Between Aden and Hodeidah: The Reality of Commercial Voyages

Reports

Tue, 07-03-2023 12:10 AM, Aden Time

Raad Alrimi (South24)

In Mid-February, the Iran-backed Houthi militia and Saudi media platforms announced that commercial ships began to enter the Port of Hodeidah without being seized or obstructed. This came as part of an Omani-brokered truce agreement with Riyadh.

The declaration follows measures imposed by the Houthis regarding the entry of goods coming from the Port of Aden to Northern governorates in overland customs points according to local and commercial sources who spoke to “South24 Center”. This also came concurrently with governmental decisions in Aden to increase the price of the customs dollar by 50%.

These developments raise questions and concerns about the lowering performance of the strategic Port of Aden and other South Yemen’s ports in favor of the Port of Hodeidah controlled by the Houthis. This comes amid reports about changing the path of these commercial voyages as a result of these developments.

In previous statements to “South24 Center”, the Head of the Chamber of Commerce in the capital, Aden, said that “the merchants began to import goods via the Port of Hodediah [following the facilities provided by the Coalition] because the Houthis have obstructed the import operations through the Port of Aden.

In separate statements, the Yemeni Ministry of Transport denied that the trajectory of the voyages changed towards Hodeidah. The Gulf of Aden Ports Corporation threatened to impose sanctions against the offending companies which deal with the Houthis according to documents seen by “South24 Center”.

In this report, “South24 Center” is verifying the validity of news about the decline of Aden Port’s performance in favor of the Houthis recently. We hosted the Minister of Transport in the internationally-recognized government and other figures to answer several questions.

Maritime voyages

Data issued by Marine Traffic, a website specialized in monitoring ships and boats, demonstrated a real decline in the Port of Aden's activities during January and February of this year in comparison to the same period of 2022.

According to data gathered and monitored by “South24 Center”, the Port of Aden in January and February 2022 received 82 ships carrying oil, cargo and fluid shipments while it received only 69 during the same period of 2023.

The voyages to the Port of Aden in January and February 2022 (South24 Center via Marine Traffic)

The voyages to the Port of Aden in January and February 2023 (South24 Center via Marine Traffic)

On the other hand, the number of ships that arrived at the Port of Hodeidah increased from 27 during January and February 2022 to 42 during the same period of the current year. This confirms Hodeidah’s growing activities at the expense of the Port of Aden.

The voyages to the Port of Hodeidah in January and February 2022 (South24 Center through Marine Traffic)

The maritimes voyages to the Port of Hodeidah in January and February 2023 (South24 Center through Marine Traffic)

Exclusive sources in "Aden Customs" confirmed to “South24 Center” the decreasing number of commercial shipments to the Port of Aden during past weeks, especially construction materials such as cement, paint, lime, marble, and others.

However, Minister of Transport in the internationally-legitimate government, Dr Abdulsalam Hamed, exclusively told “South24 Center” that “the ship traffic to the Port of Aden and other ports hasn't changed”, adding that news about opening the Port of Hodeidah is not true.

The minister added: “the government is engaged in full coordination with the Saudi-led Arab Coalition and the United Nations. It realizes the sensitivity of the situation and the importance of efforts made by the brothers and the international community in order to reach a long truce”.

Hamed pointed out that the government discussed “enhancing the coordination mechanisms regarding the entry of ships to the Port of Aden and the liberated ports as well as the procedures to provide all facilities to merchants and importers”.

On February 15th, a meeting between the Ministries of Transport and Industry and Commerce was held in Aden with the participation of the heads of the Chamber of Commerce and the Navigation Chamber as well as the navigation agents according to the media department of the Gulf of Aden Ports Corporation.

The ministerial meeting issued a statement stipulating that : “the Ministries of Transport and Industry and Commerce would like to alert fellow merchants that there is not any modification in the procedures related to the entry of goods to the different ports in the state including Hodeidah”.

The statement described the news claiming that the commerce and navigation companies changed their Port of Aden destination as being “rumors” which seek to circumvent laws and the agreed-upon mechanisms with the legitimate Yemeni government, the leaders of the Arab Coalitions and the UN.

The statement indicated that both ministries of Transport and Commerce are set to announce a set of measures and instructions which would rearrange organizing the commerce traffic in different ports in a way that ensures easing the arrival of goods and increases the efficiency of the transportation and delivery operation.

There has been no official declaration so far about any of these procedures. “South24 Center” contacted the leadership of the Gulf of Aden Ports Corporation to ask about the current situation of the commerce and navigation traffic in the Port of Aden. However, we have not received any answers until the moment of publishing the report.

The statement warned that “being dragged behind the Houthi militia rumors to evade the commitment of applying the active legal procedures under any pretext would be met with legal sanctions including adding the violators in the black list”.

Formal documents, seen by “South24 Center” on February 22nd,show warnings to revoke the license of 2 navigation companies and put them in the black list after they approved transporting goods to the Port of Hodeidah.

The ministry addressed “Hodeidah for Navigation and Transport” and “Al-Sharq Al-Awsat for Navigation” whose names were included in a report issued by the Houthi newspaper “26 September” along with the “Sabaa Global” and “Halal for Navigation” as being companies which violated the governmental instructions in Aden.

We could not contact the four navigation companies to answer these questions. However, exclusive sources in “Aden’s Customs" told “South24 Center” that a number of other companies began to deal with the Port of Hodeidah including “Al-Faqir for General Contracting and Infrastructure” and “Al-Yemni Group”.

On February 18th, the Houthis held a meeting in which they announced “the readiness of the Port of Hodeidah to receive all kinds of container vessels including the ports of Salif and Ras Issa".

On February 25th, the Ministry of Transport affiliated with the Houthis claimed the arrival of several ships carrying food, construction and oil products including 724 cargo containers to the Ports of Hodeidah, Salif and Ras Issa.

On February 28th, the Houthi media said that the Director of the Secretary-General of the UN Office of Special Envoy to Yemen, Roxana Bazargan, met with Transport Minister Abdulwahab Al-Durra in the Port of Hodeidah concurrently of the arrival of several ships to its docks.

In a previous report, issued by “South24 Center”, The Head of the Center for Studies and Economic Media, expert Mustafa Nasr, said: "Opening the port of Hodeidah will certainly have negative repercussions on the Port of Aden and other ports affiliated with the government, especially since the port has been opened for the entry of container vessels”.

Disastrous decision

In early January, the Yemeni Cabinet, led by PM Maeen Abdulmalik, approved measures taken by the Supreme Economic Council which is also led by Abdulmalik. This included raising the price of the customs dollars by 50% from 500 Yemeni riyals to 750 riyals.

The decision was also accompanied by a compound price hike in oil derivatives, domestic gas, water and electricity as part of what it described as “economic reforms”. Later, the ministerial bloc of STC and other Southern ministers called to reverse the decision and study it.

Although the Administrative Court in Aden decided to suspend this decision on February 6th, exclusive sources in the government and Aden Customs confirmed to “South24 Center” the ongoing implementation of it although the Houthi attempts to weaken the role of the Port of Aden.

Speaking to “South24 Center”, merchants in Aden described the decision as being “disastrous”. One merchant said the decision created a gap between the Ports of Aden and Hodeidah to play into the Houthis. This gave the latter the advantage in terms of commodity customs”.

The merchant, who demanded anonymity, said that “the ship inspection mechanism has existed in other ports before the Port of Aden. Thus, this decision makes the Port of Aden lose its huge strategic privileges. For us as merchants, this port in natural circumstances is superior to the Port of Hodeidah even if the latter is completely opened”.

The merchant indicated that the government's decision in January 2017 to decrease customs “had enhanced the Port of Aden at that time as many companies abandoned the Port of Hodeidah which is controlled by the Houthis.” He warned of the reverse scenario today.

Former Yemeni PM Bin Dagher issued a memorandum in early 2017 in which he instructed reducing the customs of fees in the Port of Aden without determining the percentage of reduction.

At an earlier time, Anis Alsharafi, Deputy Head of STC’s Foreign Affairs, criticized the decision to increase the customs dollar and the ship inspection mechanism (which takes place in the Port of Jeddah and Djibouti). He pointed to the negative repercussions on the Port of Aden.

He wrote on Twitter: “Since 2015, Southerners have demanded to move the inspection mechanism of ships entering the Yemeni ports to the Port of Aden. This included several messages and efforts made by STC leaders and the Transport Minister. However, nothing from that happened”.

Al-Sharafi blasted the decision to increase the customs dollar. He accused the government, led by Maeen Abdulmalik, of doubling the price “in a way that leads to the slump of the ports of Aden and Al-Mukalla while boosting the Port of Hodeidah and supporting the Houthi treasury”.

The price of the customs dollar in North Yemen, controlled by the Houthis, is 250 riyals while one dollar equals 548 riyals in the market. On the other hand, the price of the customs dollar in Aden is 750 riyals while each dollar equals 1220 riyals in the market.

It is worth mentioning that the Yemeni government’s decision to increase the customs dollar stipulated on exempting staple food products. However, official sources in the Central Statistical Agency told “South24 Center” that “the price hike, in light of the decision, has been extended to several basic food products”.

Sources said that a price bulletin will be issued soon which will show the percentage of the price hike of food products due to the decision. The Ministry of Industry and Commerce didn’t respond to a demand by “South24 Center” to clarify several inquiries.

In July 2021, the Yemeni government increased the price of the customs dollar by 50% from 240 riyals to 500 riyals like what happened at the beginning of this year. Although the decision included the exemption of basic foodstuffs, the prices of these items subsequently increased significantly.

Advantage

Economic expert Dr. Youssef Mohammed, downplayed the threats posed by the Port of Hodeidah on the strategic Port of Aden.

He told "South24 Center": "The Port of Hodeidah still lacks the modern giant cranes. Currently, one can't say that the Port of Hodeidah can pull the rug out from under the feet of the Port of Aden".

He added: "As for the competition between the port of Hodeidah and the port of Aden, I believe that it will be in favor of the port of Aden due to the latter's location and unloading speed. The port of Hodeidah is a closed internal port, unlike the port of Aden".

Minister Hamed told "South24 Center" that "the Ministry of Transport and the Yemeni government are not against opening the ports of Hodeidah. However, this has to be done through a truce agreement or a clear political settlement that takes into account the interests of all parties".

He added: "Then, the Yemeni legitimate government and its institutions will work to increase the competitive capabilities of maritime ports and overland crossings by improving and strengthening the commercial environment and appropriate economic activity as well as addressing deficiencies and imbalances".

He indicated that "steps have already kicked off in a way that makes ports provide their services to merchants and importers in a good and effective manner."

Despite this clear advantage, the inspection mechanism imposed on the Port of Aden in the Saudi Port of Jeddah, along with the latest decision to raise the price of the customs dollar, threaten to thwart and delay large part of the activities of Aden Port in favor of the Port of Hodeidah , especially if the latter is officially opened completely as part of any incoming deal.

The Strategic Port of Aden (Marineinsight)

Between Aden and Hodeidah: The Reality of Commercial Voyages