Suez Canal revenues plunge by 60 percent as Egypt faces economic and political turmoil

Egypt’s Suez Canal has seen its revenues nosedive by more than 60 percent in 2024 compared to the previous year, amounting to a staggering $7 billion loss, according to a statement released on Thursday.

The canal, which facilitates 12 percent of global trade and is a lifeline for Egypt’s battered economy, has been heavily impacted by Israel’s war on Gaza and the Houthis in Yemen.

Yemen’s Houthi movement has threatened ships carrying goods to Israel, effectively disabling trade passing into the Red Sea through the Bab el-Mandeb Strait.

Since November 2023, the Houthis have launched nearly 100 attacks on ships in the Red Sea, actions they say are in solidarity with Palestinians suffering under Israel’s war on Gaza, which has killed more than 45,400 people and wounded at least 107,940 Palestinians.

The Houthis have said they will stop their attacks if Israel’s war on Gaza stops.

Israel faces charges of genocide at the International Court of Justice (ICJ), and human rights organisations have published a vast body of evidence detailing ethnic cleansing and war crimes committed by the Israeli army.

The International Criminal Court (ICC) is also pursuing arrest warrants for Israeli Prime Minister Benjamin Netanyahu and former Defence Minister Yoav Gallant on charges of war crimes and crimes against humanity in connection with Israel’s war on Gaza. 

Houthi attacks have prompted many shipping companies to reroute their vessels around the Cape of Good Hope in South Africa, bypassing the Suez Canal altogether.

Egypt's growing political instability

Despite attacks by the United States, Britain and Israel on Yemeni territory, the Houthi military operations have continued unabated.

The disruptions in the Red Sea have dealt a devastating blow to Egypt, which is already reeling under a worsening economic crisis.

Inflation is soaring, the currency is in freefall, and millions of Egyptians are grappling with a spiralling cost-of-living crisis.

The dire state of Egypt’s economy is mirrored by its political instability, particularly in the wake of Syrian President Bashar al-Assad’s fall.

While Abdel Fattah el-Sisi, Egypt’s authoritarian leader, has avoided directly commenting on Assad’s ousting, his recent statements reflect growing anxiety about his own grip on power.

“My hands are not stained with anyone’s blood, nor have I stolen anyone’s money,” Sisi declared defensively to military leaders and journalists earlier this month.

The remarks, made in the shadow of Assad’s collapse, appear to betray his unease.

Sisi, who seized power through a military coup a decade ago, now holds the dubious distinction of being the region’s most oppressive ruler.

Under his regime, over 65,000 political prisoners languish in Egyptian jails. Forced disappearances are routine, and torture has become so systematic that human rights organisations describe it as a state policy amounting to crimes against humanity.

With revenues from the Suez Canal collapsing, Egypt’s tourism and remittance sectors will face increased pressure to prop up an economy teetering on the brink.