- The Suez Canal is vital to the Egyptian economy, contributing 2% to the national Gross Domestic Product (GDP).
- The current crisis in the Red Sea and Suez Canal region poses a substantial threat to the country’s financial well-being.
- Recent military actions by the US and UK in Yemen raise fears of further escalation in the region.
- Dollar revenues from the Suez Canal have witnessed a significant 40% decrease in the current year compared to 2023.
Crisis At The Suez Canal
Chairman and managing director of the Suez Canal Authority (SCA), Admiral Osama Mounier Mohamed Rabie said that dollar revenues from the canal are down 40% from the beginning of the year compared to 2023, while vessel traffic has declined by 30% in the same period.
According to Rabie, the number of ships that have passed through the Suez Canal dropped to 544 so far this year, from 777 in the equivalent period of 2023.
As the Suez Canal is crucial for the Egyptian economy, accounting for 2% of the national Gross Domestic Product (GDP), the crisis on the Red Sea and Suez Canal region could heavily affect the financial figures of the country.
Growing Concern
Although financial analysts see the economic impact of the crisis on a limited level at present, they are afraid that the situation could become painful if the canal’s traffic continues to be halted.
The recent attacks by the US and UK forces against Yemen could worsen the crisis. The US and British strikes in Yemen could harm Egypt’s already-struggling economy, according to former Egyptian deputy foreign minister Hussein Haridi, who added the attacks could also cause a widening of the conflict affecting the security and the economies of the Middle East and Europe.
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Source: Container News
