Kuwait Bans Shipping with Israel While DP World Withdraws Haifa Bid

Despite signs of progress in Arab-Israeli trade after the normalization of relations with the UAE and Bahrain, there were recently two setbacks. Kuwait reaffirmed the hardline stance against Israel announcing that it would ban ships sailing between the two countries or carrying cargo bound for Israel while DP World also confirmed that it has withdrawn from the bidding for the privatization of operations in the Port of Haifa.

Kuwait has been a consistent hardliner against Israel vowing it would be the last to normalize any form of relations. Last week government representatives spoke out strongly in favor of Palestinian causes at the United Nations and it was followed on Saturday, December 5, by the decree against shipping. Kuwait’s Minister of Public Works and Minister of State for Communications and Information Technology announced a decree banning the entry of vessels carrying goods to and from Israel.

While the move is in keeping with past policies of the Kuwaiti government, observers were surprised by the depth of the statement. In addition to any direct movement of cargo, Kuwait said it will deny permits for ships trading between the two countries but also to any vessel even coming from others ports carrying Israeli goods or with goods directly or indirectly bound to Israel. The ban went into effect immediately.

Elsewhere in the Arab world, there have been major advancements for shipping since the normalization of relations. In October 2020, an MSC containership arrived in Haifa with the first cargo transported between the UAE and Israel. MSC reported that it was part of a new normal service on its route between India and the Mediterranean. Previously, ships sailing from the UAE had to follow a longer route going to ports such as Cyprus or Greece before returning to Israel after departing the UAE.

Last week, officials in Israel also confirmed that DP World had requested to withdraw from its joint bid with an Israeli company for the privatization of the Port of Haifa. The agreement between DP World and the entrepreneur that owns the Israel Shipyards had been hailed as one of the first tangible signs of progress after the agreement to normalize relations between the UAE and Israel.  DP World did not comment on the reasons for withdrawing 

The efforts to privatize Haifa’s port are proceeding. Israel Shipyards reportedly revised the proposal to a standalone offer but without the strength of DP World is now seen as a longshot. The process had been expected to be completed before the end of this year.