Concern and reflection are overwhelming exporters as they try to map out a plan of action if the war turmoil in the Middle East drags on for a long time.
In the middle of a flare-up, with Israel and Iran at war, the clouds are thickening for export businesses drawing up alternative route scenarios, at a time when no one is able to map the scope of the impact on the economy should the two sides… pull the trigger.
In this context, a difficult struggle to maintain shares and profits in the international markets, in the midst of intensifying and prolonged geopolitical instability with war fronts springing up one after the other, is given by Greek exporters who are called to respond to an increasingly demanding environment of relentless competition .
At the same time, however, they are targeting new export destinations.
The quicksand environment in which exporters are trying to ensure the competitiveness of their products, at a time when inflation and price appreciation are on the rise, is clouding the export horizon.
With exports, excluding oil, stifling since the beginning of the year a new war front will put a suffocating pressure on businesses, the economy and consumers, throwing into doubt the targets for GDP growth in 2024, directly threatening and igniting the accuracy.
“Everything will depend on the duration of the instability”
“The instability prevailing worldwide is certainly not good news, in fact Greek exporters are called upon to develop in new markets. The situation in the Middle East if sustained for long will add to the already high costs of doing business due to the situation with the Houthis and due to the pre-existing Israeli-Palestinian war.
If the situation on the Israel-Iran front does not calm down soon, new increases will be added to the already increased business costs due to the Suez bypass and will inevitably be passed on to the products that consumers buy, but everything will depend on how long the uncertainty lasts.
In any case, the expansion into new markets must be our priority”, notes the president of the Panhellenic Exporters’ Association (PSE), Alkiviadis Kalambokis, to the “Economic Post”.
The Houthis… tripled the cost of the containers
For Greek companies, before normality is even pulled out of the Israel-Iran axis, the abandonment of one of the most common global shipping routes from Asia to Europe (due to the threat of the Houthis), causes, among other things: An increase in transport costs (a container from Asia to Europe reaches 7,000 euros) and transportation time (3,300 nautical miles longer journey, 2 to 4 weeks longer), delay in delivery time (at least 20 days, especially for Eastern Mediterranean ports), increase in insurance premiums and the cost of raw materials, disruptions to ship schedules (dates – supply locations) and delivery times, stress on products and increased risk of damage to them, as well as employment impacts.
According to estimates by market players, since the outbreak of the crisis with the Houthis, the cost of transporting a container from Asia to Piraeus has almost tripled, from 2,000 to 6-7,000 euros.
Exports are struggling hard in an adverse environment
It is worth noting that June 2024 also closed with increased exports compared to last June, according to the provisional data announced by ELSTAT and processed by the IEES of SEBE. More specifically, these reached €4,256.7 million compared to €4,168.9 million in June 2023, with an increase of €87.8 million, i.e. 2.1%.
At the same time, imports decreased by €169.3 million (i.e. 2.5%) reaching €6,610.3 million. As a result of the above, the trade deficit decreased by €257.1 million (i.e. 9.8% ) and its formation in €2,353.6 million.
Excluding petroleum products, exports appear reduced by €231.8 million (i.e. 7.3%) with their final value reaching €2,946.7 million, while at the same time imports also decrease by 2.6% with their final value to be €5,131.7 million. The trade deficit in this case increases compared to June 2023 by €92.8 million (ie 4.4%) and amounts to €2,185.0 million.
Food – drinks pull the cart
At the sectoral level, the consistently positive course of food and beverages-tobacco continues, with increases in both sectors as well as in that of petroleum products and unclassified. More specifically, the food sector showed a 7.7% increase, reaching €4,150.7 million throughout the January-June 2024 period, while the beverage-tobacco sector reached €689.7 million, with an increase of 4. 9%.
That of unclassified products showed an increase of 287.5%, reaching €271.6 million, while the smallest increase was shown by the oil products sector, however, taking the first place in the export sector for the period January-June 2024 with an increase of 0.6% compared to the same period of 2023 and reaching €7,944.0 million.
A decrease is observed in all other sectors with a downward trend in exports in the industrial sector (€3,538.8 million, i.e. 12.6%), chemicals (€3,133.3 million, i.e. 3.3%), machinery and vehicles (€2,425.4 million, i.e. 8.0%), various industrial (€1,740.7 million, i.e. 4.7%), raw materials (€869.0 million, i.e. 3.9 %), fats and oils (€534.9 million, i.e. 44.7%).
SOURCE: ot.gr
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