The new extension is set to boost the canal’s capacity by six to eight vessels a day
In 2015, Egypt initiated an $8 billion expansion of the Suez Canal, which was subsequently followed by several smaller development initiatives.
With the completion of this project, testing of the new 10-kilometer extension has commenced, aimed at reducing the impact of currents on shipping and enhancing the capacity of this crucial waterway.
According to a statement from the Suez Canal Authority, two vessels utilized the new extension on Saturday.
Osama Rabie, the head of the Authority, stated that the improvements in the southern section of the canal will “enhance navigational safety and mitigate the effects of water and air currents on vessels in transit.”
There have been instances where ships navigating the canal have run aground, primarily due to strong winds and sandstorms.
In 2021, the massive container ship Ever Given became lodged diagonally in the canal, obstructing trade for nearly a week and causing delays that incurred billions of dollars in losses.
Rabie indicated that the new extension is expected to increase the canal’s capacity by six to eight vessels per day and will be operational following the issuance of new navigational maps.
The Suez Canal has historically been a crucial source of foreign currency for Egypt, which is currently experiencing its most severe economic crisis.
The International Monetary Fund reports that revenue from the canal has decreased by as much as 70 percent since last year, largely due to attacks by Yemen’s Iran-backed Houthi rebels on shipping in the Red Sea. Before these attacks, which prompted companies to alter their shipping routes, the canal accounted for approximately 10 percent of global maritime trade.
Since November 2023, the Houthis have conducted nearly 100 assaults on vessels in the Red Sea, claiming these actions are in support of Palestinians affected by Israel’s military operations in Gaza, which have resulted in over 45,400 fatalities and at least 107,950 injuries among Palestinians.
These Houthi actions have compelled numerous shipping companies to alter their routes, opting to navigate around the Cape of Good Hope in South Africa and completely avoiding the Suez Canal.
The turmoil in the Red Sea has severely impacted Egypt, which is already grappling with a deepening economic crisis. Inflation rates are soaring, the national currency is plummeting, and millions of Egyptians are facing an escalating cost-of-living crisis.
As revenues from the Suez Canal dwindle, Egypt’s tourism and remittance sectors will encounter heightened challenges in supporting an economy that is on the verge of collapse.
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