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Egypt's Suez Canal revenues 'driven down by slowing global economy'

Despite the opening of the Suez Canal expansion, revenues from the watercourse dropped in August relative to the previous year

Ahram Online , Sunday 18 Oct 2015
The New Suez Canal
A cargo ship is seen crossing through the New Suez Canal, Ismailia, Egypt, July 29, 2015 (Reuters)
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The ongoing slow down in the global economy has driven down revenues from the Suez Canal, one of Egypt's main sources of foreign currency, head of the Suez Canal Authority, Mohab Mamish, told business daily Al-Borsa Sunday.

Revenues from the canal dropped 9.4 percent in August to $462.1 million, from $510 million in the same period in 2014, after the opening of the Suez Canal expansion.

In August, President Abdel-Fattah El-Sisi opened a new shipping route in the canal as part of his programme to boost the Egyptian economy through mega projects.

However, a slowing global economy was further hampered by worries of falling global consumption of oil and a slowing down in China, the world's second largest economy.

The global slow down is expected to hit emerging markets on the back of falling commodity prices, prolonging the crisis.

The Suez Canal Authority is preparing a detailed report on the exact causes for the drop in revenues, Mamish was quoted as saying by Al-Borsa.

Egypt's net foreign reserves dropped for the third consecutive month to $16.335 billion at the end of September.

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Tim
18-10-2015 08:46pm
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Was there a feasibility study for this project?
Was this drop in revenue is as expected in the feasibility study of the Canal expansion project? some suggested that Egypt did make any feasibility study before starting digging for the Canal expansion project.
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Neo
18-10-2015 04:18pm
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One trick pony
A country can’t build the entire economy based on one tired sector. The canal had its glory days, and will continue to serve as a slice of an economy, but new sectors need to be build fast. Stop wasting billions on useless military gear and start building an economy. If you can’t, step aside and get international experts to show you the way. Yet another mediocre cabinet!
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Sam Enslow
18-10-2015 03:15pm
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Alternative routes
Large ships are finding it more profitable to go 'round the Cape. Also the opening of the Northern Passage (due to climate change) has increased some four fold over the last three years and that traffic is expected to increase.
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