New Delhi, March 17 The conflict in the Middle East has hit China’s exports due to the disruption in shipping, which has caused goods to pile up in the local warehouses, according to media reports.
The report in CBC news came from the Chinese city of Yiwu, which is known as the world’s supermarket, as it is a key supplier of household goods and electronic products to US commerce giants such as Amazon and Walmart, as well as to the Middle East.
The report by Chris Brown states that due to the sharp rise in shipping costs as well as the danger to commercial ships due to the Iran war, importers are not lifting Chinese goods, as a result of which the inventory is piling up. Shipping costs are reported to have gone up fivefold from $1,200 per container to $6,000, the report cited a local businessman as saying.
Apart from the high shipping costs, some importers do not want to take the risk of transporting goods, as it is not considered safe due to the attacks taking place on commercial shipping amid the Middle East war. Another oil tanker was hit in the Persian Gulf on Tuesday, which appears to show that their fears are well-founded.
The report points out that the city in Eastern China provides an insight into how the Iran war and the blocking of the Strait of Hormuz are disrupting global supply chains.
The report cites some local businessmen as saying that the Middle East consumes about 30 per cent of the goods exported from the Chinese city.
Apart from the exports being adversely impacted due to the war, China has also been hit on the energy front, as it is one of the biggest buyers of Iranian oil, the report points out.
Similarly, a lot of liquified natural gas (LNG) imported by China comes from Qatar. The Middle East country has shut down some operations due to air attacks on its gas facilities, and this has disrupted supplies.
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