By: Abdullah Saeed Al Habsi
How Do Maritime Risks Affect Trade Before Losses Occur?
A ship does not need to stop or a shipping lane to close for maritime risks to start affecting the economy. In the world of international trade, it is sometimes enough for an unclear risk to appear for companies to start reassessing their figures, delivery dates to become questionable, and new possibilities to enter transport, insurance, and supply decisions.
This is where the significance lies of the incident involving the Qatari liquefied natural gas carrier Al Mayeda on the evening of October 30 while sailing in the Arabian Gulf. QatarEnergy LNG-chartered or owned operator Nakilat announced that the vessel had encountered unknown objects, confirming the safety of the crew, the absence of any environmental impact, and that the carrier remained in a safe position and capable of operating. The Qatari Ministry of Foreign Affairs later announced the launch of an investigation to understand the circumstances of the incident and determine those responsible.
These are the announced facts, and they should not be burdened with what investigations have not proven. This information contains no evidence of a halt to gas supplies or a widespread disruption in trade movement resulting from the incident itself.
Yet the vessel’s continued ability to operate does not erase the most important economic question: Do our commercial institutions possess the ability to deal with risks that appear suddenly in maritime corridors?
The Connection Between the Arab Economy and Maritime Corridors
The Arab economy is tied to the sea in a way that goes beyond oil and gas exports. There are factories waiting for raw materials, markets relying on the arrival of goods, ports managing the movement of cargo, and transport companies bound by schedules, contracts, and costs that cannot always tolerate delays.
A consumer may view the arrival of a good as routine, but they do not see the decisions made beforehand between the exporter, carrier, port, and importer. The more complex these decisions become, the greater the importance of preparing for any potential disruption.
Risk Management Between Plans and Practical Decisions
The problem is that risk management in some institutions is treated as an administrative activity separate from daily work. Plans are put in files and meetings are held to discuss them, while practical decisions remain unclear for those who will need them when an unexpected event occurs.
Who is responsible for communicating with the supplier? Who decides to reroute a shipment or adjust a delivery schedule? When does a security warning become grounds for taking commercial action? Can the responsible employee obtain a quick decision, or will they find themselves facing a long chain of approvals?
These seemingly minor details may be the difference between an institution that absorbs disruption and one that multiplies its effects upon itself.
Diversifying Suppliers Is Not Enough Without Testing Alternatives
It is not enough for companies to take comfort in the presence of more than one supplier or shipping company. Diversifying sources is important, but it does not guarantee the ability to use alternatives at the right time. An alternative supplier may exist, but contracting with them takes time. Another transport means may be available, but it does not suit the nature of the goods or production schedules.
That is why institutions should move from merely counting alternatives to testing whether they can actually be used.
Arab Cooperation to Enhance Maritime Readiness
The public and private sectors in Arab countries can enhance this readiness through joint drills that bring together ports, transport companies, importers, and entities concerned with security and safety. The goal is not to assume a disaster occurs every time, but rather to see whether communication channels, authorities, and procedures are able to function under pressure.
Accurate Information Is Part of Protecting the Economy
Accurate information remains an essential part of protecting the economy. A rumor may push a company to make a costly decision that facts do not justify, just as a delay in announcing confirmed information may deprive another company of the opportunity to prepare.
Markets have the right to know what has been proven, what is still under investigation, and whether there is a real operational impact that requires intervention.
Preparing for Risks Before They Turn Into Losses
The incident involving the carrier Al Mayeda does not in itself prove that an economic crisis has occurred, but it reminds us of a fact worthy of attention: trade is not affected by direct losses alone, but by the ability of institutions to deal with possibilities before they turn into problems.
A strong economy is not merely one that continues to work under normal conditions, but one that knows how to maintain the regularity of its operations when conditions become less clear.
About the Author
Abdullah Saeed Al Habsi, MIoL
Member of the Institute of Leadership (UK)
Writer and researcher specializing in leadership, security, heritage, risk management, and operations rooms
A.S. Alhebsi
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