The first Suez Canal Global Conference kicked off this week in Cairo in the presence of ministers, diplomats and executives from the world's leading shipping companies. The conference, entitled the “Suez Canal Global Conference: Opportunities and Challenges,” was organised by the Suez Canal Authority (SCA) in cooperation with the ministries of transport and international cooperation. The Suez Canal is one of the most important waterways in the world, and it is important not only on the economic, but also on the geopolitical front, Sherine Hassan, a maritime expert and former head of Port Said's port, told conference participants. Many changes had taken place recently, he said, especially in countries that use the canal. Hassan said that EU countries had resorted to Qatari liquefied natural gas (LNG), for example, breaking their dependence on Russian gas in the wake of the Ukrainian crisis. Qatar is now exporting more than 45 per cent of its LNG to the European Union, and it has been asked to increase that amount. This naturally affects the Suez Canal and the volume of trade going through it, Hassan said, adding that 87 per cent of the LNG going to Europe is shipped through the canal, making it vital for EU energy security and trade. According to Hassan, some of the present geopolitical changes constitute opportunities for the canal, including a giant shipping development programme currently being carried out by China. However, there are also challenges, he said. Despite the fact that many praised the inauguration of the New Suez Canal in August last year, there have been concerns about the effect on it of changes in the world economy. Tim Power, a head advisor at Drewry, a UK-based advisory organisation for the maritime sector, said that the new canal holds out opportunities for Egypt. He added, however, “We're living in uncertain economic times. Many shipping sectors are in deep distress, stock markets are crashing down, and China's growth is slowing.” The ongoing slowdown in the global economy caused the canal's revenues to plummet, even after the inauguration of the new canal. Egypt's monthly receipts from the Suez Canal fell by close to seven per cent year on year in October 2015. Revenues for the month dropped to $449.2 million, compared to $482.3 million in October 2014. The drop was ascribed to a slowdown in global economic activity. In August 2015, President Abdel-Fattah Al-Sisi inaugurated an expansion of the canal that the government claimed would bolster revenues from the waterway from $5.3 billion in 2014 to $13.2 billion in 2023. Besides slowing global trade, the vital waterway could also be challenged by new maritime routes that Hassan described as “competitors” to the canal, including the Panama Canal, the overland Silk Roads extending across Asia, and the Bering Straits connecting the Pacific and Arctic Oceans in a route going close to the North Pole. However, Hassan said the Suez Canal has advantages over all these other routes and is optimistic about prospects for the world economy, saying that the current low prices of oil and the Chinese economic slowdown will likely not continue and that global trade will pick up soon. The conference also saw the inauguration of the new East Port Said Canal, with Mohab Memish, head of the Suez Canal Authority, saying that the new channel will speed up shipping and allow ships direct entry into Port Said without the need to pass through the Suez Canal. He said that the new channel will help reduce waiting times for ships in the port, which currently stand at between eight and ten hours, and thus increase the competiveness of East Port Said. The new canal is 9.5 km long, 17 metres deep, and 250 metres wide, according to the Suez Canal Container Terminal. The inauguration of the new channel comes as part of the continuing development of the Suez Canal Zone, a focal point of Egypt's economic development strategy. The first Suez Canal Global Conference comes in the light of the SCA's desire to be in direct and more effective contact with its main customers and the main players in the international shipping market. Besides the conference sessions, the meeting also saw workshops attended by specialists discussing the most important issues related to the Suez Canal. The Suez Canal is one of the most important global waterways. A tenth of the world's trade passes through it, and it is the fastest shipping route between Europe and Asia. Together with tourism and foreign direct investment, the Suez Canal is one of Egypt's largest foreign currency sources, with revenues coming in at $5 billion a year on average. The canal saw a drop in revenues in 2015, registering $5.17 billion compared to $5.46 billion the previous year.
