Egypt’s Suez Canal Authority reported that revenues for January 2024 witnessed a massive decrease of 46% compared to the same period in 2023, from $804 million to $428 million.
The Authority’s Chairman, Osama Rabie, said in televised statements that 1,362 ships crossed the Canal in January of 2024, compared to 2,155 vessels in January 2023, a 36% drop.
Rabie noted that this is the first time the Suez Canal has gone through a crisis, adding that the Authority held many meetings with shipping bodies and companies to reach a solution.
He said that the meetings witnessed consensus that the Suez Canal route is the best, shortest, and safest maritime course and that the Cape of Good Hope is an unsustainable navigation route.
Rabie pointed out that ships are being delayed between 12 and 15 days, depending on the speed of the vessel and weather conditions, as a result of taking routes alternative to the Red Sea and the Suez Canal, thus disrupting global supply chains.
The official said the Suez Canal problem affects the whole world, not just Egypt.
He expected traffic through the Canal to increase rapidly after the current crisis is over to compensate for supply chains.
The International Monetary Fund (IMF) recently warned of escalating tension in the Red Sea region and its repercussions on trade and shipping costs.
The Fund said in a report that included an update on the regional economic prospects in the Middle East and North Africa (MENA) that after ships were subjected to drone attacks in the Red Sea and the Gulf of Aden, many major shipping companies transferred their shipments to alternative shipping routes, with potential implications for global supply chains and commodity trading, and higher insurance costs.
It warned that shipping costs could rise further if tension continues after some shipping companies shifted larger portions of their trade to longer alternative routes, which would increase fuel and operating costs.
