Karachi, December 26, 2023: The Union of Small and Medium Enterprises (UNISAME) has raised an alarm over a significant increase in freight rates triggered by the ongoing crisis in the Red Sea and Suez Canal.
In a statement released on Tuesday, UNISAME highlighted the challenges posed by the crisis, leading to a substantial rise in freight rates that now threaten the affordability for buyers.
According to Hussain Ali, the convener of UNISAME Logistics committee, freight rates have surged by a staggering 150% to 200%. To navigate the challenges, an Operational Recovery Surcharge has been imposed for sectors covering Europe, the USA, and Africa.
Expressing concern, Ali emphasized the potential impact on exports, warning that the sharp increase in freight rates could lead to shortages in various sectors. He specifically mentioned the adverse effects on kinoo exports, citing an extended transit time of 40 to 45 days.
While the crisis has not affected the Middle East, China, and the Far East directly, there is apprehension that a war risk surcharge may be imposed. Ali highlighted the rerouting of Europe-bound cargo through the Cape of Good Hope in South Africa, resulting in an extended transit time of 40 to 45 days. This, he lamented, would pose another setback to logistics.
Zulfikar Thaver, the President of UNISAME, expressed deep concern over the situation, characterizing the Red Sea as a danger zone. He called on world leaders to urgently address and resolve the ongoing conflict between Israel and Hamas, emphasizing the need to safeguard lives, properties, and global trade.
Thaver appealed to the United Nations to intervene, invoking the principle of humanity. He underscored the urgency of preventing the massacre of innocent lives, including men, women, and children, as well as the targeting of camps and hospitals. Thaver highlighted the unconventional nature of the conflict, where unarmed civilians are at risk, urging the international community to act swiftly in the name of humanity.
