CAIRO: Egypt’s Suez Canal revenue fell 0.5 percent to $390 million in December, for the smallest year-on-year fall since November 2008 when faltering global trade began to hit shipping traffic, Reuters reported.
The figure is up from $365.5 million in November 2009, and down only 0.5 percent from $392 million registered in December 2008,
Some 1,452 vessels passed through the canal in December, up from 1,418 in November but down from 1,560 in December 2008, the Egyptian cabinet’s information website said on Sunday.
“It shows that trade volumes and revenues have stabilized since the first half of the year, but it will be some time before revenues and volumes approach levels seen in early 2008, EFG-Hermes economist Simon Kitchen told Reuters.
He had forecast December revenue of $380 million.
The canal is a vital source of foreign currency in Egypt, along with tourism, oil and gas exports and remittances from Egyptians living abroad.
Total revenues for the first half of fiscal year 2009/10 reached $2.3 billion, compared to $2.7 billion in during the same period last year.
Although canal revenues peaked in fiscal year 2007/08 at $5.2 billion, the first half of fiscal year 2008/09 was stronger in terms of revenues and traffic, due to the high global growth preceding the eruption of the global crisis.
In a note to investors, Beltone Financial said, “The canal revenues are in line with our expectation of $390 million in December 2009, reflecting the continued recovery in global trade and the effect of rising oil prices in rendering alternative longer maritime routes more expensive.
We expect that as the US and EU continue to recover from the global economic crisis, their trade with Asia, and especially China and India, will reflect positively on the number of vessels, especially non-oil, and their tonnage, passing through the canal.
It has not been confirmed yet whether the Canal Authority will raise transit rates or not in 2010, which could lead to a rise in revenues after April, when the new fees become effective.
“We believe the Canal Authority might opt to continue granting incentives to vessels to pass through the canal, keeping transit fees unchanged pending a healthier recovery in the global economy, Beltone added.
The investment firm expected canal revenues to total $5 billion in fiscal year 2009/10 and $5.3 billion in fiscal year 2010/11. -Daily News Egypt with additional reporting by Reuters.