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Suez Canal: How Egypt Is Helping To Curb Somali Piracy Threat

Posted on the 03 July 2013 by Adeyemiadisa @adeyemiadisa

Suez Canal: How Egypt Is Helping To Curb Somali Piracy ThreatIn terms of international trade, the Suez Canal is arguably one of the most important waterways in the world.

Suez Canal tolls paid by vessels of all sizes and tonnage passing through it provides an important source of much-needed revenue for the Egyptian government.

This artificial sea-level waterway, which runs north to south across the Isthmus of Suez in Egypt to connect the Mediterranean Sea and the Red Sea, provides shipping with the fastest access from the Atlantic Ocean to the Indian Ocean, and vice versa.

Suez Canal And International Treaty

Such is the importance of the Suez Canal that it is protected by an international treaty, the Constantinople Convention of the Suez Canal (1888).

The treaty, which says the “Suez Maritime Canal shall always be free and open, in time of war as in time of peace, to every vessel of commerce or of war, without distinction of flag.”

Thus companies dependent on the import and export of goods between European and Asian markets can have complete confidence the Suez Canal will always be open for business, even despite the uncertainties caused by the economic and political difficulties which Egypt is facing at the moment.

International Trade And Somali Piracy Threat

Piracy, too, has been a cause for concern in the wider region and has meant increasing costs in terms of security. However, Egypt has been playing a major part in helping curb the piracy threat emanating out of Somalia, especially through active monitoring and collecting of information.

The SCA is the body charged with running and managing the canal. In a fascinating interview conducted by the Oxford Business Group (OBG) last year, Ahmed Ali Fadel, the former chairman of the Suez Canal Authority (SCA), said traffic through the canal was growing in spite of the piracy threat.

He said, “Approximately 20,000 ships cross the Gulf of Aden or pass by the Somali coast every year. This region accommodates all the trade traffic between Asia, the Persian Gulf, Europe and the east coast of the US, and in spite of the sporadic piracy, traffic through the Suez Canal has been growing.

“The number of ships that were kidnapped off the Somali coast and Gulf of Aden fell from 49 ships in 2010 to 27 ships in 2011; the latter represents only 0.2% of the 17,799 ships in transit around the region in 2011.”

And he added, “Egypt is playing an important political role in the compromise between the conflicting forces in Somalia in an effort to reduce the impact of piracy.

Premium Charges

The SCA, alongside the Ministry of Foreign Affairs, monitors acts of piracy and an action group within the SCA collects information in real time on acts of piracy, so that appropriate measures can be taken.

“However, this has its costs. Premium charges have been raised on ships that pass through the region and the fees involved in hiring security forces to protect ships in this area have increased as well.”

Statistics released by the SCA for the first three months of 2013 show that there has been a 9.6 percent decrease in the number of vessels using the canal compared to the same period last year.

This resulted in a fall in net tonnage of 5.4 percent. However, there was an increase of three flags, to 83, topped by Panama, Liberia and the Marshall Islands.

Read the full OBG report here

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