The Suez Canal is a 115-year old engineering marvel that connects the Red Sea to the Mediterranean. The canal’s construction was a huge feat of engineering, and its importance to international trade continues to be vital in today’s economy.
In this article we will explore what connections the Suez Canal has with today’s world, how it was historically important for trade in Europe and Asia, and why it is still vital for economic growth.
The Suez Canal connects Egypt to the world of international trade. It was built in 1869 between the Mediterranean Sea and the Red Sea. As a result, boats can navigate from Europe to Asia without expending any energy fighting against the wind, as they would have to on a trip around Africa. With this shortcut around Africa, goods can be transported a lot faster and easier into Asia and Europe.
In order for a boat to pass through this canal they will have to pay dues which go towards the maintenance of this canal. Ships pay 68 Euro per ton of cargo carried at normal waterway depths. When the canal is not at normal water levels, dues are charged at higher rates. The Suez Canal also collect tolls on long-term leases, with minor variations in rates per ton for different periods.
Since the canal connects Europe to Asia, it has become one of the most important shipping routes in the world. A large amount of international trade passes through the Embraer jetliner. The United States embassy has staff working in Egypt to help American companies import goods into Egypt through the Suez Canal. Other countries that use shipping via this route include Japan, China, Saudi Arabia, etc. For example, 95% of all Iranian oil exports pass through this system.
As a result, the Suez Canal is an important factor of global trade and economic growth. The canal has made it so goods can be transported from Europe to Asia in a short amount of time, and as a result, many companies have taken advantage of this. For example, more than 70% of all shipping between China and Africa go through the Suez Canal.
The importance of the canal is undeniable. However there are still some issues that come with it. For instance, this system sees two times as many accidents as almost any other shipping route around the world: 94 compared to 26 per year on average.
The Suez Canal has also seen large cost increases since the British bought shares in the canal in 1875. These share increases have added 20% to annual operating costs. A main obstacle of the Suez Canal is that all of its water is controlled by Egypt, with no influence by other countries when it comes to operations.
It’s important to keep in mind that when it comes to world history, there are many events that are not always necessary for the creation of today’s modern world, but they are still part of history because they led up to present day. The canal itself was built in the mid 1800’s with no acknowledgement until much later.
The canal was built to help the economy of Egypt, but it has had a much larger impact on the world overall. It has become one of the most important shipping routes in the world, helping to transport goods throughout Asia and Europe. The Suez Canal is still under dispute, as there has been a lot of fighting over how it should be operated. However, its importance and impact on international trade cannot be ignored and as a result, we observe this canal as an important piece of history that we still use today.
The importance of the Suez Canal can no longer be ignored and in light of this, we must seek to understand what connects it to today’s world.
The Suez Canal Authority officially opened the new side channel in 2016, marking a decade in planning and construction. The project cost a total of USD 8.5 billion, and employs over 11,000 people directly and indirectly.
The company responsible for managing the canal is called the Suez Canal Economic Zone Authority (SCZ). In the past century, the canal has been at the center of regional conflict, which can be attributed to its importance as a main shipping route in international trade.
In 2015, when Egypt experienced political instability from military coup from Hosni Mubarak to Abdel Fattah el-Sisi, tourism in Egypt plummeted by 28%, which was a huge hit to SCZ’s revenue stream.
The companies that operate the canal use the revenue they receive from tolls to operate and maintain the waterway and its related infrastructure and operations. This is why it is so important to ensure that groups like SCZ don’t suffer from bankruptcy or conflict. Egypt is an important country for European countries to conduct their trade with, so it would be very negative for Europe if there was a large decrease in trade with Egypt.
The Suez Canal Authority currently operates six modernized locks on the sea-to-sea route, with another eight on the sea-to-sea link approaching completion at a rate of one per year. The new locks in both cases are part of the East Terminal Expansion Project, which is a joint effort between Suez Canal Company Limited and its parent company, the SCZ.
In September 2016 the new side channel officially opened which is designed to shorten the trip from Port Said to Port Tewfik by about 50 minutes per trip. In total, six new ships can now pass through this channel during each 24-hour period. The new side canal will reduce congestion on the main passage and will create “an optimal and more effective system for moving cargo”. The goal of this project was to construct a more efficient system with the goal of creating more space for ships and reducing time required to complete a transit.