The Association of International Shipping Lines (AISL) in the Philippines said the current security situation in the Middle East will require diversion of vessels and cargoes making it difficult and more costly for exporters and logistics companies.
AISL President Patrick Ronas said in reply to question from Logistics News PH on the impact of the developing situation in the Middle East following the US-Israel strikes against Iran over the weekend and the retaliation by Iran to other countries in the region.
While it is still too early to tell on the effects of the situation on international shipping, Ronas said it definitely poses a challenge to exporters who move their cargo to the Middle East. “All ports and airports are closed and therefore vessels and cargo to that area will be diverted,” he said.
This development, he said, will now push carriers to go through the Cape of Good Hope again and this is a longer transit, it adds two weeks into the transit time.
“When your transit time is longer it adds costs not only fuel but also ship charter hires. Insurance premiums will also go up as there is a war ongoing in the region,” he said.
According to Ronas, international shipping lines were already optimistic in the last couple of weeks because of the restoration of passage thru the Red Sea.
He said it was a welcome news for traders to and from Europe and the Middle East. “Transit thru this area is the shortest route from Asia to Europe,” he said.
Early this year, the Philippines expressed optimism for improved trade activity in the region after it signed a bilateral free trade agreement (FTA) with the United Arab Emirates, marking the nation’s first free trade deal in the Middle East.
The Comprehensive Economic Partnership Agreement (CEPA) was signed by Department of Trade and Industry (DTI) Secretary Cristina A. Roque and United Arab Emirates (UAE) Minister of Foreign Trade Thani bin Ahmed Al Zeyoudi in the presence of President Ferdinand R. Marcos Jr., who is on a short working visit in UAE, and UAE President Mohamed bin Zayed Al Nahyan on January 13, 2026 in Abu Dhabi.
Under the agreement, about 95 percent of Philippine exports to the UAE will enjoy preferential tariff treatment, helping manufacturers expand exports, scale up production, and generate more jobs at home. Benefiting products include personal care and cosmetic items (hair creams and deodorants), food products (canned tuna, sardines, snacks, and condiments), electronic equipment (hair dryers, instant-print cameras, and parts of electrical machinery), automotive and aircraft parts, and textile and apparel products.
Moreover, the CEPA provides clearer and more predictable rules for businesses operating in key service sectors, including professional services, construction, retail, IT-BPM, and tourism. This improved business environment supports the expansion of Filipino service providers in the UAE and encourages UAE firms to invest in the Philippines.
The agreement also goes beyond traditional trade by opening cooperation in priority areas such as digital trade, MSME, trade and sustainable development—covering the promotion and protection of labor and the environment—intellectual property rights protection and enforcement, competition and consumer protection, government procurement, and economic and technical cooperation.
In 2024, the UAE ranked among the Philippines’ top trading partners and served as a major export market in the Middle East, highlighting the significance of the CEPA’s wide-ranging cooperation framework as both countries move toward deeper trade, services, and investment integration.
