Politicians offer praise and criticism of plan to build a parallel canal worth $4bn
by Kaylan Geiger and Alia Ibrahim
The largest force behind Egypt’s economy, the Suez Canal made headlines in early August when President Abdul Fattah El-Sisi unveiled his plan to revitalize Egypt’s economy with a $4 billion expansion project for the manmade waterway.
First opened in 1869, the Suez Canal has been one of Egypt’s biggest moneymakers for decades, providing a shipping link between Europe and Asia. Although the original canal took 10 years to construct, El-Sisi’s ambitious plan promises to complete the expansion project in one year’s time. The Suez Canal Authority has estimated a five-year timeframe for the project.
The expansion would see a new waterway built parallel to the current canal and is projected to reduce waiting time from 11 hours to 3 hours by creating a two-way passage for ships. By 2023 it is expected that the capacity for passing ships per day could reach 97, compared to the current 49. The project hopes to increase toll from $5 billon to $13 billion a year by 2023, which would pump addition funds into the economy.
Aside from increased revenue from ships, the digging and construction of the “new” canal would also create jobs and develop port cities along the canal, such as Suez, Port Said and Ismailia. Chairperson of the Suez Canal Authority Admiral Mohamed Mameesh said at the project’s inauguration that it would “transform Egypt into a center of economic and logistical and global trading, and this is just one of the project’s objectives […] this project will bring hard currency for the state.”
The multibillion-dollar project would rely mainly on local funding, as prescribed by El-Sisi who said the project would be financed by the offer of 500 million shares to Egyptians only.
El-Sisi’s surprise announcement has been met with both praise and speculation by politicians and commentators for its ambitious plans to revitalize Egypt’s economy.
“The Suez Canal Development project will create a major shift in the Egyptian economy, and it contributes toward overall development in Egypt,” said Free Egyptians Party President Said Ahmed Said to Al-Dostour. “The project would contribute to the rapid recovery of the Egyptian economy and it would return Egypt to the international stage.”
According to former Foreign Minister Maasoum Marzouk the project will put the nation on the path to development and “contribute to the development of the Egyptian economy.” Marzouk said in a statement that the project will benefit Egyptians and contribute to the elimination of unemployment and lead to an increase in national income.
While some politicians have praised El-Sisi’s plan, others are criticizing the praise as misplaced, noting the project resembles former President Mohamed Morsi’s plan to re-develop the canal.
Dr. Saad Fayyad of the Salafi Front says that Morsi wanted to develop the Suez Canal to support the economy and allocate its revenue to the Egyptian people, but “they took it as a threat to national security, and then El-Sisi poses the same project and makes the army and the trustee to be the biggest beneficiary from the military budget.”
Some industry observers are skeptical of El-Sisi’s timeline.
“If no major dredging is involved to allow bigger ships to go through, the work could progress smoothly and swiftly,” a senior executive of a European shipping company told The Wall Street Journal on the condition of anonymity. “But a year’s time is very ambitious. I don’t think it can be done.”
According to a statement by Egyptian Army spokesperson Mohamed Samir, digging on the new canal began August 6 and has been divided among 33 Egyptian companies and two army battalions.
Alia Ibrahim contributed to this report.