Analysis of the earnings the canal generated in 2013 of $5.1 billion, $5.5 billion in 2014, $5.2 billion in 2015, and $5 billion in 2016 demonstrate that since the opening of the wider canal in August 2015 earnings have not risen significantly.
As a matter of fact, earnings declined last year by 3.2 per cent compared to 2015. However, the downward trend reversed itself during 2017. Canal Authority director Mohab Mamish said that in the first nine months of this year earnings rose by 2.2 per cent year on year to reach $3.86 billion, reported The MediTelegraph of Genoa, Italy.
The number of ships also increased from January to September by 2.5 per cent year on year to hit 12,934, while tonnage carried was up 4.6 per cent to 781 million tonnes.In any case we are far away from the exponential growth in traffic that the government expected this project to produce, said Mr Mamish, who at the time of the opening, predicted that in 2023, earnings would balloon to $13.4 billion per year.
Although the figures remain far from those that were predicted, the improvement in 2017 could offer some hope, since it coincided with signs of recovery in the European economy. The European central bank is predicting that the Eurozone GDP will increase by 2.2 per cent in 2017, versus the 1.9 per cent growth it achieved in 2016.
To stimulate this growth, in the last year the Canal Authority has offered a series of discounts for certain types of ships and on certain routes. This led to a price war with the Panama Canal, which inaugurated its expansion a year after Suez, in June 2016.
The latest discount on the Suez Canal was announced in September and affects tanker ships. A 30 per cent reduction will be offered to ships carrying liquefied natural gas into the Persian Gulf and as far as the port of Kochi. A 40 per cent reduction in transit tolls will be offered to oil tankers heading east of the port of Kochi, as far as Singapore. Finally, the discount for Singapore and beyond will be 50 per cent.
Discounts were offered for container carriers from 2016 through this summer, while discounts for bulk carriers were introduced in early 2017. The results seem to partly indicate the success of this policy, but marketing work still remains to be done.
The Japanese Shipowners' Association (JSA) recently published data from 2017 on the decreased use of the Suez Canal by ships flying the Japanese flag, which are increasingly attracted by the Panama Canal to reach ports on the Atlantic coasts of North and South America.
In 2016, the number of Japanese ships transiting the Suez Canal declined by nine per cent compared to 2015 to 1,066 ships, for a 6.3 per cent decrease in spending on transit tolls, which came to $352 million.
To halt the drop in earnings, Egypt is developing a major plan around the Suez Canal which will provide additional services to the entire logistical supply chain.
The plan for a free trade zone is particularly important. At the end of September, President Mamish announced that Mercedes-Benz will open a 50,000 sqm distribution centre in this zone. There is also a plan to build a series of tunnels connecting Egypt to the Sinai peninsula, including three tunnels in port Said, three in Ismailia, and later on, three tunnels in the city of Suez.
As a matter of fact, earnings declined last year by 3.2 per cent compared to 2015. However, the downward trend reversed itself during 2017. Canal Authority director Mohab Mamish said that in the first nine months of this year earnings rose by 2.2 per cent year on year to reach $3.86 billion, reported The MediTelegraph of Genoa, Italy.
The number of ships also increased from January to September by 2.5 per cent year on year to hit 12,934, while tonnage carried was up 4.6 per cent to 781 million tonnes.In any case we are far away from the exponential growth in traffic that the government expected this project to produce, said Mr Mamish, who at the time of the opening, predicted that in 2023, earnings would balloon to $13.4 billion per year.
Although the figures remain far from those that were predicted, the improvement in 2017 could offer some hope, since it coincided with signs of recovery in the European economy. The European central bank is predicting that the Eurozone GDP will increase by 2.2 per cent in 2017, versus the 1.9 per cent growth it achieved in 2016.
To stimulate this growth, in the last year the Canal Authority has offered a series of discounts for certain types of ships and on certain routes. This led to a price war with the Panama Canal, which inaugurated its expansion a year after Suez, in June 2016.
The latest discount on the Suez Canal was announced in September and affects tanker ships. A 30 per cent reduction will be offered to ships carrying liquefied natural gas into the Persian Gulf and as far as the port of Kochi. A 40 per cent reduction in transit tolls will be offered to oil tankers heading east of the port of Kochi, as far as Singapore. Finally, the discount for Singapore and beyond will be 50 per cent.
Discounts were offered for container carriers from 2016 through this summer, while discounts for bulk carriers were introduced in early 2017. The results seem to partly indicate the success of this policy, but marketing work still remains to be done.
The Japanese Shipowners' Association (JSA) recently published data from 2017 on the decreased use of the Suez Canal by ships flying the Japanese flag, which are increasingly attracted by the Panama Canal to reach ports on the Atlantic coasts of North and South America.
In 2016, the number of Japanese ships transiting the Suez Canal declined by nine per cent compared to 2015 to 1,066 ships, for a 6.3 per cent decrease in spending on transit tolls, which came to $352 million.
To halt the drop in earnings, Egypt is developing a major plan around the Suez Canal which will provide additional services to the entire logistical supply chain.
The plan for a free trade zone is particularly important. At the end of September, President Mamish announced that Mercedes-Benz will open a 50,000 sqm distribution centre in this zone. There is also a plan to build a series of tunnels connecting Egypt to the Sinai peninsula, including three tunnels in port Said, three in Ismailia, and later on, three tunnels in the city of Suez.