Suez Canal fees rise nearly three percent, says authority

ISMAILIYA: Transit fees for ships using Egypt s Suez Canal increased on Sunday by an average of nearly three percent, the canal authority said, in the second such increase in a year. Director of Public Relations Mohammed Moussa told AFP that the change took effect at midnight, as originally announced by the authority in December. Fees rose 3.5 percent for cargo ships, 3.73 percent for oil tankers and only 1.14 percent for passenger liners. Other types of ships, including naval vessels, had a 2.84 percent increase. The authority, which has run the canal since its nationalization in 1956, last raised fees in March 2006, also by three percent. The last fee increase contributed to the canal s massive revenues of $3.82 billion in 2006, up from $3.4 billion the previous year, a number expected to increase in 2007 with a forecast 7.6 percent rise in global trade, largely driven by India and China. Currently, some 7.5 percent of the world s trade passes through the canal. Egypt is in talks with China to ensure that close to 100 percent of Chinese exports to Europe pass through the Suez Canal – up from the current 60 percent – in exchange for lower transit fees. High energy prices also allow for higher canal fees since the short cut between the continents save cargo ships large amounts of fuel and traveling time. The canal is still too small, however, for the largest long-haul cargo and oil freighters. The Suez Canal, which opened in 1869, is Egypt s third largest source of revenue, after tourism and remittances from expatriate workers.