6.08.2015

Egypt set to launch Suez Canal expansion



Egypt is set to open a major expansion of the Suez Canal, deepening the main waterway and providing ships with a 35km (22 mile) channel parallel to it.Foreign leaders are due to attend an inauguration ceremony on Thursday, promoted by Egypt's government as an occasion for national pride. The expansion aims to increase the traffic handled by the canal.Egypt's government hopes the revenues will boost the economy - but analysts have questioned the projections.They point out that the volume of world trade has not been growing at the pace needed to deliver the sums Egypt hopes to collect. Takings from Suez could also be hit by an expansion of the Panama Canal, due to be completed next year, which will compete for traffic along the Asia-North America route.Ahmed Kamaly, an economist with the American University in Cairo, told Reuters news agency that the Egyptian projections were "wishful thinking"."There was no viability study done, or known of," he was quoted as saying. He added that the immediate benefits from the expansion were more likely to be political than economic, uniting people "around a national project".
Egyptians celebrate the canal's expansion in Tahrir Square, Cairo
Egyptians have been celebrating the canal's expansion in Cairo's Tahrir Square

Many Egyptians have also questioned whether the money could have been better spent on welfare or other infrastructure work.
The project is estimated to have cost $8.2bn (£5.3bn).
The expansion will allow for two-way traffic along part of the route, as well as for larger vessels overall. The construction of the new lane began a year ago, on the orders of Egypt's President Abdel Fattah al-Sisi.
Security has been tightened for the inauguration ceremony amid fears of attack by militants allied to Islamic State.
The militants, based in the Sinai peninsula, have killed hundreds of people since the military overthrew the Islamist government of president Mohammed Morsi in 2013.
The original canal, opened in 1869, currently handles 7% of global sea-borne trade.
The waterway connects the Mediterranean to the Red Sea, providing the shortest sea link between Asia and Europe.
Its nationalisation led to a brief war in 1956, pitting Egypt against the UK, France and Israel.

Source: http://www.bbc.com/news/world-middle-east-33800076

Suez Canal project

$8.5bnraised for canal expansion project$13.2bnprojected revenue by 2023 (up from $5.3bn)
  • 72km of new channel and bypasses 
  • 97 ships a day by 2023 (up from 49) 
  • 11-hour southbound transit (down from 18) 
  • 12 months to complete project by Aug 2015 
Source: Suez Canal AuthorityAFP







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