How does the dust in the "Middle East" affect "Asia"?

If the Israeli war-Hamas group continues for a long time, it will cause the price of oil to increase. The US dollar strengthened. and geopolitical instability These challenges are likely to affect the trade of various countries. in emerging markets such as India, Thailand, Philippines and Indonesia If the price of oil rises for a long period of time

Hamas-Israel group who sounded the battle drums not too long ago It is a conflict that has erupted and aggravated the current chaotic situation in which Russia is at war with Ukraine. Including tensions between two superpowers between the United States and China. that is still smoldering

Initially, economists were worried that if war Israel-Hamas group lasts a long time, it will result in an increase in oil prices. The US dollar strengthened. and geopolitical instability These challenges are likely to affect the trade of various countries. in emerging markets such as India, Thailand, Philippines and Indonesia If the price of oil rises for a long period of time

In the past 3 months Brent crude oil prices are up nearly 20% and Bloomberg Economics expects Brent crude prices may reach $150 a barrel. From the current price of around 90 USD, in case the conflict in the Middle East spreads to Iran as well.

Meanwhile, the International Monetary Fund (IMF) views this war as a new black cloud that threatens the direction of the world economy. The IMF is closely monitoring the situation to assess various impacts. especially in the oil market

Watch out for Indonesia's "internal economy"

The Indonesian Entrepreneurs Association stated that the Hamas-Israel war It will affect the domestic economy. This is especially the case in the energy sector, which is starting to see prices increase. And when the price of energy increases, it will affect the price of various raw materials. that increased as well Because some raw materials cannot be produced within Indonesia. If the business atmosphere returns to what it was like during the COVID-19 outbreak. It may cause industrial growth to be halted.

Moreover, the conflict will also affect the ceramic industry. Because gas is required as a raw material for production. And another industry that is likely to be affected is Export of textiles and textile products Because the countries that are export markets for this group of products have changed from America and Europe to countries in the Middle East instead. If the textile export market is disrupted, it will cause the industry to shake as well.

For images of trade between Indonesia and Israel The total value of Indonesia's exports to Israel in 2565 reached US$185.6 million. This is an increase of 14% compared to last year. Meanwhile, the value of imports from Israel also increased by around 80% compared to last year. Valued at approximately 47.8 million US dollars.

In 2565, the main products Indonesia imported from Israel include air conditioners, heat pumps, and geothermal heat pumps. and various machinery. On the other hand, the main product that Indonesia exports to Israel is crude palm oil. The export volume will reach 22,000 tons in January 2565.

A protracted war could shake the Indian economy.

With the global economic situation still not looking good and the threat of economic recession causing conflict between Hamas-Israel It is a more serious threat. But only a long conflict will affect the stability of the Indian economy. The dimension that will have the biggest impact is oil prices because India depends on oil imports up to 85%, which if oil prices increase, it may have a negative effect on GDP growth.

It is worth noting that there is no immediate risk of supply disruption. Because Israel is not the main producer. But there are concerns that the situation could increase tensions across the Middle East, forcing more restrictions on Iranian oil and tightening the market.

Another unexpected effect is the escalation of the Israeli-Hamas war. This may push up the cost of importing 5G networks and delaying the launch of new generation networks. Meanwhile, trade could increase shipping costs and insurance premiums for Indian exporters if the situation worsens. Affecting bilateral trade and led to a halt in Israeli exports to India. The primary concern is fear that it will affect exporters' finances that may reduce profit margins.

The final impact that I would like to highlight is the India-Middle East-Europe Economic Corridor project. (India-Middle East-Europe Economic Corridor : IMEEC) which is a cooperation plan between 8 nations including the United States, India, Saudi Arabia. United Arab Emirates, France, Germany, Italy and the European Union. It is a huge infrastructure project. Aims to connect India through Saudi Arabia and Israel to Europe. This is believed to unlock huge trade opportunities for India and greatly promote global trade. But fear of war between Hamas-Israel It will create conflict between Israel and various Arab nations. and make various efforts Temporarily suspended

The total value of the various goods and services sectors of Israel-India trade in 2565-2566 is expected to be around US$12,000 billion. Meanwhile, India's exports and imports from Israel in 2565-2566 are estimated at USD 8,400 billion and USD 2,300 billion, respectively, leading to a trade surplus worth USD 6,100 billion.

India's main exports to Israel include diesel (US$5,500 billion), polished and cut diamonds (US$1,200 billion), while its main imports include rough diamonds (US$519 million), polished and polished diamonds (US$220 million), and polished and polished diamonds (US$411 billion). (US$105 million), electronics and telecommunications equipment such as solar cells (US$6 million), potassium chloride (US$XNUMX million), and herbicides (US$XNUMX million).

In terms of impact on Thailand Israel is Thailand's 40th largest trading partner and the 6th largest trade partner in the Middle East. If the war drags on, it could affect Israeli economic and business confidence. which takes time to recover And for the impact on Thailand, it is inevitable that the cost of transporting Thai goods to Israel and importing from the Middle East will increase. But at the same time Thailand may have an opportunity to increase exports of products such as rice, canned seafood, processed fruits, rubber, medical equipment, and medicine-related products. But one must be aware that Israeli consumers may spend less on non-essential goods during the war.

However, while many countries in Asia have been negatively affected by the war, But one country in Asia that has benefited from rising oil prices is Malaysia, when looking at both its growth and financial position. But even though the US dollar has strengthened and oil prices have increased, Economists still see some positive aspects of India. India's strong macroeconomic data will make assets of the country is still attractive even if it faces any obstacles.