Protecting trade in contested waters
The Memorandum | No. 26.2024
Over the past year, sustained targeting of commercial shipping in the Red Sea – a vital maritime corridor – has shattered the illusion of safe and timely sea transport. The continued detention of the MV Galaxy Leader and its crew by Houthi forces, following their seizure over a year ago, is a stark reminder of the inability of free and open countries to resolve the crisis. The failure to establish the level of sea control needed to secure trade raises important questions as to the effectiveness of naval protection, future approaches, and most importantly, how navies that are already stretched thin, ought to balance preparing for peer conflict with safeguarding shipping.
For too long we have assumed sea transport to be dependable, stable, and efficient. The confidence in, and dominance of, established shipping routes has reinforced this belief. This has resulted in a lack of urgency to address vulnerabilities and limited opportunities for navies to test one of their fundamental purposes – protecting seagoing trade.
In November 2023, the Houthis launched their campaign against commercial shipping in the Red Sea. While they have targeted many ships, few have been struck. But in the absence of necessary levels of protection, many shipping companies have diverted their vessels around the Cape of Good Hope to keep their ships – and their crews – safe.
With freedom of navigation increasingly contested, the use of both crude and advanced anti-ship weapons from the land has dramatically reshaped the security landscape in vital trade routes.
When piracy represented the key danger in the area, the threat could largely be overcome by placing armed security guards on vessels, but commercial vessels are not equipped to defend against the weapons used by the Houthis. Introducing weapons systems to enhance defences is not a feasible option for several reasons, including: competence concerns; the safety standards corresponding to a civilian workplace; and questions regarding who should bear the costs of implementing and maintaining these systems.
The market seems to have adjusted to the new reality. To date, the shipping sector has been relatively unaffected due to limited tonnage and increased demand – a scarcity of capacity which is driving up rates and prompting many customers to secure long-term charters.
As a result, it may seem these attacks have had a trivial economic impact. But this is not entirely the case. Allied warships have been able to keep the route partly open; many ships do still transit the area successfully, which has blunted the economic impact. The number of ships passing through the Suez Canal and Bab el-Mandeb is down by around 60%, a significant hit, but not total closure. Various other macroeconomic factors, particularly the global economy stabilising after the demand spike which followed the end of the Covid-19 pandemic, have further masked negative impacts. In the United Kingdom (UK), for example, inflation continued to fall after attacks began, but the rate at which it fell was significantly reduced and it is now once more on the rise.
More broadly, the inability to keep a greater flow of trade safely moving in the region sets a concerning precedent for other actors with nefarious intentions. Having seen the relative ease with which the Houthis have been able to disrupt shipping for a prolonged period, other state or non-state actors could consider how they might benefit from a similar strategy. If that were to happen, rerouting shipping has not solved the problem, only moved it, as new routes will require protection in the future.
There are those who assume maritime stability is inherent because the free movement of ships is economically vital to so many parties. Yet maritime stability exists only where states have been willing to work hard to achieve it; there is nothing inherent about it.
Several decades of relative global maritime stability is not the ‘natural way of things’, but the result of UK and allied naval superiority – now under a concerted challenge by the ‘CRINK’.
Three multinational military missions – Prosperity Guardian, Aspides, and Poseidon Archer – were launched in response to the Houthi attacks. Guardian and Aspides focus on defensive measures to ensure freedom of navigation, while Poseidon Archer targets Houthi forces in Yemen. Prosperity Guardian aims to generate stability through presence and patrols, while Aspides focuses on close escorts to high-risk vessels (having provided 305 to date). Initial assessments called for ten naval vessels, but Aspides has never had more than three at its disposal. Though under-resourced, limited action sends a better message than inaction. Ship availability and costs of countering cheaper threats, however, raise concerns about mission sustainability.
Targeting civilian shipping as a tool of war ‘is nearly as old as shipping itself’. Navies must recognise that, in any peer conflict, the protection of supply lines will be vital. Russia has modernised its fleet, the People’s Republic of China (PRC) has undergone a monumental naval buildup, and a number of states have expanded their shore-based firepower. In this reality, navies must balance the need to protect shipping in ‘peacetime’ conditions with deterring peer conflict. Managing this overstretch as effectively as possible will be vital.
The obvious solution is more hulls, but this requires time and money. And, while investing in larger fleets is the optimal solution, it is not the only one.
12 months on, international efforts have failed to reassure many shipping companies to resume transits. As such, new approaches should be considered. While naval forces and their tactics remain essential, closer collaboration and coordination with commercial shipping is necessary to minimise disruption in key maritime flashpoints. Several approaches could be explored to reduce risks.
To begin with, until available naval forces increase, more efficient protection methods should be pursued. Close escorts seem to have been more effective than general patrols – most vessels hit by the Houthis were too far from friendly warships. Coordinating well-protected convoys of ships, particularly those carrying high-value cargo, should become the standard approach. This requires a deeper understanding of the trade landscape and its vulnerabilities to prioritise protection. Shippers must also be transparent about their purpose, route, and cargo. Targeted protection reduces risks and provides an inducement to shift flag state: to be flagged with a free and open naval power should confer better protection.
Next, by enhancing communications systems and sharing timely intelligence, coordinated responses could be activated locally to alleviate pressures on naval and commercial capacity. Provided that there is mutual trust, navies could provide real-time threat assessments and shipping companies could offer vessel movement data for more effective deployment of limited resources. As the Houthis become more sophisticated in locating vessels, this should include guidance on the use of Automatic Identification System (AIS) in the area, as current advice to industry varies considerably .
Finally, joint exercises, training, and coordinating resources between navies and shipping companies would enable a more coordinated response. By involving commercial stakeholders in the planning stage, there can be greater understanding of each other's needs and challenges. There has been successful collaboration between navies and shipping companies in anti-piracy exercises. A similar approach could be adapted and coordinated to address threats as those posed by the Houthis.
In sum, the Red Sea Crisis serves as a stark reminder of the vulnerabilities facing global trade and the shortcomings of current strategies aimed at ensuring safe passage in vital waterways. Having assumed for too long that the maritime environment is inherently stable, free and open countries need to rethink urgently the way navies work together with commercial shipping. This will need to happen within a wider effort to restore European naval power, where navies are allocated sufficient resources to deliver the measures necessary to safeguard trade.
Allowing the situation to persist undermines efforts to deter future attempts at disrupting freedom of navigation. Ultimately, it is up to navies to guarantee safe passage of trade. Any attempts to transfer responsibility onto the commercial sector risks resulting in a glaring failure in fulfilling one of the key tasks of defence.
William Freer is a Research Fellow in National Security at the Council on Geostrategy.
Charlotte Kleberg is an Associate Fellow at the Council on Geostrategy.
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It also illustrates why warships need land attack capabilities.