Dollar revenues from Egypt’s Suez Canal have experienced a significant decline of 40 percent compared to the same period in 2023, according to statements made by canal authority head Osama Rabie during a telephone interview with journalist Khaled Abu Bakr.
The decrease in revenue is attributed to attacks on ships by Yemen’s Houthis, leading major shippers to divert away from the route.
Yemen’s Iran-aligned Houthis have targeted commercial vessels in the Red Sea as a show of support for the Palestinian’s Hamas in its war with Israel. These attacks have prompted many shippers to seek alternative routes.
Therefore, on 19 December, the United States announced a new international mission to patrol the Red Sea and deter such attacks.
Ship traffic has also been affected, with a 30 percent drop between 1 January and 11 January compared to the previous year.
To address the crisis, Rabie stated that he met with various international cargo companies to find solutions. He also provided additional data, indicating that ship traffic in January 2024 decreased by 40 percent, with 793 fewer ships compared to January 2023.
Furthermore, the revenue for January 2024 amounted to USD 428 million (EGP 13 billion), a decrease from USD 804 million (EGP 24 billion) in the same month the previous year.
Rabie then explained that ships that urgently needed to proceed with their journeys have diverted around the Cape of Good Hope, while others are waiting for the situation to stabilize. Despite the decline in traffic and revenue, Rabie expressed optimism that a significant portion of goods would return to the Suez Canal once the Houthi attacks are resolved.
The Suez Canal is a vital source of foreign currency for Egypt, and authorities have made efforts to boost revenues in recent years, including through canal expansions.