The Suez Canal is one of the most frequently used routes in the world. It is also the boundary line between Asia and Africa, and the main passage for people from Asia to Africa and Europe. Recently, the Suez Canal encountered a big congestion, what happened to the Suez Canal? What are the consequences of the Suez Canal? Specifically will lead to these three major consequences!
What happened to Suez's aground cargo ship?
On March 23, Taiwan's Evergreen Marine Cargo Ship "Chang Ci" had an accident while passing through the Suez Canal. The cargo ship was stuck in the river course. Two-way traffic on the waterway was severely congested, and nearly 100 ships were affected. According to reports, the stranded cargo ship is 400 meters long and is one of the largest cargo ships in the world. Evergreen Group stated that the suspected cause of the accident was that the ship was hit by strong winds and deviated.
According to a local media report on March 25, Osama Rabbi, chairman of the Egyptian Suez Canal Authority, announced on the same day that the passage of ships in the canal will be temporarily suspended from this Thursday until the stranded giant Panamanian freighter EVER GIVEN has completed its shedding.
The Suez Canal Authority stated that extreme weather such as strong winds caused the freighter to run aground. The person responsible for the technical management of the vessel said that there were no casualties in the accident, and no water pollution occurred. The cause of the accident is still under investigation.
What are the consequences of the traffic jam on the Suez Canal?
Consequence 1: Loss up to 400 million U.S. dollars per hour
The Suez Canal connects the Mediterranean Sea and the Red Sea. It is located at the critical point of the intercontinental belt of Europe, Asia, and Africa. About 12% of world trade is transported through the canal. According to the Suez Canal Authority, nearly 19,000 ships will pass through the canal in 2020. About 50 ships per day. The Suez Canal’s “Great Cypriot Ship” lost as much as US$400 million (about 2.6 billion yuan) per hour.
Consequence 2: International oil prices rise
The income from the canal is one of the main sources of Egypt’s fiscal revenue and foreign exchange reserves, which will lead to an increase in international oil prices.
Consequence 3: It has a huge impact on global trade
7% of the world's maritime trade flows through the Suez Canal, of which 35% are the ports along the Red Sea and the Persian Gulf, 20% are ports in India and Southeast Asia, and 39% are in the Far East. Has a huge impact on global trade.