How is China undermining the US without employing any military force?
Currently, the Red Sea region faces a substantial security challenge due to the proliferation of piratical assaults on international maritime traffic by Yemen-based Houthi insurgents. In response to escalating missile and drone strikes on commercial and US naval ships, a coalition led by the US and UK initiated joint strikes on Houthi military targets in Yemen on January 9th.
However, this disruption is significant because around 12% of global shipping traffic goes through the Red Sea and the Suez Canal. Consequently, major shipping lines worldwide have been compelled to suspend operations through these vital maritime routes. A series of attacks on commercial ships in the Red Sea has occurred since the Israel-Hamas conflict began on October 7th.
Iranian-backed Houthi militants who control parts of Yemen have utilized an arsenal of advanced weaponry including ballistic missiles and kamikaze drones in their assaults against international shipping within the Red Sea. These actions support Palestinian militant group Hamas. On November 21st, Galaxy Leader and its Israeli cargo ship traveling from Turkey to India was seized by Yemen’s Houthi rebels who are aligned with Iran.
The attacks continued with three commercial vessels being targeted by Houthi drones and missiles on December 3rd; since then, another twenty-nine ships have been attacked in that area with thirteen suffering direct strikes from missiles or drones. The rebels also declared that all ships associated with Israel are fair targets but they won’t target Chinese or Russian ships unless they’re linked to Israel.
China’s stake in the Red Sea is significant as it is currently world’s largest trading nation; therefore these attacks still affect China’s economic interests — for example China’s largest Shipping Company Costco has stopped shipping to Israel because of security concerns — moreover as Europe stands as China’s primary trading partner (with over sixty percent trade value typically passing through Suez canal), disruptions along this route prompts cargo vessels taking longer detours around Africa’s Cape Of Good Hope adding up two weeks travel time substantially increasing shipping costs while longer routes could raise import prices potentially fueling inflation in China.
Shipping costs from Shanghai to Genoa surged by 464% in just two months, along with insurance rates due to increased attacks on Red Sea shipping. Chinese companies, including Costco, have made significant investments in the region. This crisis poses a serious risk to China’s economy, which is already facing challenges in terms of growth. The US faces political, economic, and strategic challenges as it aims to maintain stability and security in its strategic relationships. The situation also underscores the importance of a robust Chinese navy, validating previous strategic decisions such as establishing a military base in Djibouti. India’s near-term export targets are under threat due to global upheavals and uncertainties fallout from the Ukraine-Russia war and Red Sea crisis. This could impact India’s financial goals in the coming years.
