Against the backdrop of endless Russian embargoes, Moldovan exports of fruit and vegetables have increasingly turned to the European market in recent years, encouraged by a 2022 decision by the European Union to increase duty-free export quotas. However, due to the stiff competition on the European market, but also due to the war in Ukraine, many Moldovan entrepreneurs have sought to make the leap to the Middle East. Now, due to a new conflict – attacks by Yemen’s Houthi group in the Red Sea – Moldovan exporters are again affected, IPN reports with reference to RFE/RL’s Moldovan Service.
Ion Tulei, a fruit grower from Olanesti village of Stefan Voda district, exported the first batch of apples to India in the autumn of 2022, after Russia’s full-scale invasion of Ukraine increased the cost of export to the CIS. Also, he had already been exporting to the UAE for five years. At the beginning of February 2024, shipping companies informed him that the transportation fees had doubled because cargo ships no longer cross the Red Sea on their direct way to the Emirates or India, but instead make a detour of several weeks around Africa.
The Houthi attacks on merchant ships in the Red Sea, which began in November and intensified in December and January, prompted carriers to opt for the bypass route.
The Ministry of Economic Development and Digitalization in Chisinau told the Service that “political instability and the armed conflicts in the region can create risks for the business community and exporters as a whole, including those in Moldova.”
Ion Tulei, who grows fruit on an area of over 100 hectares in Olanesti, said that he just got used to the Middle East market, which he saw as a prospect. “The most important markets there remain Dubai and Saudi Arabia. Now, due to the crisis in the Red Sea, we were asked to pay an additional transportation fee of $2,100 (compared to $1,070 before the crisis). The shipping lines announced that they would avoid the Red Sea. This means that the transit period extends from 14 to 45 days,” said Tulei.
“Everything has become more difficult,” Moldova Fruct Association executive director Iurie Fală told the Service, adding that “not only prices, but also risks” are growing. The Association, which represents the interests of a number of fruit exporters, calculated that, on average, the price for transportation to the Middle East and Southeast Asia increased from $1,600 to $2,000, and the journey lengthened by about two weeks.
Until the Houthi attacks, however, there was a clear upward trend. The data provided by the Ministry of Economic Development to RFE/RL’s Moldova Service show that in 11 months of 2023, trade with the Red Sea countries and the United Arab Emirates constituted 1.3% on export and 1.2% on import, as against 0.8% on export and 0.6% on import in 11 months of 2022.
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