Good morning, and welcome to the Global Situation Report for Friday, 08 December 2023.
- RABOBANK: HIGHER SHIPPING PRICES, SUPPLY SHOCKS IN 2024: Rabobank analysts reported that continued Houthi attacks on ships in the Red Sea will divert trade away from the Suez Canal and around the Cape of Good Hope, challenging an already fragile global supply chain.
- If more global shipping is diverted around Africa rather than through the Suez Canal, “delivery times are going to be extended by weeks, and ocean carrier pricing is going to rise substantially,” Rabobank wrote.
- “The Panama Canal is so cloggedup that a shipping company paid $4 million to jump the line when a year ago a [regular] slot cost $173,000,” the report added.
Why It Matters: You can increase your resilience to global supply chain problems and higher prices. First, assess your reliance on foreign manufactured goods and, if possible, bulk order these products now. Also, especially if you run a U.S. business that’s dependent on overseas manufacturing, look for alternate sources in Mexico, as this closer supply chain should be less vulnerable to delays and failures. Finally, the likely upcoming supply chain shocks will create business and investment opportunities like 3-D printing vital components. – H.B.
- PALESTINIAN AUTHORITY WORKING WITH U.S. ON GAZA PLAN: Palestinian Authority Prime Minister Mohammad Shtayyeh said he is working with U.S. officials on a plan to govern the Gaza strip after the end of the Israel-Gaza war.
- Shtayyeh added that the ideal outcome would be for Hamas to become a junior partner to the Palestinian Authority and help build an independent state that includes the West Bank, Gaza, and East Jerusalem.
Why It Matters: The outcome Shtayyeh outlines is unrealistic, that Hamas would fall under the Palestinian Authority to assist in the governance of a unified Palestinian state. Israel will never go for that arrangement, and it’s unlikely the Biden administration would agree to it either. Israel needs to reestablish a security deterrent while avoiding a regional escalation over civilian casualties, and Hamas having any hand in governing Gaza after the end of the war would undermine Israel’s security deterrent. – R.C.
- CHINA’S BALLOON OVER TAIWAN: A DEVIATION FROM THE NORM: The Taiwanese Ministry of Defense reported ten PLA Navy (PLAN) ships and 26 People’s Liberation Army (PLA) air assets, including one balloon.
- The balloon crossed over Taiwan at 21,000 feet (airlines travel at 40,000 ft, and the February Spy Balloon was recorded at 60,000 ft ), went east, and “disappeared,” according to the Ministry of Defense.
Why It Matters: This is the first balloon on record. Charting an easterly course over the Pacific does not indicate its ultimate goal. While it could make its way to the U.S., it was at an exceptionally low altitude and entering the open ocean. The previous balloon traveled over the coasts and was recorded at 60,000 feet. The United States is not likely to be the intended target. – J.V.
THAT’S A WRAP: This does it for today’s edition. Thank you for reading. If you know folks who would also like to receive this email, would you please forward it to them? We appreciate you spreading the word. – M.S.
I didn’t sign up to have to read these reports. Go back to audio reports or I’m outta here…
hey larry – we do a livestream video every day, monday through friday. are you able to log in and listen to the early warning podcast version?