Will Iranian sea corridor compete with Suez Canal? The Iranian Chabahar Free Trade Zone Organization announced July 5 that trade connections to Mumbai, Hamburg and St. Petersburg will be made through Astrakhan (in Russia), Anzali and Chabahar (in Iran) and Nhava Sheva (in India) instead of the Suez Canal. This raises questions about the impact the move will have on the revenues generated by the Egyptian canal, a key source in an economy that has been deeply suffering from the coronavirus pandemic.
The 193-kilometer (120-mile) Suez Canal is a major source of foreign currency for Egypt and one of the pillars of the national economy. It is considered the fastest maritime shipping corridor in the world due to its geographical location and ability to cut travel time between Asia and Europe by an average of 15 days.
The canal revenues declined in May by about 9.6% year-over-year due to the coronavirus repercussions on global trade.
Suez Canal Authority (SCA) chairman Osama Rabie said in media statements July 4 that canal revenues amounted to $5.72 billion in the fiscal year 2019-2020 compared to $5.75 billion last year, marking a decrease of $32.1 billion due to coronavirus implications, which reduced global trade by 18%. Rabie said that new marketing policies adopted by the SCA to attract and organize navigation traffic played a positive role in the generated revenues.
SCA spokesman George Safwat told Al-Monitor over the phone that the idea of the Iranian international transport corridor dates back to 2000 when Iran, Russia and India signed a joint agreement to start establishing a transport route that includes maritime, land and rail transport lines. The route, he said, aims to transport goods and shipments from India and Iran to countries surrounding the Caspian Sea, and from there to Russia and Germany and vice versa over a distance of 7,500 kilometers (4,660 miles). Read More