A shortened trade route from Iraq to Egypt.. Will it harm the Suez Canal?

[size=33]A shortened trade route from Iraq to Egypt.. Will it harm the Suez Canal?[/size]
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The Suez Canal transports 12% of global trade (Al Jazeera)
[You must be registered and logged in to see this link.]Abdullah Hamed
12/31/2023|Last updated: 12/31/202302:53 PM (Mecca time)
Cairo - Egypt has begun implementing advanced stages of a tripartite multimodal transport project, which was agreed upon months ago with the leadership of both Jordan and Iraq, to ​​facilitate trade exchange and facilitate the flow of [You must be registered and logged in to see this link.] and goods from the east, where the port of Basra, to the west, and from there to the Mediterranean Sea and Europe, according to Statement from the Ministry of Transport.
The new commercial line in Jordan intersects with another coming from the Emirates, passing through Jordan, the third partner with Egypt and Iraq in the original line, and arriving to Israel with the participation of an Egyptian company that recently joined the project, renewing Tel Aviv’s hope of reviving the Ben Gurion Canal across the Gulf of Aqaba.
The two lines passing through Jordan avoid attacks by the Yemeni [You must be registered and logged in to see this link.] on cargo ships owned by Israeli companies, or heading with goods towards Israel.
On the map, the new trade line appears much shorter than passing through the Arabian Gulf, then the Indian Ocean and then the Red Sea. This route shortens the long distance that ships had to travel, before the Houthi threats exacerbated the crisis of ships passing through the [You must be registered and logged in to see this link.] Strait , and accelerated - in the opinion of observers - the implementation of the new trade route. The project.
Jordan announced that the ongoing disturbances in the Red Sea are pushing towards the operation of the land and sea transport line with Egypt, after 103 container ships took a long route around Africa to avoid attacks, which leads to additional costs and delays, while A.P. Moller-Maersk, the second largest operator, expected For a container shipping line around the world, “the chaos affecting shipping through the Red Sea will continue for several months.”
The new line project raises a number of questions about its impact on [You must be registered and logged in to see this link.] revenues , which are already decreasing by a rate estimated by specialists at about 40% after the Houthi attacks. It also raises the question about the extent to which it is negatively or positively affected by other trade lines that have been announced, including the [You must be registered and logged in to see this link.] , coming from India, passing through the Arabian Gulf, then Israel, and from there to Europe.

The Egyptian Ministry of Transport stated - in a statement - that it is implementing an integrated plan to develop and develop international multimodal transport hubs “land, rail, river and sea” and within the framework of the Taba Al-Arish logistical corridor, which is currently being implemented within a number of 7 integrated international development logistical corridors.



The Ministry confirmed that it is currently implementing the second phase of the Arab Trade Line by establishing the “Taba Al-Arish-Bir al-Abd Al-Fardan” railway line, with a length of 500 kilometers, to increase the volume of goods intended to be transported from the Gulf, Iraq and Jordan to Europe and America.
This road - according to the Egyptian Ministry of Transport - consists of a railway corridor linking the ports of Nuweiba and Taba, which is planned to be implemented on the Gulf of Aqaba with the ports of Al-Arish and east of Port Said on the Mediterranean Sea, then linking to all ports on the Mediterranean Sea, “Damietta, Abu Qir, Alexandria Al-Kabir, Jargoub” and from there to European and American ports.

Reviving old agreements

Academic maritime transport expert Ahmed Sultan enumerated the advantages of the new Arab trade route in increasing the rates of intra-Arab trade, and helping in transporting Jordan and Iraq’s exports from the Gulf and the Arab East towards Europe, given the importance of Egypt’s position in international trade, and the role of this in maximizing the benefit of the country’s ports.
The new project revives an old land road - which was part of the Belt and Road Initiative - whose importance was reduced by its high cost, compared to the road from the Bab al-Mandab Strait and the [You must be registered and logged in to see this link.] to the Suez Canal.
Sultan confirms - in an interview with Al Jazeera Net - that the project, during its first year, will increase trade exchange between the three countries, and will also raise Egypt's exports by 11%, and Jordan's exports by a similar rate, while Iraq's exports may exceed about 6%.
The project renews the Agadir Agreement on trade between Egypt and the countries of the Maghreb, and facilitates the arrival of Iraqi and Jordanian exports to the Maghreb. According to Sultan, the project solves the problems of the Houthis targeting navigation in the Red Sea, and also eliminates attempts to circumvent the Suez Canal, as is said about the Ben Gurion Canal, which It remains an impractical project, and for local consumption within Israel only

Sultan denied any competitive impact of international roads on this line and on the Suez Canal, as the Silk Road starts from China in the north, passing through Russia and reaching Europe, as well as the trade corridor coming from India, passing through the Gulf states and ending in Europe via Israel, explaining that these projects are very expensive and impractical in comparison. The Suez Canal, which remains the best and cheapest corridor for global trade.

Positive effects

Professor of Maritime Transport at the Arab Academy of Transport, Muhammad Ali, in an interview with Al Jazeera Net, believes that the shortcut trade route project turns the road between [You must be registered and logged in to see this link.] , Nuweiba and the Egyptian ports into a vital commercial artery, and opens the door towards Arab economic integration.
According to the spokesman, the road will revitalize the Arab Bridge Company, which owns a fleet of ferries and fast boats that has worked for many years in transporting goods and services between the countries of the Levant and the Maghreb, as well as revitalizing the links between Arab sea ports overlooking the Red Sea.
The project revives in accordance with the “Agadir” agreement signed between Egypt and the Maghreb countries since 2001, which unified and reduced customs between Egypt, Tunisia and Morocco, so that this line raises the level of intra-Arab trade, eventually reaching the Arab common market and the Arab free trade zone.
Ali denies that the project will compete with the Suez Canal, which transports 12% of global trade, and it is beyond the capacity of the new multimodal complex road, which makes the canal shorter and the cheapest tool for transporting global trade, despite warnings of the danger of this Arab trade route to the Suez Canal, especially with the announcement of More than 103 giant cargo ships were diverted after the Houthi attacks.
For his part, economic expert Hani Abu Al-Futouh pointed out that expected changes in oil prices raise the cost of sea and land transport, and lead to increased reliance on maritime transport and raise the shares of the Suez Canal.


He added: But as the volume of trade between the Middle East and the world increases, reliance on land lines decreases.
He stressed - in an interview with Al Jazeera Net - that maritime transport remains the fastest and least expensive, especially since the expansion of the Suez Canal has increased its capacity to receive more ships, which reduces the demand for land routes.
The new road in this way, as Abu Al-Futouh says, is nothing more than a temporary solution to the reluctance of some companies to use Bab al-Mandab and the Red Sea due to recent threats, although it will contribute to increasing trade exchange between the three countries and stimulating trade between the Arab Levant and Morocco.
Source : Al Jazeera
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