CAIRO (Agencies): Egyptian President Abdel Fattah El-Sisi has announced that revenues from the Suez Canal have decreased by 40 to 50 percent this year due to attacks on shipping by Yemen’s Houthi rebels. The Suez Canal is a major source of foreign currency for Egypt, which is currently facing a severe financial crisis.
The Iran-backed Houthis have launched numerous attacks on vessels in the Gulf of Aden and Red Sea since November. These attacks, which the group claims are targeted at ships with links to Israel in solidarity with Palestinians in Gaza, have led several major shipping firms to suspend passage through the Red Sea. This route typically carries around 12 percent of global trade, and the suspension has forced vessels to divert thousands of miles around Africa.
El-Sisi highlighted the impact of these events during a conference with oil companies, noting the significant decrease in revenues from the Suez Canal, which used to bring Egypt nearly $10 billion per year.
The United Nations reported in late January that the overall number of ships passing through the Suez Canal had fallen 42 percent in the previous two months. According to the UN Conference on Trade and Development, the number of weekly container ship transits through the Suez fell by 67 percent year-on-year, while tanker traffic dropped 18 percent, the transit of bulk cargo ships carrying grain and coal was down six percent, and gas transport was at a standstill.
The Suez Canal, an engineering landmark that opened in 1869, raised around $8.6 billion for Egypt in the 2022-23 fiscal year. This revenue is a vital source of foreign currency, alongside tourism and remittances, in a country where importers and money changers struggle to source dollars.