finances. The national debt eclipsed USD37 trillion years sooner than pre-pandemic projections. The Congressional Budget Office's January 2020 projections had gross federal debt eclipsing USD37 trillion after fiscal year 2030. But the debt grew faster than expected because of a multi-year COVID-19 pandemic starting in 2020 that shut down much of the U.S. economy, where the federal government borrowed heavily under then-President Donald Trump and former President Joe Biden to stabilise the national economy and support a recovery. And now, more government spending has been approved after Trump signed into law Republicans' tax cut and spending legislation earlier this year. The law set to add USD4.1 trillion to the national debt over the next decade, according to Congressional Budget Office estimates. Chair and CEO of the Peter G. Peterson Foundation, Michael Peterson said in a statement that government borrowing puts upward pressure on interest rates, 'adding costs for everyone and reducing private sector investment. Within the federal budget, the debt crowds out important priorities and creates a damaging cycle of more borrowing, more interest costs, and even more borrowing." Wendy Edelberg, a senior fellow in Economic Studies at the Brookings Institution said Congress has a major role in setting in motion spending and revenue policy and the result of the Republicans' tax law 'means that we're going to borrow a lot over the course of 2026, we're going to borrow a lot over the course of 2027, and it's just going to keep going." The Government Accountability Office outlines some of the impacts of rising government debt on Americans – including higher borrowing costs for things like mortgages and cars, lower wages from businesses having less money available to invest, and more expensive goods and services. Peterson points out how the trillion-dollar milestones are 'piling up at a rapid rate." The US hit USD34 trillion in debt in January 2024, USD35 trillion in July 2024 and USD36 trillion in November 2024. 'We are now adding a trillion more to the national debt every 5 months," Peterson said. 'That's more than twice as fast as the average rate over the last 25 years." The Joint Economic Committee estimates at the current average daily rate of growth an increase of another trillion dollars to the debt would be reached in approximately 173 days. Maya MacGuineas, president of the Committee for a Responsible Federal Budget said in a statement that 'hopefully this milestone is enough to wake up policymakers to the reality that we need to do something, and we need to do it quickly." (AP) RHL RHL view comments First Published: August 13, 2025, 03:15 IST Disclaimer: Comments reflect users' views, not News18's. Please keep discussions respectful and constructive. Abusive, defamatory, or illegal comments will be removed. News18 may disable any comment at its discretion. By posting, you agree to our Terms of Use and Privacy Policy.
Hindustan Times
2 hours ago
- Hindustan Times
US sanctions Congo militia tied to forced labour, smuggling in key mining zone
The US government on Tuesday sanctioned an armed group accused of illicit trading in minerals in eastern Congo as Washington tries to spearhead peace efforts there while pushing for US access to the region's minerals. The US is also sanctioning the Congolese mining company CDMC, saying it sold minerals which were sourced and smuggled from mines near Rubaya.(Representational Image/AP) A senior US government official who spoke on condition of anonymity ahead of the formal announcement said the State and Treasury departments are sanctioning the CODECO armed group, which controlled the key coltan mining site of Rubaya from 2022 to early 2024. 'During this period, CODECO generated revenue by overseeing mining operations, collecting illegal fees and taxes for miners and engaging in mineral smuggling. It also imposed forced labour and executed civilians in mining areas under its control,' the official said in Washington. The US is also sanctioning the Congolese mining company CDMC, saying it sold minerals which were sourced and smuggled from mines near Rubaya, and two Hong Kong exporters, East Rise and Star Dragon, that purchased minerals from the mining area. The State Department said it is freezing the assets of the armed group and companies in the US or under US control and banning all transactions with them. Rubaya is currently under the control of the M23 rebel group, which is already targeted by US sanctions. The mining site lies in the heart of eastern Congo, a mineral-rich part of the Central African nation, which for decades has been ripped apart by violence from government forces and different armed groups, including the Rwanda-backed M23, whose recent resurgence has escalated the conflict, worsening an already acute humanitarian crisis. In June, Congo and Rwanda signed a peace deal facilitated by the US to help end the conflict while helping the US government and American companies gain access to critical minerals in the region. Congo and the M23 rebels have also agreed to sign a permanent peace deal by August 18, but renewed fighting has threatened this effort. On Tuesday, Congo and M23 both accused each other of violating the agreement by attacking each other's forces.
Time of India
2 hours ago
- Time of India
Houthis spare Chinese car ships, but others aren't so lucky - here's the surprising reason
Since the end of 2023, commercial vessels transiting through the Red Sea have been constantly threatened as the Houthi militia in Yemen started attacking ships in what they referred to as an act of solidarity with Palestinians in Gaza, as per a report. However, unexpectedly this summer, there has been a sudden exception: Chinese-made car-carrier ships are making it through unscathed, as per a Jalopnik report. Chinese Ships Mysteriously Spared from Houthi Threat As per the report, the reason driving this exception could be that China facilitated a back-channel agreement with the Houthis directly or, more probably, through Iran, which is the group's main sponsor, according to the Jalopnik report. Iran, a huge oil exporter, depends on China as its biggest customer, according to the report. That provides Beijing huge leverage, and it seems they've exercised it to discreetly shield a rising pillar of their economy, the increasing export of Chinese automobiles, as per the Jalopnik report. Finance Value and Valuation Masterclass - Batch 4 By CA Himanshu Jain View Program Artificial Intelligence AI For Business Professionals Batch 2 By Ansh Mehra View Program Finance Value and Valuation Masterclass - Batch 3 By CA Himanshu Jain View Program Artificial Intelligence AI For Business Professionals By Vaibhav Sisinity View Program Finance Value and Valuation Masterclass - Batch 2 By CA Himanshu Jain View Program Finance Value and Valuation Masterclass Batch-1 By CA Himanshu Jain View Program ALSO READ: Trump plans 600-soldier military reaction force ready to strike at a moment's notice - here's what it will do by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Top 15 Most Beautiful Women in the World Undo Not All Chinese Ships Protected, Only Car Carriers Interestingly, the deal appears to be highly specified, even a few non-Chinese vessels carrying Chinese cars have also been left untouched, according to the report. But Chinese ships that are not carrying cars still steer clear of the route altogether, which hints that the deal might be applicable only to car carriers, as per the Jalopnik report. China Ramps Up Car Exports to Europe in 2025 This move coincides with China's growing presence in the European car market, as per the rpeort. In April 2025, Chinese vehicles represented close to 5% of the market, whic almost double of what it was only a year ago, according to the Jalopnik report. Live Events The S&P Global analysts have predict that could rise to 10% by 2034, as per the report. But the journey has not been smooth as the European Union has reacted by slapping high tariffs on Chinese vehicles that are subsidized by the state, with tariffs rising as high as 35%, as reported by Jalopnik. ALSO READ: Giant Wyoming data center to guzzle 5x more power than residents, but the user remains secret Red Sea Shortcut Offers Huge Advantage to Chinese Automakers Since cheap prices are one of the main reasons for the demand of these vehicles, these companies are desperate to find ways to compensate for the tariffs, according to the report. By avoiding the Red Sea, these ships adds 14 days to 18 days to the voyage, which is a lot of additional costs for fuel, crew, and maintenance, as per Jalopnik. That would be about a few hundred dollars per car and because some of China's massive new ships can carry 5,000 cars each, the financial impact is in the millions, according to the report. If those ships can just take the shortcut via Red Sea, that would be huge savings for carmakers that they can either pocket or pass on to consumers, as reported by Jalopnik. ALSO READ: China's job crisis spurs bizarre trend: Young Chinese pay companies just to pretend they have a job — here's why FAQs Why aren't Chinese car carriers being attacked? China may have brokered a quiet deal with the Houthis or their backers, likely Iran, to protect its car exports, as per the Jalopnik report. How important is the Red Sea route for shipping? Very important, it's the fastest link between Asia and Europe. Avoiding it adds 14 to 18 days to the journey.
