Egypt’s Canal Receipts Fall by Almost Half After Red Sea Attacks
(Bloomberg) -- Egypt’s Suez Canal revenue plunged by almost half in January, a top official said, after attacks by Yemeni militants on Red Sea vessels forced major shipping firms to avoid the waterway.
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Income was about $428 million last month, compared with $804 million for the same period in 2023, Suez Canal Authority chief Osama Rabie told an Egyptian TV talk-show on Friday evening. The number of ships navigating the canal fell 36%, he said.
The drop is the latest headache for the North African nation that was already wrestling with its worst economic crisis in decades before the Israel-Hamas war erupted in October and threatened to disrupt trade and tourism.
Iran-backed Houthi militants in Yemen, who began attacking merchant shipping in response to the conflict in Gaza, are showing no let-up even after the US and allies began air-strikes on Jan. 12 to deter them.
The Suez Canal, the shortest sea route between Asia and Europe, is an important source of foreign currency for Egypt and netted some $10.25 billion in 2023. Before the violence that’s caused firms including A.P. Moller - Maersk A/S and Hapag-Lloyd AG to divert, the country had been working on expanding the waterway.
Read More: Suez Canal Traffic Drops to the Lightest Since 2021 Ship Logjam
“This is the first time the Suez Canal is involved in a crisis like this,” Rabie said. “We used to find every month better than the previous and every year better than the ones before.”
Egypt is nearing a deal with the International Monetary Fund that may more than double its current $3 billion rescue package and bring in other partners.
Read More: MIDEAST INSIGHT: Red Sea Adds $315 Mln Bill to Egypt Problems
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