Sunday , 17 December 2017
Latest News

Suez Canal discussing early toll payments with carriers

The Suez Canal Authority (SCA) is in talks with several global shipping lines over introducing a new toll structure where charges are levied three or five years in advance in return for a discount.

Mohab Mamish, chairman of the SCA, told The Wall Street Journal: ““We are talking with the big carriers about a scheme to deposit a certain balance and every time their ships transit, a deduction will be made.”

““We will offer in return a discount of around 3% in transit rates,” he added, while confirming that Maersk Line, MSC and CMA CGM are among the carriers involved in talks.

According to Mamish, an agreement could be reached next week before going into effect at the start of 2016.

The canal’s tolls for 2017 will be announced in January with a cut “under consideration”.

The waterway has come under pressure this year due to the industry’s dire performance as well as the opening of the expanded Panama Canal.

With considerable support from the Egyptian government, the SCA spent US4bn last year to deepen the canal although revenue this year is only slightly up.

It made US$3.2bn in the first half of 2016, up by just 4% over the equivalent period last year.

The canal authority earns over US$1.5bn a year in tolls from Maersk Line, MSC and CMA CGM, the world’s three largest container shipping lines.