Egypt’s Suez Canal Authority is considering transit fee discounts of 12% to 15% to revive traffic through the key waterway, which has been severely affected by ongoing regional attacks.
- The Suez Canal Authority considers transit fee discounts of 12%-15% to boost maritime traffic.
- Regional attacks have impacted traffic, particularly due to Yemen’s Houthis targeting vessels in the Red Sea.
- The Suez Canal usually handles 15% of global trade, and disruptions have increased shipping costs.
Egypt’s Suez Canal Authority is considering transit fee discounts of 12% to 15% to revive traffic through the key waterway, which has been severely affected by ongoing regional attacks.
Yemen’s Houthis have attacked vessels in the Red Sea area since November 2023 in support of Palestinians in Gaza during the war with Israel.
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These attacks have led to a decline in traffic through the Suez Canal, the shortest maritime route between Asia and Europe, which typically handles about 15% of global trade. As a result, shipping costs have risen.
In a phone interview with the privately owned Sada al-Balad television channel, Suez Canal Authority chief Osama Rabie said the proposed discounts could be implemented within days, pending approval from President Abdel Fattah al-Sisi, according to Reuters.
Economic impact
His comments came after the Suez Canal’s revenue plunged to $880.9 million in the fourth quarter of 2024, down sharply from $2.4 billion a year earlier, according to Egypt’s central bank.
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President Sisi estimated in December that disruptions to the Suez Canal could cost Egypt around $7 billion in lost revenue in 2024.
The Suez Canal is a vital source of foreign currency for Egypt, and the downturn in traffic has raised alarms about the country’s economic stability.
Last week, Rabie met with shipping agency representatives, who urged the government to provide temporary incentives to ease the burden of soaring insurance premiums for vessels navigating the Red Sea, now classified as a high-risk zone.
