The South African Chamber of Commerce and Industry (Sacci) has sounded a stark warning over the escalating conflict in the Middle East, saying the crisis is already destabilising global markets and poses a serious threat to South Africa’s economic recovery prospects.
The business lobby group on Monday said the war, which has disrupted shipping routes and pushed oil prices sharply higher, is triggering ripple effects across the global economy that are being felt in emerging markets such as South Africa.
Brent crude traded above $113 per barrel on Monday after earlier touching $115 as investors reacted to renewed tensions and uncertainty over the reopening of the Strait of Hormuz, one of the world’s most critical energy corridors.
The narrow waterway carries roughly a fifth of global oil supplies, and any disruption has an immediate impact on global prices and shipping costs.
Sacci CEO Alan Mukoki said the conflict had evolved beyond a regional dispute and was now dragging the broader global community into an “unsustainable conflagration”.
“The rise in the oil price and the blockages happening in international waters in terms of trade and the movement of ships and goods will definitely have a significant effect on global supply chains,” Mukoki said.
He warned that the consequences would filter quickly into domestic economic indicators, with higher fuel costs feeding into inflation and, in turn, forcing central banks to keep interest rates higher for longer.
“This war is creating uncertainty, complexity and ambiguity, and we don’t know exactly where this volatility is going to go,” he said. “Businesses invest in environments where there is a level of stability, and this conflict has now developed very long tails that are affecting everyone.”
Sacci said the knock-on effects of the conflict were likely to show up in deteriorating economic indicators globally, including slower growth, rising inflation, volatile exchange rates and increased commodity price swings.
For South Africa, which is already grappling with structural constraints, weak growth and fiscal pressure, the external shock could derail the modest recovery that had begun to take shape.
The chamber noted that several Middle Eastern economies are important trade partners for South Africa, meaning prolonged instability in the region could disrupt exports and imports, delay shipments and raise insurance and logistics costs.
Recent reports indicate that tanker traffic through the Strait of Hormuz has been severely curtailed, forcing shipping companies to reroute vessels and raising freight and insurance costs across global supply chains.
Mukoki said these disruptions were already filtering into global financial markets, contributing to volatility in equities and currencies, as well as rising energy and transport costs that ultimately hit consumers.
Sacci emphasised that emerging markets were particularly vulnerable to such shocks because they rely heavily on imported fuel and are more sensitive to capital outflows when global uncertainty rises.
“This does not bode well for any prospect of recovery that we would have anticipated as South Africa,” the chamber said in its statement.
The organisation called on all parties involved in the conflict to exercise restraint and prioritise diplomatic solutions, warning that continued hostilities would only deepen global economic fragility and prolong uncertainty.
“The adventure of wars cannot resolve disputes,” Mukoki said, urging warring nations to give diplomacy a chance and to refrain from targeting civilian infrastructure such as power stations, desalination plants and logistics networks.
Beyond its call for international restraint, Sacci also urged the South African government to take a more assertive diplomatic stance. The chamber suggested that Pretoria should work with international partners to help broker peace or support coordinated global efforts aimed at securing a ceasefire.
Mukoki pointed to President Cyril Ramaphosa’s previous diplomatic engagements in conflicts such as the Russia-Ukraine war as evidence that South Africa could play a constructive role in advocating for dialogue and de-escalation.
The chamber stressed that the destruction of energy and water infrastructure in conflict zones had consequences far beyond national borders, affecting global supply chains, commodity markets and humanitarian conditions.
Sacci warned that if the conflict drags on, it could undermine confidence in multilateral institutions and delay global economic recovery, particularly in developing economies that lack the buffers to absorb external shocks.
“The longer this war continues, the greater the risk that it entrenches instability in global markets and erodes the fragile gains made in post-pandemic economic recovery,” Mukoki said.
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