Gia Lai moves to shield exports from Middle East turmoil as shipping disruptions raise costs

Some local companies have already faced delays in fulfilling export orders as shipping routes are adjusted to avoid areas affected by regional tensions.

In response, the provincial Department of Industry and Trade is introducing measures aimed at helping businesses adapt to shifting market conditions and maintain export growth momentum in 2026.

A reporter from Gia Lai Newspaper and Radio & Television spoke with Nguyễn Đình Kha, Deputy Director of the provincial Department of Industry and Trade, about the impact on local exporters and the steps being taken to mitigate risks.

Overview of exports to the Middle East

*Could you provide an overview of Gia Lai’s current exports to the Middle East and the extent to which local businesses depend on this market?

- At present, 20 enterprises in Gia Lai export goods to the Middle East. Key export products include coffee, cassava and cassava products, ores and other minerals, plastic products, textiles and garments, wood products, machinery and equipment, among others.

In 2025, the province’s export turnover to the Middle East is estimated at 24.315 million USD, accounting for about 0.7% of Gia Lai’s total export value.

Exports are mainly concentrated in several markets. Israel is the largest, with 16.415 million USD, followed by the United Arab Emirates with 3.358 million USD, Turkey with 1.323 million USD, and Saudi Arabia with 0.983 million USD.

* How is the conflict in the Middle East affecting delivery schedules and export costs for businesses, especially for shipments using routes through this region?

- According to reports from exporting enterprises in the province, recent tensions in the Middle East have affected international maritime transport activities.

Several major shipping lines, including CMA CGM, Maersk and Hapag-Lloyd, have adjusted their routes to ensure maritime safety. Instead of following traditional routes, many vessels now detour around the Cape of Good Hope, significantly increasing travel distance.

These route changes have extended delivery times and pushed up logistics costs, including fuel expenses, marine insurance and other surcharges.

Some businesses estimate that logistics costs for export orders have risen by 15–25% compared with previous levels. In some cases, goods must remain longer at transshipment ports, generating additional warehousing costs and affecting contractual delivery schedules.

However, since the province’s direct exports to the Middle East account for only a small share of overall trade, the broader impact on Gia Lai’s export activities remains limited.

Local businesses are also working closely with transport and logistics partners to adjust shipping plans and select suitable routes to ensure that export contracts are fulfilled on time.

Long-term risks from geopolitical tensions

*In the long term, how might geopolitical fluctuations in the Middle East affect the export activities of local businesses?

- Prolonged instability in the Middle East could indirectly affect exports through fluctuations in global energy prices and logistics costs.

When oil and fuel prices rise, transportation costs for both sea and air freight typically increase. This can raise the cost of exporting goods to major markets such as the United States and the European Union.

At the same time, international shipping routes may need to be adjusted to avoid conflict zones. Such changes could lengthen transit times and increase expenses for fuel, marine insurance and warehousing.

These factors may ultimately raise the cost of exported products, affecting their competitiveness in international markets and indirectly impacting exports to key trading partners.

Measures to sustain export growth

*In light of these developments, what measures is the Department of Industry and Trade implementing to support businesses and ensure the province’s export growth target for 2026?

- To proactively respond to international developments, particularly the effects of conflict in the Middle East, the Department is implementing several measures to help maintain the province’s export growth target for 2026.

First, businesses are being encouraged to diversify export markets and supply sources. Companies are advised to seek markets with similar demand in order to reduce risks if exports to certain markets, such as Israel, Iran or other Middle Eastern countries, encounter difficulties.

Enterprises are also urged to develop long-term contingency plans for similar disruptions in the future.

During negotiations and the signing of international sales contracts, companies should pay close attention to clauses related to logistics, transportation, delivery and insurance in order to limit potential risks. Businesses are also encouraged to purchase comprehensive cargo insurance to minimize potential losses.

In addition, the Department is strengthening coordination with relevant ministries and agencies to provide timely updates on import-export activities, international transport developments, freight rate fluctuations, logistics surcharges and geopolitical factors that may affect business operations.

Authorities are advising enterprises to develop proactive response plans to reduce the risk of supply chain disruptions.

The Department will also continue working closely with units under the Ministry of Industry and Trade, including the Import-Export Department, the Trade Promotion Agency and the Department of Foreign Market Development, as well as Vietnam’s overseas trade offices, to help businesses secure new orders and expand into potential export markets.

Through these measures, Gia Lai aims to maintain export growth in 2026. The Provincial People’s Council has set a target of 3.1 billion USD, with an ambition to reach 3.5 billion USD, while helping businesses strengthen their ability to adapt to increasingly complex global trade conditions.