Link:https://apnews.com/article/yemen-iran-houthi-rebels-red-sea-mokha-e4e799701b382799a955969c212800ea
The Houthis,a rebel group in Yemen who were backed by the Iranian government, have seized the Yemeni port city of Mokha. The capture is the largest territorial gain since 2022 truce in the Yemen civil war. The city of Mokha is roughly 50 miles away from the major shipping passage Bab el-Mandeb Strait, a passage which about 12% of global goods pass through. Additionally, this takeover is impacting the citizens of Mokha as some citizens are already beginning to flee the city. The Houthis have previously attacked ships in the Red Sea undoubtedly raising some concerns about the security of the ships going through the strait. As a result of these concerns, it is reported that shipping through the strait has already begun to decline.
Another major trade passage falling into uncertainty will undoubtedly have an impact on the global economy. If ships begin to feel increasingly unsafe traveling through the strait, these ships may start being rerouted. The redirection of ships will result in higher transportation costs and longer delivery times, two things that will make operating these vessels more expensive. These increased costs are almost guaranteed to be offset by making prices on goods higher which ultimately hurts the consumer the most. As the Houthi’s are Iranian backed, the capture of Mokha allows Iran to apply economic pressure to the United States, a country that Iran is currently at war with.
Yemen faces the largest immediate impact following these events as the capture of Mokha strengthens the Houthi’s position in Yemen. This expansion is beginning to become a threat to the Saudi Arabian government as they back the Yemeni government. A stronger Houthi presence by the Red Sea is unsettling to say the least as this could affect Saudi shipping though the region. Because the Houthi’s are backed by Iran, the capture of Mokha is a major win for them as well giving them an increase in their regional power. However as Iran has mostly remained in the background of the civil war, they are in a position to reap a lot of the benefits without being directly involved in the conflict.
We are able to connect this to the idea of economic interdependence as it’s often easy to forget how much of not just the United States economy but the global economy is built off of trade. The uncertainty in the Bab el-Mandeb Strait caused by the capture of the Mokha can have a knock on effect possibly leading to an increase in global prices not just prices in that region. This demonstrates the interdependence countries have on each other built through international trade.