Suez Canal revenue plummets; EU sets up force to protect cargo ships in Red Sea

Suez Canal revenue drops sharply

The information was announced by Egyptian President Abdel-Fattah El-Sisi in his opening speech at the 7th Egyptian Energy Exhibition (EGYPES 2024) held at the Al-Manara International Conference Center in New Cairo.

According to Mr. El-Sisi, the economic impacts of past and present challenges that Egypt has faced and is facing, including the Covid-19 pandemic, the Russia-Ukraine war as well as instability in Libya, Sudan and the Gaza Strip.

“ All this comes in the context of the Egyptian government’s commitment to fulfilling its obligations to oil and gas companies, development partners and financial institutions ,” Mr. El-Sisi stressed.

In January 2024, the Chairman of the Suez Canal Authority, Osama Rabie, said that the number of ships passing through the Suez Canal in the first two weeks of January 2024 had decreased by 30% compared to the same period last year, from 777 ships to 544 ships.

Doanh thu kênh đào Suez giảm mạnh; EU thành lập lực lượng bảo vệ tàu hàng ở Biển Đỏ

Many shipping companies have to divert ships away from the Red Sea (Illustration photo)

According to Mr. Rabie, revenue in USD from the Suez Canal in the first two weeks of January 2024 decreased by 40% compared to the same period in 2023, while the volume of transportation decreased by 41%.

Houthi forces began attacking commercial vessels in the Red Sea in October 2023, after the Israel-Hamas conflict erupted, and show no signs of stopping. Many shipping companies have diverted from the Red Sea to avoid Houthi attacks, instead choosing the longer and more expensive route around the Cape of Good Hope at the southern tip of Africa.

The Suez Canal is the shortest sea route between Asia and Europe and is a major driver of global trade. This vital waterway carries about 12% of the world's maritime trade.

EU sets up force to protect cargo ships in the Red Sea

European Commission (EC) President Ursula von der Leyen said that EU countries have established a task force tasked with protecting international shipping routes in the Red Sea from Houthi attacks.

“ I welcome the decision to launch the European Union (EU) Naval Force Operation Aspides (which means ‘shield’ in Greek). Europe will work together with international partners to ensure freedom of navigation in the Red Sea ,” Ms. der Leyen pointed out.

Aspides will reportedly have at least four warships and is expected to be operational in a few weeks. The mission's commander is Greek, while the officer in charge of operations at sea is an Italian citizen.

The EU announced that the Aspides force will only protect cargo ships in the Red Sea and will not conduct raids on Yemen's mainland territory.

Italy, France, Germany and Belgium have previously confirmed they will contribute warships to the force. The alliance is also open to non-European countries and will operate for at least a year.

“ Italy is at the forefront of efforts to protect commercial interests and freedom of navigation in the Red Sea. This is an important step towards a common European defense ,” Italian Foreign Minister Antonio Tajani said.

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