Houthi Attacks Trigger Crisis in Suez Canal, Impacting Egypt's Economy
Egypt's Suez Canal, a pivotal trade route, is facing a severe crisis due to a spate of attacks by Yemen's Houthi rebels. Since late 2023, approximately 250 maritime assaults have disrupted traffic, leading to a dramatic decline in ship passage. Previously accommodating an average of 72 vessels daily, the canal saw this number plummet to just 27 by the end of December 2023, resulting in a cargo reduction of nearly 75%.
As a consequence, revenue from the canal has reportedly dropped by about 60%, causing an estimated loss of $7 billion for Egypt in 2024. The minister of foreign affairs confirmed the dire implications for public finances, pointing to a current account deficit exceeding $20 billion, worsened by the Suez Canal revenue decline.
Despite looking to the past for solutions, as the canal has weathered numerous crises since its opening over 150 years ago, authorities maintain a confident outlook for future expansions. They argue that the canal's strategic significance between Asia and Europe cannot be replicated, and plans are underway for further enhancements to ensure operational efficiency once current disruptions cease.
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