Uploaded on May 4, 2022
PPT on the Importance of the Suez Canal to Global Trade.
The Importance of the Suez Canal to Global Trade
The Importance of the Suez Canal to Global Trade Introduction The Suez canal is a significant route for energy, commodities, consumer goods and componentry from Asia and the Middle East to Europe. The canal’s location also makes it a key regional hub for shipping oil and other hydrocarbons. 2 S O U R C E : W W W . M F A T . G O V T . N Z Suez Canal Officially opened in November 1869, the Suez Canal in Egypt, connects the Mediterranean Sea to the Red Sea. One of the world’s most heavily used shipping lanes, the Suez Canal provides the shortest maritime route between Europe and the lands lying around the Indian and western Pacific oceans. 3 S O U R C E : W W W . V E L T A . C O . U K Transportation The recent grounding of the Ever Given container vessel has underscored the importance of the Suez canal for global freight and supply lines. Approximately 12% of global trade and 30% of global container traffic traverse the Suez, transporting over USD $1 trillion worth of goods per annum. 4 S O U R C E : W W W . V E L T A . C O . U K Panama Canal On average, 50 ships traverse the canal daily carrying between USD $3-9 billion worth of cargo. Over one billion tonnes of cargo was shipped through the canal in 2019, four times the tonnage transiting the Panama canal during the same period. 5 S O U R C E : W W W . V E L T A . C O . U K Busiest Trade The Suez is one of the most important and busiest trade arteries in the world, indicating that the Middle East and Africa region, and Egypt in particular, are a strategic nexus for New Zealand global trade. 6 S O U R C E : W W W . V E L T A . C O . U K Supply Chain As supply chains and global trade have increased in quantity and complexity, maritime vessels have grown to meet demand. 7 S O U R C E : W W W . M F A T . G O V T . N Z Income for Egypt The Suez waterway is operated by the Egyptian state- owned SCA and provides a significant income for Egypt. 8 S O U R C E : W W W . M F A T . G O V T . N Z The cost Analysts suggest Europe has experienced the strongest impact of the stranding. However, companies in Asia will not only be impacted by the delay of shipments from Europe, but also by a shortage of empty containers returning to the region. 9 S O U R C E : W W W . M F A T . G O V T . N Z Issues At present there are no suitable alternatives to the Suez canal, except the long trip around the southern tip of Africa. Transiting the Cape of Good Hope route requires an additional 9,000km or 6-14 days travel time, depending on the vessel and cargo. The usual transit time of the Suez end-to-end is about 13-15 hours. 10 S O U R C E : W W W . M F A T . G O V T . N Z Conclusion The Suez canal is a critical maritime passage for global supply chains and among the world’s most significant trade chokepoints, alongside the Strait of Hormuz, the Malacca Strait and the Panama canal. 11 S O U R C E : W W W . M F A T . G O V T . N Z
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