Global supply chains, already hit hard by the pandemic, are facing further disruption and cost inflation as airspace closures after Russia’s invasion of Ukraine affect the air freight industry.
Amid ever-growing international condemnation, Russia found itself increasingly isolated six days into its invasion, while also facing unexpectedly fierce resistance on the ground in Ukraine and economic havoc at home.
Global supply chains, already hit hard by the pandemic, are facing further disruption and cost inflation as airspace closures after Russia’s invasion of Ukraine affect the air freight industry, reported Reuters.
Transport between Europe and north Asian destinations like Japan, South Korea and China has become particularly problematic due to reciprocal airspace bans that bar European carriers from flying over Siberia and Russia airlines from flying to Europe.
Airlines responsible for moving around 20% of the world's air cargo are affected by those bans, Frederic Horst, managing director of Cargo Facts Consulting, told Reuters on Tuesday.
Germany’s Lufthansa, Air France KLM, Finnair and Virgin Atlantic have already cancelled north Asian cargo flights over airspace issues, though major Asian carriers like Korean Air Lines and Japan’s ANA Holdings are still using Russian airspace, as are Middle Eastern airlines.
Sanctions imposed on Russia in the wake of its invasion of Ukraine are expected to further disrupt global supply chains.
Russia’s AirBridgeCargo alone moves just under 4% of global international air cargo, with most of that between Europe and Asia.
US-based United Parcel Service Inc and FedEx Corp, two of the world's largest logistics companies, have halted deliveries to Russia.
Meanwhile, Hollywood studios Disney, Warner Bros, and Sony Pictures Entertainment said they would pause theatrical releases of upcoming films in Russia in response to its invasion of Ukraine and the unfolding humanitarian crisis. Russia is a significant market for Hollywood, accounting for $601 million in box office in 2021, or about 2.8% of worldwide ticket sales, which totalled $21.4 billion last year, according to Comscore.
Several major films are slated for global release, ‘The Batman’, scheduled to open in Russia on March 3 as part of a worldwide roll-out, and Paramount Pictures' 'Sonic the Hedgehog 2' which makes its global debut on April 8.