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Egypt launches Suez Canal expansion

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All is set  for the opening of a major expansion of the Suez Canal in Egypt Thursday. The canal is to deepen the main waterways and providing ships with a 35km channel parallel to it. It is said that the expansion is aimed at increasing the traffic handled by the canal.
Foreign leaders are due to attend an inauguration ceremony on Thursday, promoted by Egypt’s government as an occasion for national pride.
Egypt’s government hopes the revenues will boost the economy – but analysts have questioned the projections.
They point out that the volume of world trade has not been growing at the pace needed to deliver the sums Egypt hopes to collect.
Takings from Suez could also be hit by an expansion of the Panama Canal, due to be completed next year, which will compete for traffic along the Asia-North America route.
Ahmed Kamaly, an economist with the American University in Cairo, told Reuters news agency that the Egyptian projections were “wishful thinking”.
“There was no viability study done, or known of,” he was quoted as saying. He added that the immediate benefits from the expansion were more likely to be political than economic, uniting people “around a national project”.
Many Egyptians have also questioned whether the money could have been better spent on welfare or other infrastructure work.
The project is estimated to have cost $8.2bn (£5.3bn).
The expansion will allow for two-way traffic along part of the route, as well as for larger vessels overall. The construction of the new lane began a year ago, on the orders of Egypt’s President Abdel Fattah al-Sisi.
Security has been tightened for the inauguration ceremony amid fears of attack by militants allied to Islamic State.
The militants, based in the Sinai peninsula, have killed hundreds of people since the military overthrew the Islamist government of president Mohammed Morsi in 2013.
The original canal, opened in 1869, currently handles 7% of global sea-borne trade.
The waterway connects the Mediterranean to the Red Sea, providing the shortest sea link between Asia and Europe.
Its nationalisation led to a brief war in 1956, pitting Egypt against the UK, France and Israel.




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