Cape Town – Egypt is considering further expansions to the Suez Canal to enhance its capacity and competitiveness, aiming to complete a second channel of the famed waterway.
The move comes as the canal faces a decline in revenue, attributed to shipping companies diverting vessels from the route because of attacks by Houthi militants based in Yemen.
Work on the second channel was accelerated following the stranding of the Ever-Given container ship in March 2021, which halted shipping traffic for six days, reports Bizcommunity. Ongoing work includes extending the second channel by 10km and deepening and widening a section of the canal.
Initial studies of the proposed expansion will take about 16 months, covering feasibility, environmental, engineering, soil and dredging research. The project will require government approvals and funding from the Suez Canal Authority’s investment budget to avoid straining the state’s general budget.
Egypt spent $8.2 billion expanding the canal in 2015, creating a parallel waterway. Canal revenues reached a record $9.4 billion in the financial year ending June 2023 but dropped by at least 40% at the beginning of the current financial year because of the Houthi attacks.
According to the Egyptian Independent, an Egyptian MP and vice-president of the Social Democratic Party, Freddy al-Bayyadi, has raised concerns about the potential financial risks associated with the plan to proceed with the Suez Canal duplication project.
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Compiled by Samantha Mochele
