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EnterpriseAM reported in its edition titled “The hangover?” that the Ever Given may have been dislodged in under a week but the effects would be felt for months. The disruption caused to US and European supply chains by the blocking of the Suez Canal last month may not be resolved until 3Q2021. CEO of German shipping company Hapag-Lloyd Rolf Habben Jansen told the Financial Times that several shipping companies anticipated severe knock-on effects on international shipping and logistics.
The six-day blockage of the canal by the Ever Given left more than 400 container ships idled off the coast of Egypt according to the EnterpriseAM account. It took six days for all of the ships to pass when the canal was finally unblocked on 29 March. The publication detailed how ports in Asia and Europe would confront a sudden influx of vessels in the coming days and weeks as a result.
Hapag-Lloyd was not alone in its assessment of the situation. EnterpriseAM noted that the world’s largest shipping line Maersk was slightly less pessimistic but still anticipated several more weeks of disruption. Lars Mikael Jensen head of global ocean network at Maersk forecast that ripple effects would continue into the second half of May. He anticipated normalization in Europe toward the back end of the second quarter with the US returning to normal after that.
The Suez Canal Economic Zone signed a long-term syndicated loan worth EGP 10 billion to finance infrastructure projects EnterpriseAM reported in the same edition. The 10-year loan was signed with a consortium led by the National Bank of Egypt and will fund projects at industrial zones and ports in the zone. It is divided into two tranches one EGP 5 billion local currency portion and a USD-denominated tranche worth USD 320 million.
A Central Bank of Egypt assessment placed the overall economic impact of the blockage in the billions of dollars due to delayed goods and higher shipping costs. The authority’s data showed daily trade volumes through the canal averaging more than $9 billion prior to the incident. EnterpriseAM observed that the loan would support longer-term resilience in the zone’s ports and industrial areas.
The National Bank of Egypt led the financing consortium for the Suez Canal Economic Zone facility according to the EnterpriseAM summary. The deal forms part of ongoing investments to expand capacity at key logistics hubs. Officials expect the funding to accelerate development timelines at multiple sites along the canal corridor.
