Head of the Suez Canal Authority: Houthi attacks have caused a major crisis and significant financial losses for Egypt.
Arabian Sea Newspaper - Special
Arabian Sea – Yemen – Special: The Chairman of the Suez Canal Authority, Lieutenant General Osama Rabie, warned that the global shipping lane is facing a "major crisis" due to the escalating Houthi attacks on commercial ships in the Red Sea since late 2023, stressing that traffic through the canal has declined to about half, causing severe financial losses to the Egyptian economy. In statements to Asharq Al-Awsat newspaper, Rabie explained that the average number of ships passing daily has decreased to between 30 and 35 ships, compared to more than 65 ships before the attacks began. The canal's revenues also recorded a 61% decline during the first half of 2024, reaching $3.9 billion, compared to $10.2 billion in 2023. He pointed out that the number of ships that have crossed the canal since the beginning of the year has not exceeded 13,213 ships, compared to 26,434 ships last year, noting that the deteriorating security situation in the Red Sea, especially after the Houthis targeted ships, has prompted many international shipping companies to take the Cape of Good Hope route as an alternative, despite its high cost and long duration. Despite the continued threats and escalating international pressure, Rabie stressed that Egypt refuses to engage in military alliances against the Houthi group, stressing that "Yemen is a brotherly Arab country, and Egypt does not pursue a policy of participating in military operations against Arab countries." Rabie explained that the stability of the situation in the Gaza Strip will be a decisive factor in calming the situation in the Red Sea, adding that shipping companies have expressed their immediate readiness to resume transit through the canal as soon as stability returns, given the competitive advantages that the Suez Canal provides, which are difficult to compensate for. To counter the decline in maritime traffic, the Authority announced incentives and discounts on transit fees of up to 15% for specific categories of ships, but Rabie acknowledged that the continuation of attacks and high insurance costs keep many ships on alternative routes. The Chairman of the Authority said: "We are doing everything we can, but until security is achieved, we are fighting a difficult battle." It is noteworthy that the Houthi militia, backed by Iran, began in November 2023 a series of attacks with drones and missiles targeting commercial ships in the Red Sea and the Gulf of Aden, claiming to support Palestine in the face of Israeli aggression against Gaza. While the attacks were mainly targeting ships linked to Israel, they later expanded to include ships belonging to countries allied with the United States. These attacks have led to severe disruption of maritime traffic through one of the most important strategic passages in the world, and have prompted many shipping companies to change their routes through the Atlantic Ocean and the Cape of Good Hope route, which has directly affected the revenues of the Suez Canal, one of the most important sources of foreign currency in Egypt. This decline comes at a time when Egypt is facing increasing economic pressures, including the devaluation of the pound and rising inflation rates, making the losses of the Suez Canal an additional blow to the country's economic stability.
