What Is the Suez Canal and Why Is it Important?

(Last Updated On: March 26, 2021)
What Is the Suez Canal and Why Is it Important?

With its unique geographic location, the Suez Canal (Arabic: Qanāt al-Suways) is an Egyptian waterway that was constructed at sea-level and is currently the shortest operating route linking the east and the west, Europe and Asia. It spans 120 miles across the Isthmus of Suez in Egypt and connects the Red Sea with the Mediterranean. The Suez is currently the longest canal without any locks.

The Suez Canal is internationally recognized and appreciated for many reasons. But why? Let’s explore this important passage a bit more in depth.  

Related post: Interesting Mediterranean Sea Facts

History of the Suez Canal

Since ancient times, a passageway between the Red and Mediterranean Sea was sought after, but thought impossible due to differences in elevation. That thinking would change in the 19th century, however, when scientists determined such a canal could actually work. Soon after, the quest to construct a link between the two bodies of water began.

Ferdinand de Lesseps, a French diplomat, was responsible for developing the Suez Canal project. While ultimately successful at the Suez Canal, he struggled later when trying to plan the Panama Canal. The latter project was eventually carried out by the United States instead.

The Suez Canal took ten years to construct, and was officially opened on November 17, 1869. An estimated 1.5 million people worked on the project, challenged by financial constraints, cholera, and the physical limitations of building by hand.

The canal was originally owned by Egyptian and French entities, until 1875 when a financial crisis forced Egyptian owners to sell their shares to the British. 

The Suez Crisis

After Egyptian President Gamal Abdel Nasser announced his plans to nationalize the Suez Canal Company in 1956, France and Britain were furious. The company was long owned by the French and British, and considering the announcement came after months of accumulating political tensions between the countries, the British government hinted they may start to use force. Britain and France were having secret military consultations with Israel, who saw the Egyptian President as a threat to their security. In October 1956, Israeli troops started attacking the Egyptian Sinai Peninsula, making British and French troops fly in to protect the canal.

About one month later, the United States pressured France and Britain to accept a ceasefire. They were concerned about the conflicts of their European allies and feared the possibility of intervention from the Soviet Union. The US publicly disapproved of the invasion and approved the creation of a United Nations peacekeeping force. In 1962, Egypt had finalized its payments to the previous owners and took over the canal under the Suez Canal Authority (SCA) company.

Recent Expansion

Undergoing just one year of construction, a “New Suez Canal” was opened in 2015. While the project expanded and deepened areas along the original canal to allow for larger ships, a new 22 mile (or 35 km) canal was also added parallel to the original. The new canal was developed to enable two-way traffic that will significantly shorten wait times, improve the speed of traffic, and increase the waterway’s capacity as trade continues to grow.

Of course, despite these improvements, navigating the Suez Canal remains a risky operation. In March 2021, a 1,300 foot container ship was blown off course during a sandstorm, completely obstructing passage to vessels in both directions. The economic impact of this blockage was felt worldwide.

The Importance of the Suez Canal

Further reading: Is Egypt Part of Africa or Asia?

The Importance of the Suez Canal

For International Trade

The Suez Canal is one of the world’s most heavily used shipping lanes, with thousands of vessels passing through each year. It’s extremely important for international trade as it operates as a direct route across the Mediterranean, which makes transportation faster and cheaper. Considering that waterways are responsible for 80% of world trade volume, the Suez Canal has played a vital role in the evolution of world trade and transport. The recent expansion will help make global trade even easier and more convenient. The SCA is aiming to increase the daily average of transit ships to 97 by 2023, with the goal to maintain its high ranking among the greatest canals.

For the Egyptian Economy

There’s no denying that operating a high-functioning waterway significantly impacts a country’s economy. And with recent expansions, Egypt will benefit on an even greater economic scale as the world continues to benefit from the popular canal. The SCA aimed to increase annual revenues from $5.3 billion to $13.226 in 2023, aiming for a growth of 259% that will have a positive impact on Egypt’s national income. They also aim to increase employment opportunities for people living near the canal and improve the country’s working economy.

Advantages of the Canal

  • The world’s longest operating canal without locks.
  • Enables high-functioning international trade.
  • New expansion reduces traffic and waiting times, making transit faster.
  • Boosts national economic growth in Egypt and creates new job opportunities.  
  • Can be innovated to allow for larger ships and greater capacities.

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