Suez Canal Under Threat
The Suez Canal is facing a massive test, as the scourge of Somali piracy prompts major shipping companies to seek another route.
Egypt, which is greatly dependent on the fees it charges ships to go through the Canal, has expressed concern over a possible drop in income — though it says it’s hopeful an international flotilla patrolling the pirate-infested waters will be able to guarantee safe passage.
At least two shipping companies have announced their vessels will take the long route around the southern tip of Africa rather than go through the Canal, which requires crossing through the Gulf of Aden, scene of most pirate attacks.
To avoid the Gulf of Aden, Europe’s largest shipping firm A.P. Moller-Maersk A/S said last week it was telling some of its slower ships to sail around Africa’s Cape of Good Hope, and Norwegian shipping group Odfjell SE ordered its more than 90 tankers to do the same. That means adding up to two weeks to some voyages.
Gen. Ahmed Fadel, of the Suez Canal Authority, played down the expediency of the South African route. “It is not easy or simple to divert through the Cape,” he said. “It will lead to an increase in commodities transport fees to more than 30 percent.”
In fiscal year 2008, Egypt earned $5 billion in canal fees — up from $4.6 billion the previous year — making it the country’s third largest revenue generator after tourism and remittances from expatriate workers.
So far, Egypt has urged the international community to strengthen its anti-piracy efforts in the Gulf of Aden, without raising the possibility of adding ships from its 20,000-member navy to the fight.
Yousif Al Qassar
