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2017 to witness start of Suez Canal logistics projects implementation

Head of the Suez Canal Authority, Mohab Mamish, said that the implementation of development plans of the Suez Canal operating system will be underway in 2017. Coupled with the expansion works carried out by the authority, the developments will result in higher revenues.

Mamish stated that economic studies conducted by the authority since the second quarter of 2016 display improvements in the trade movement. The trade movement is expected to grow throughout 2017, especially from southeast and south Asia.

The Suez Canal also witnessed an annual growth rate of 4%, reaching $3.2bn from the beginning of 2016 to 6 August.

He pointed out that the Suez Canal Authority is also working on attracting shipping lines that compete with the Panama Canal and the Cape of Good Hope, especially with the decrease in oil prices. That is why the authority decided to offer discounts to long-haul shipping lines.

Mamish added that the authority operates in the highly competitive international services market. It has to keep up with the movement of global trade developments. He explains that marketing offers have been able to attract good ships, starting from Kuwaiti oil tankers to ships subsidiary to global navigation CMA MSC.

The Suez Canal Authority offered four discounts to ships passing through the canal this year. It also reduced the transit fees for oil tankers that transport 200,000 tonnes or more. The fees decreased by 20-45% during the tankers’ return from the ports of the northern coast of South America, the Gulf of Mexico, and the Caribbean Sea to the Gulf region.

Discounts also included reducing fees by 30% to ships coming from the United States (US) east coast to south and southeast Asia, and then to between 45-65%.

Additionally, crossing fees went from $560,000 to $385,000 for giant oil tankers that transfer more than 250,000 tonnes and pass through the Suez Canal and Suez-Mediterranean (SUMED) pipeline to transport oil from the Persian Gulf to the US Gulf and the Caribbean.

On the other hand, Mamish confirmed that value-added projects will be implemented next year, in order to control the world trade’s impact on the canal.

At the top of these projects lies the establishment of an arsenal in Adabiya port to manufacture ships in partnership with the Armed Forces’ National Service Projects Authority (NSPA), said Mamish.

He stressed that the authority will follow the same methodology applied in the implementation of the new Suez Canal. The authority is now working on launching a tender to select a global consultancy office that specialises in the evaluation of financial and technical studies, and the establishment of logistics projects. This will be followed by another international tender to select a technical partner that has an experience in shipbuilding technology.

Mamish predicted that one of the Asian companies operating in south or southeast Asia will win the tender, given the shipbuilding experience of countries in these two regions. He pointed out that three parties will implement the project, namely the Ministry of Defence as a landowner, the Suez Canal Authority as a funder, and the selected foreign technical partner.

Mamish added that the authority is reviewing some Arab and foreign offers it had received for the implementation of a ship fuel station. He pointed out that by next year, the project will be crystalised and ready to implement, as it is considered a vital factor in the Suez Canal’s economic development. The station will provide logistical services to ships, such as food, water, and other services.

He continued that the authority is working on providing passing ships with speedboats and lighting in order to facilitate and ease their entrance, as well as linking ships to Suez, Port Said, Nuweiba and Sharm El-Sheikh ports.

Source: dailynewsegypt
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