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World Egypt's commerce reputation survives Suez blockage: analysts

13:05  31 march  2021
13:05  31 march  2021 Source:   afp.com

Ship blocks Suez Canal after 'gust of wind' knocks it off course

  Ship blocks Suez Canal after 'gust of wind' knocks it off course A giant container ship ran aground in the Suez Canal after a gust of wind blew it off course, the vessel's operator said Wednesday, bringing marine traffic to a halt along one of the world's busiest trade routes. "The container accidentally ran aground after a suspected gust of wind hit it," ship operator Evergreen Marine Corp told AFP. "The company has urged the shipowner to report the cause of the incident and has been in discussions with relevant parties including the canal management authority to assist the ship as soon as possible."Bloomberg reported it had caused a build-up of more than 100 ships seeking to transit the canal.

The near week-long shutdown of the Suez Canal threw an uncomfortable international spotlight on Egypt, but experts see limited overall fallout for its commercial shipping reputation.

a large ship in a body of water: Tugboats pull the Panama-flagged MV Ever Given to unobtrusive sanctuary after its stern and bow were successfully prised from the banks of the Suez Canal © - Tugboats pull the Panama-flagged MV Ever Given to unobtrusive sanctuary after its stern and bow were successfully prised from the banks of the Suez Canal

The accident, in which a 200,000-tonne container vessel became wedged diagonally across the canal during a sandstorm, blocked a crucial shipping artery used for 10 percent or more of world trade.

But fears that it could take weeks to refloat the behemoth proved unfounded.

Ship blocking Suez Canal prompts flood of memes

  Ship blocking Suez Canal prompts flood of memes Days into the saga, Twitter users decided the vessel blockage was the perfect encapsulation of the past two years. Tapping into the zeitgeist of the past few months, a photograph of a pair of construction workers surveying the ship was captioned “mindfulness” while text above the wedged vessel read: “My anxiety from all the death and COVID.” Another tweet captioned an image of the Ever Given as “My COVID depression & anxiety” while next to the vessel, a bulldozer dwarfed by the ship was captioned “Going on a daily walk”. Procrastination was another popular theme.

Six days into the crisis, after major operations involving a flotilla of tug boats and excavators dredging up sand, the Japanese-owned MV Ever Given was freed and taken to an unobtrusive anchorage.

Egypt's Suez Canal Authority was quick to claim credit.

"Anywhere else in the world, this operation would have taken three months," boasted canal chief Osama Rabie, adding that "99 percent" of personnel working at the scene had been Egyptian.

Visibly relieved, he said he had been told by President Abdel Fattah Al-Sisi that "the reputation of Egypt rested on my shoulders".

Sisi, who deposed Islamist president Mohamed Morsi in 2013, spent over $8 billion to widen and add a 35 kilometre (21 mile) second lane on a northern segment of the canal amid much pomp six years ago.

Tugs and dredgers try to free megaship blocking Suez Canal

  Tugs and dredgers try to free megaship blocking Suez Canal Tugboats and dredgers were working Friday to free a giant container ship blocking Egypt's Suez Canal for a fourth day, forcing companies to re-route services from the vital shipping lane around Africa. The MV Ever Given, which is longer than four football fields, has been wedged diagonally across the entire canal since Tuesday, shutting the waterway in both directions. The blockage has caused a huge traffic jam for more than 200 ships at either end of the 193-kilometre (120-mile) long canal and major delays in the delivery of oil and other products.

The country has emerged from the short crisis with credit, said Tony Munoz, editor-in-chief at trade publication Maritime Executive.

"The Egyptian government handled the blockage and closure of the critical trade lane exceptionally well, considering the intense international pressure," Munoz told AFP.

- 'A big one' -

However, Munoz also pointed to the significant role played by the international salvage specialists who worked alongside Egyptian personnel.

a large ship in a body of water: A ship on its way near Egypt's Suez Canal on March 30, 2021, a day after passage of the waterway was made possible once more by the dislodging of a giant container ship © Tarek WAJEH A ship on its way near Egypt's Suez Canal on March 30, 2021, a day after passage of the waterway was made possible once more by the dislodging of a giant container ship

Munoz cited in particular the crisis management expertise provided by Resolve Marine's Captain Nick Sloane, who was also salvage master for the clear-up of the 2012 Costa Concordia cruise ship disaster off Italy.

Another expert likewise said international help was crucial.

Tugs, dredgers continue work to refloat ship blocking Suez Canal

  Tugs, dredgers continue work to refloat ship blocking Suez Canal Egypt’s president orders preparations for the possible removal of some of ship’s cargo as teams struggle to free it.Dredgers working to dislodge the stranded vessel have so far shifted 27,000 cubic metres of sand, to a depth of 18 metres, and efforts would continue around the clock according to wind conditions and tides, the Suez Canal Authority (SCA) said in a statement.

"There was bound to be some domestic flag-waving about the success of the refloating... but it does not diminish the Dutch involvement," said Angus Blair of the American University in Cairo, referring to Dutch firm Smit Salvage.

a large ship in a body of water: Egyptian coast guards patrol as a ship navigates the newly reopened Suez Canal after a near week-long blockage © Tarek WAJEH Egyptian coast guards patrol as a ship navigates the newly reopened Suez Canal after a near week-long blockage

Both Blair and Munoz saw little or no impact from the canal blockage on Egypt's share of shipping cargo traffic over the medium-term.

"In essence, this was only a traffic accident -- (albeit) a big one," said Blair.

"Airports have accidents, but within hours to a day the airport will reopen and then there is an investigation to determine the cause," he added. "So, I do not think there is damage to Egypt's reputation".

Munoz noted that "the alternative of sailing around Africa is not reasonable", emphasising that the whole "purpose of these mega-boxships is to reduce port calls and operational costs".

- 'Reputational damage' -

But Yezid Sayigh, a senior fellow at the Carnegie Middle East Center, noted that "when oil prices drop below a certain level, the longer route around the Cape of Good Hope becomes cheaper", referring to the route around southern Africa.

of tea, IKEA furniture, sheep and oil: the prevention inventory of the cargoes blocked in the Suez

 of tea, IKEA furniture, sheep and oil: the prevention inventory of the cargoes blocked in the Suez canal © Ahmed Shaker in the Suez Canal, totally blocked since Tuesday, the wait extends On board the nearly 400 vessels supposed to take the maritime road. "I told one of my clients that his floor blocked the Suez Canal, he did not believe me." The formula rocket Saturday on the BBC, signed by the boss of a British company specializing in the wood. A cargo of French oak parquet blades in China is located on the Ever Given, the ship of 200,000 tonnes that blocks the Suez channel since Tuesday .

An expert on the enormous economic sway of Egypt's military, Sayigh has long seen the costly 2014-15 expansion of the canal as ill-judged.

In a 2019 study, he noted that "Sisi's demand that it be completed within one year rather than the three years it was estimated to require" contributed to the cost of the project more than doubling from initial estimates.

Abdel Fattah el-Sisi wearing a suit and tie: Egypt's President Abdelfattah al-Sisi at a ceremony for the opening of a second lane and widening of the Suez Canal in August 2015, a project that cost over $8 billion © KHALED DESOUKI Egypt's President Abdelfattah al-Sisi at a ceremony for the opening of a second lane and widening of the Suez Canal in August 2015, a project that cost over $8 billion

The 2014-15 expansion was driven by overly optimistic shipping traffic projections, amid competition for some Asia-Europe cargo traffic from the Panama canal and Arctic shipping route, he told AFP.

The blockage of the canal caused tailbacks stretching to hundreds of cargo ships at the northern and southern entrances © Mahmoud KHALED The blockage of the canal caused tailbacks stretching to hundreds of cargo ships at the northern and southern entrances

The Suez Canal earned Egypt just over $5.7 billion in 2019/20, little changed from the year before, and similar to the $5.3 billion in revenues earned back in 2014.

But the expansion project had anticipated annual transit fees would hit $13.5 billion by 2023.

Faced with this disappointing balance sheet, even Sisi was quick this week to rule out a costly widening of the southern section of the canal where the Ever Given got stuck.

While the immediate shipping traffic jams should clear before the end of the week, apportioning responsibility for losses suffered by the numerous parties is likely to play out through litigation, according to credit ratings agency DBRS Morningstar.

That could ensure uncomfortable scrutiny of Egypt extends well beyond the canal blockage.

"Egypt has resisted transparency" over a number of incidents, including "the murder of Italian PhD student Giulio Regeni in 2016," noted Sayigh.

Regeni was researching Egyptian trade unions when he was abducted in January 2016; his mutilated body was found on Cairo's outskirts, and Italian prosecutors want to put four Egyptian security officers on trial for the killing.

When it comes to the Suez probe, Egyptian authorities "would be well advised to be very transparent in this instance so as to avoid further reputational damage," Sayigh told AFP.

bur/dwo/pjm/fz

'I was blamed for blocking the Suez Canal' .
Egypt's pioneering ship captain has been targeted over false rumours about her role in the incident.News had broken about a huge container ship, the Ever Given, that had become wedged across the Suez Canal, bringing one of world's major shipping routes to a halt.

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This is interesting!