The Suez Canal Authority chairman confirmed transit tolls would remain steady in 2010 for the second straight year, but said he expected 2.4 percent growth in the strategic waterway's revenues this year.
The Suez Canal Authority chairman confirmed transit tolls would remain steady in 2010 for the second straight year, but said he expected 2.4 percent growth in the strategic waterway's revenues this year. He said that although canal revenues had decreased by 20 percent in 2009 due to battered trade volumes during the global economic slowdown, piracy off the Gulf of Aden had little impact on the waterway that is a barometer for trade worldwide.
The global shipping industry, also hit by tight financing, is gearing up for a second year of turmoil in 2010. Industry watchers estimate as much as 15 percent of the world's shipping fleet could end up out of commission in 2010.
"To support global trade movement and (help) shipping companies overcome this (financial crisis), we have decided to keep the tolls steady," Fadel told the news conference.
Canal sources had said in December that the tolls for the canal, one of Egypt's main foreign currency earners, would stay on hold due to the fallout from the global financial crisis.
Fadel told reporters on Tuesday in Ismailia, on the banks of the canal, the authority could not consider reviewing tolls depending on fuel prices alone, but also on the recovery of the global economy and how shipping fares.
"Petrol is not the only factor. There are many there are other factors such as ... economic growth, inflation, how maritime trade routes are moving," he said.
He said canal revenues in 2009 were $4.291 billion, some 20 percent lower than $5.381 billion in 2008. The number of vessels passing through the canal in 2009 was 17,228, also about 20 percent down on the 2008 figure of 21,415.
"The effects of the global financial crisis are still facing the world and imposing difficult challenges. It is slowing recovery as growth in trade ... has not reached the level indicating a true revival for the global economy," he said.
Revenue from the canal fell 0.5 percent to $390 million in December, the smallest year-on-year fall since November 2008, when faltering global trade began to hit shipping traffic.
Hundreds of empty container ships, bulk carrier and others -- so-called "ghost ships" -- were idled in deep sea ports in Asia and Europe during 2009 following the slump in freight as the global crisis caused world trade to plunge.
Doubts remain about whether the economic revival is sustainable once governments and central banks curb the flow of easy money they have been pumping in to stimulate economies, but some believe trade will hold up thanks to strength in emerging markets.
Pirate attacks off the coast of Somalia have fanned industry fears that insurance and shipping costs could be driven higher and force companies to use long sea routes, further denting prospects for growth.
Piracy has flourished in the Gulf of Aden and Indian Ocean shipping lanes and seaborne gangs have seized several cargo ships, collecting tens of millions of dollars in ransom. But Fadel said it had had minimal impact on Suez operations.
He said the fall in revenues last year was "90 percent from the financial crisis and 10 percent from piracy".
"If you look at the ships that were attacked ... they were caught on the Kenyan shores ... They have no relation to ships heading to the Suez canal," he said.