New Suez Canal The
New Suez Canal ( '''') is an artificial waterway project in Egypt which created a second shipping lane along part of the
Suez Canal, and deepened and widened other stretches. The project was inaugurated by the Chairman of the
Suez Canal Authority Mohab Mamish in the presence of
Egyptian President Abdel Fattah el-Sisi on 5 August 2014. The new canal opened one year later in a ceremony attended by several international dignitaries including the then French President
François Hollande. The New Suez Canal is expected to expand trade along the fastest shipping route between Europe and Asia. The new canal allows ships to sail in both directions at the same time. This decreases transit time from 18 to 11 hours for most ships. The expansion is expected to double the capacity of the Suez Canal from 49 to 97 ships a day. The construction, which was scheduled to take three years, was instead ordered by the President to be completed in a year. The chairman of the Suez Canal Authority announced that the revenues from the Suez Canal (after the completion of the New Suez Canal) will jump from 5 billion dollars to 12.5 billion dollars annually. The Egyptian government said that these revenues will be used to transform the cities along the Canal (
Ismaïlia,
Suez, and
Port Said) into international trading centers. The government has also said that many new projects in the
Suez province are being studied as a result of enlarging the Suez Canal capacity, such as building a new industrial zone,
fish farms, and the completion of the Valley of Technology (wadi al thechnologia). The project cost around 30 billion Egyptian pounds (approximately 4.2 billion dollars) and no foreign investors were allowed to invest in the project, but rather Egyptians were urged to participate in funding the project through bank certificates of deposit initially yielding 12%, later raised to 15.5%. The
Egyptian Armed Forces participated in the project by helping in digging and designing the canal. The enlarged capacity allows ships to sail in both directions at the same time over much of the canal's length. Beforehand, much of the canal was only one shipping lane wide, with limited wider basins for passing. This is expected to decrease waiting time from 11 hours to 3 hours for most ships, and to increase the capacity of the Suez Canal from 49 to 97 ships a day.
Progress Technical difficulties initially arose, such as the flooding of the new canal through seepage from the existing canal. Nevertheless, work on the New Suez Canal was completed in July 2015. The channel was officially inaugurated with a ceremony attended by foreign leaders and featuring military
flypasts on 6 August 2015, in accordance with the budgets laid out for the project.
Benefits, costs, and risks Egyptian officials, especially the chairman of the
Suez Canal Authority,
Vice-Admiral Mohab Mamish, stated that the $8.2 billion project, which expands capacity to 97 ships per day, will more than double annual revenues to some $13.5 billion by 2023. That, however, would require yearly growth of 10%. A recent forecast from the
IMF suggests that in the decade up to 2016 the annual rate of growth for global merchandise trade will have averaged 3.4%. About 18 scientists writing in the academic journal
Biological Invasions in 2014 expressed concern about the project impacting the
biodiversity and the
ecosystem services of the
Mediterranean Sea. They called on Egypt to assess the environmental effects that the canal expansion could cause, a request echoed by the executive secretary of the
Convention on Biological Diversity. Over 1,000 invasive species have entered the Mediterranean Sea through the Suez Canal since its original construction in the mid-19th century, with human activities becoming a leading cause of the decline of the sea's biodiversity, according to the
European Commission's
Joint Research Centre. Initially, the project was to be financed through a stock market
IPO, allowing partial private ownership of the project. However, the government quickly changed its financing strategy, relying on interest-bearing investment certificates that do not confer any ownership rights to investors. The certificates were issued by the Suez Canal Authority with an interest rate of 12%.
Revenues The government blocked access to the official revenues reports for three months after the opening. It then published two reports for August and September, which showed consecutive decreases in the total Suez Canal revenues by 10% or $150 million.
Seven new tunnels In 2014, the former chairman of the Suez Canal Authority,
Mohab Mamish, announced that seven new tunnels will be dug to connect the
Sinai Peninsula to the Egyptian homeland. Three tunnels will be dug in
Port Said (two for cars and one for railways) and four will be dug in
Ismaïlia (two for cars, one for railways, and one for other special uses). The tunnels will cost 4.2 billion dollars (approximately about 30 billion Egyptian pounds). The first three tunnels will cost 18 billion Egyptian pounds and
Arab Contractors and
Orascom are the builders for this project.
Floating bridge The Al-Nasr floating bridge to enable easy travel between
Port Said and
Port Fouad was built successfully and inaugurated in late 2016. The bridge extends from opposite banks, with the help of tugboats that push both parts until they connect to form a bridge that can be traversed by cars. It is long. This was an important step towards the efficient movement of equipment and manpower.
Technology Valley The technology valley is an ongoing project that was paused for 17 years and now the government announced plans to continue the project. The project's location lies on the eastern part of
Ismaïlia city and consists of four stages: the first stage covers , the second stage covers , the third stage covers , and the fourth stage covers . However, when the project started it completed only 108 acres and then was put on hold. The completed technology valley will be the first step in starting
Egypt's electronics industry for manufacturing technological devices.
Industrial Zone The industrial zone project will cover 910 acres of land northwest of the Gulf of Suez. The first stage of the project covers 132 acres and it is done for 20 million Egyptian pounds. The second stage is 132 acres and it is not yet done. Currently, 23 factories are operating and 56 are still under construction. Upon finishing the project it will provide 9386 work opportunities. The chairman of the Suez Canal authority also said that shipyards and services will be built along the Suez Canal corridor which includes: catering and services center for ships, a ship manufacturing and repair center, a center for manufacturing and repairing containers, and logistic redistribution centers.
New Ismailia City This project will create "New Ismailia City", which will cover 16,500 acres of land. This new city will be created to accommodate approximately 500,000
Egyptians to relieve the pressure from the crowded towns of Cairo and the delta cities. The location of this city is designed to accommodate the workers of the nearby Wadi Al-thechnologia (Technology Valley) which will be built in the following years.
Fish Farming Under the National Project for Fish Farming, new fish farms were built on the eastern side of the Suez Canal. The project includes twenty-three tanks that cover 120 square km with a depth of 3-5m. It covers the area from southern Tafrea to the Gulf of Suez. This project is designed to produce high-quality fish for food.
Russian Industrial Zone During a state visit to
Russia in 2014, President Sisi said that he had agreed with his Russian counterpart President
Vladimir Putin to establish a Russian industrial zone in the new project. In May 2018, Egypt and Russia signed a 50-year agreement to construct the new industrial zone. ==Developing Existing Ports==