Egypt’s Suez Canal Authority recently issued a statement stating that it will increase ship tolls in the Suez Canal, one of the world’s most important waterways, in January 2023.
The statement said that from January next year, tolls for cruise ships and ships transporting dry bulk cargo will be increased by 10%, and tolls for other ships will be increased by 15%.
The head of the authority, Osama Rabie, said the toll increase, which will take effect on January 1, is “inevitable and necessary”. He blamed high global inflation, which has increased the cost of waterway operations, maintenance and maritime services.
CNBC Arabia TV channel recently quoted Osama Rabie, chairman of the canal authority, as saying that the Suez Canal expects its revenue to increase by $700 million per year after a 15% increase in tolls in 2023.
The Suez Canal is located at the junction of Europe, Asia and Africa, connecting the Red Sea and the Mediterranean.
Revenue from the canal is one of Egypt’s main sources of national fiscal revenue and foreign exchange reserves. Egypt currently faces huge economic challenges and insufficient foreign currency to purchase essential goods such as food and fuel.
Data shows that 10% of cargo ships in global trade, including 7% of oil tankers, pass through the Suez Canal.
The number of ships passing through the Suez Canal in 2021 increased by 10% year-on-year to 20,694. The total tonnage of passing ships was 1.27 billion tons, and toll revenue reached US$6.3 billion, an increase of 12.8% over 2020, which is the highest in history since the Suez Canal opened. level.
It is worth noting that Suez Canal tolls have been raised several times before:
In early March, it announced a fee increase; on March 22, Egypt once again announced that it would increase transit fees for ships passing through the Suez Canal from May 1, including transit fees for oil tankers.
This is the third increase in transit fees announced after two increases were announced in early March.
On March 1 this year, the administration increased tolls for some ships. Among them, the tolls for liquefied petroleum gas ships, chemical carriers and other liquid cargo ships will increase by 10%; the tolls for vehicle and natural gas carriers, general cargo ships and multi-purpose ships will increase by 7%; the tolls for oil tankers, crude oil tankers and dry bulk carriers will increase by 7%. Increased by 5%.
In an announcement of the fee increase on March 22, the Suez Canal Authority said on its website that it would increase normal transit fees for tankers carrying oil and petroleum products by 15%, up from the current 5%.
The surcharge for chemical tankers and other liquid bulk carriers will increase from 10% to 20%,
The surcharge for fully loaded and ballasted dry bulk carriers will increase to 10%.
Vessels carrying vehicles, general cargo and heavy lift vessels and multi-purpose vessels will grow from 7% to 14%.
Ballasted crude oil and petroleum product tankers transiting the canal will still have to pay a 5% surcharge on normal transit fees.
Regarding the latest fee increase announced on September 17, the Authority stated that the new price increase was a revision of the increase in vessel surcharges in March.
But the canal authority also stated that “these surcharges are temporary and can be modified or canceled based on market conditions in the shipping industry.”
According to relevant personnel, in response to the possible impact of the Russia-Ukraine conflict on global shipping, the Administration is studying necessary plans to maintain revenue, including providing protection for existing customers, attracting more customers, and following up on technological developments.
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