Egyptian President Abdel Fattah al-Sisi said on Thursday Egypt would defeat terrorism, as he inaugurated the New Suez Canal project and the first ship passed through the waterway.
“Egypt during this year stood against the most dangerous terrorist ideology, that would burn the world if it could,” he said at a lavish ceremony attended by world leaders. “We are fighting them and will defeat them.”
Egypt received a show of international support on Thursday as it inaugurated a major extension of the Suez Canal which President Abdel Fattah al-Sisi hopes will power an economic turnaround in the Arab world’s most populous country.
The inauguration ceremony was also intended to bolster his international standing in the presence of French President Francois Hollande, Russian Prime Minister Dimitry Medvedev, King Abdullah of Jordan, the emir of Kuwait and the king of Bahrain.
The $8 billion project was completed in just one year instead of three on Sisi’s orders, but economists and shipping analysts question whether there is sufficient traffic and east-west trade to meet its ambitious revenue targets.
The project involved extending a waterway parallel to part of the 19th century canal connecting the Mediterranean to the Red Sea, as well as deepening and widening the old channel – the shortest shipping route between Europe and Asia.
In economic terms, however, the expansion of the Suez Canal is a questionable endeavour at a time when the government is struggling to provide adequate services to its citizens. True, the channel is a significant source of revenue. Last year it pumped $5.5 billion into an economy weakened by years of turmoil. But both this sum and the number of ships transiting the canal have been flat since 2008.
Before its expansion the Suez Canal was operating below its capacity of 78 vessels a day. It could already handle all ships except the very biggest oil tankers. By the estimate of one Egyptian economist, the maximum growth of revenue that the new dredging now allows from the passage of slightly bigger oil tankers amounts to just $200m a year. Boosters say more ships will flock to the canal because new bypasses permit faster two-way traffic. Economists counter that for ships that already save as much as ten days at sea by using Suez instead of sailing around Africa, a few hours less transit time through the canal will make little difference.
Current situation in Egypt
The canal expansion is the centerpiece of a grand agenda by Sisi to cement his tenure as the man who brought stability and prosperity to Egypt after he ousted elected Muslim Brotherhood President Mohamed Mursi in 2013 following mass protests.
Egypt’s allies are keen to burnish its image in a region beset by turmoil. Cairo too faces an increasingly brazen two-year-old insurgency based across the Suez Canal in the Sinai peninsula that has killed hundreds of police and soldiers.
In an ominous turn, Islamic State’s Egyptian affiliate released a video on Wednesday threatening to kill a Croatian hostage within 48 hours if Muslim women prisoners were not freed. Last month, the group managed to fire a rocket at an Egyptian navy vessel in the Mediterranean, near the coast of Israel and the Gaza Strip.
— Business Insider (@businessinsider) 7 Août 2015
Sources: Reuters, The Economist, New York Times,