CAIRO -

Last Tuesday, the Egyptian Suez Canal Authority began implementing a decision to impose additional fees on crude oil tankers and oil derivatives transiting the shipping lane in both directions by 5%, in addition to increasing transit fees for "loaded and empty" liquefied gas tankers by 10%.

The Suez Canal Authority announced an increase in fees for crossing the shipping lane, starting from the first of this March, just two days after the start of the Russian-Ukrainian war.

The authority said, in an official statement, that the latest decision is in line with the remarkable growth in global trade, the improvement of the economies of ships, the development of the shipping course and the transit service provided by the canal administration.

This comes a few days after the Suez Canal topped the list of the most corrupt and bribery shipping lanes during the period from 2011 to 2020, according to a report issued by the Maritime Anti-Corruption Network (MACN).

And last February, the canal’s navigation traffic achieved unprecedented performance rates, which government officials described as the highest compared to the same month over successive years throughout the waterway’s history.

increase again

The announcement of a new increase in the canal transit fees comes less than one month after the implementation of new tariffs for transiting ships, starting in early February.

The authority announced an increase in transit fees for all types of ships by 6% compared to what it was during 2021, and the decision excluded cruise ships and LNG carriers.

In front of that, the channel's revenue increased by 15.1% in February, to reach $545.5 million (not including navigation services), compared to $474.1 million during the same month last year, a difference of $71.4 million.

The authority stated, in a statement, that the navigation traffic in the canal during the past month recorded new and unprecedented records in terms of vessel transit rates and net tonnage, with 1,713 vessels crossing with a total net tonnage of 100.1 million tons.

In turn, the head of the Suez Canal Authority, Osama Rabie, said that the Egyptian shipping lane has no competitor in the world because it is the shortest distance and the safest, according to his description.

He explained, during a telephone interview with the "On My Responsibility" program broadcast on the "Echo of the Country" satellite channel, days before the outbreak of the Russian-Ukrainian war, that there was an improvement in maritime transport during 2021 compared to 2020, which led to more than 6.3 billion dollars in revenue. Over the past year, the largest return in the history of the channel.

Regarding the channel’s plans during Russia’s current war on Ukraine, Rabie affirmed the readiness of the channel’s administration for specific plans to avoid any losses that may occur as a result of the conflict, referring to the way it was dealt with during the Corona pandemic, where several incentives and discounts were paid for transiting ships.

The 193-kilometre Suez Canal accounts for about 12% of the total world trade movement.

Channel corruption

In parallel with the successive news about huge profits and increasing fees from the Suez Canal administration, the Egyptian shipping lane has been accused of corruption, according to the Maritime Anti-Corruption Network (MACN), in its report issued last week.

A report on the incidents of corruption in the maritime transport sector showed that the Suez Canal topped the list of the most corrupt and bribery shipping lanes for nearly a decade.

In its report, the network stated that it had received nearly 50,000 incidents of corruption in more than 1,000 ports in 149 countries during the period between 2011 and 2020, topping the Suez Canal corruption incidents with 1,795 incidents.

The port of Jakarta in Indonesia ranked second with 1,462 corruption incidents, and the port of Alexandria in northern Egypt came in third place with 993 incidents.

Incidents of corruption and bribery included the request of officials in the shipping lanes - captains and workers - packets of cigarettes or bottles of alcohol and money, according to the report, which confirmed the delay in transit of ships if these requests were not met.

For her part, CEO of MACN, Cecilia Muller-Torbrand, said that the cost of corruption is high and has serious consequences for industry and commerce.

She stressed that the data contained in the report is not intended to serve as evidence or to replace law enforcement, noting that many countries have launched procedures and opened investigations to discover loopholes and train port officials on integrity and improve management.

original right

Imposing additional fees on transiting ships is an inherent right of the Suez Canal, according to the opinion of the expert in maritime transport and logistics, Ahmed El-Shamy.

He explained - in press statements - that this right stems from the need to compensate the Canal Authority for the expenses incurred to serve international trade, and said, "We provide international trade with billions of dollars annually, which is in the interest of the major companies that own shipping lines that achieve multiples of the Suez Canal resources as net profits. ".

El-Shamy added that the prescribed additional fees are in line with the remarkable growth in global trade and the improvement of transportation economics in conjunction with the development of the Egyptian waterway and transit service.

Despite the huge sums of money that the Suez Canal spent over the past seven years, whether to develop the facility as a whole or to dig the new Suez Canal branch, Egypt continued to provide incentives for transiting ships without any increase in fees, according to the maritime transport expert.

In August 2015, Egyptian President Abdel Fattah El-Sisi inaugurated a 35-kilometre-long bypass project parallel to the Suez Canal, at a cost of about $8 billion.

war and navigation

For his part, the economic expert, Dr. Abdulnabi Abdulmutallab, explained how to calculate the transit fees in the shipping lanes, explaining that the cost of transit is not fixed as some believe, but rather is variable according to the size of the ship, its weight, its tonnage, the type of load, and the value of the load at the time of passage.

Accordingly, the Suez Canal provided incentives to encourage ships to pass through it when oil prices fell, and with the return of oil prices to their levels recently, the canal administration took a normal procedure, which is to raise traffic fees, according to Abdel Muttalib.

Also, the Russian-Ukrainian war that broke out a few days ago, according to the economist, had a significant impact on the canal management’s decisions to impose additional fees on crude oil tankers and petroleum derivatives transiting the shipping lane in both directions.

He explained - in his speech to Al Jazeera Net - that this war is the direct cause of the rise in oil prices, so the recent decisions of the Suez Canal Authority are closely related to the state of conflict between Russia and Ukraine.

As for the accusations against the Suez Canal administration regarding corruption incidents, Abdul Muttalib believed that it cannot be relied upon to measure corruption anywhere.

He added, "The process of estimating fees is subject to many complex and overlapping factors, and there is a great deal of negotiations and bargaining to agree on setting fees in a way that satisfies both parties, and there are those who believe that this type of bargaining is a request for bribes indirectly."

The economic expert stressed that the decisive factor in determining the extent of corruption is the number of lawsuits against the management of the shipping lane or the final court rulings issued against it.

But also, no one denies that corruption is present everywhere, according to his opinion. He continued, "Corruption may be more present in ports and water crossings. Otherwise, how can goods, drugs, people, and others be smuggled... the greater the movement of work and the diverse fields of work, the greater the possibilities of corruption." .