The Suez Canal crisis, and its impact on global trade

#GS1 Geography

#GS3 International Trade


News info:

A container ship called the ‘Ever Given’ was freed a week after it ran aground and blocked other vessels from transiting one of the world’s most important waterways. 

A human-made waterway, the Suez Canal is one of the world’s most heavily used shipping lanes, carrying over 12 percent of world trade by volume.

Explanation:

The Suez canal took 10 years to build in the Mid-1800s, 

1 Megaship blocked it in the day in March 2021 which made global trade go into a tailspin.

Geography:

Suez Canal ship stuck: How did Ever Given get stuck?
  • The 193 Km artificial canal is:
  • Shortest sea link between Asia and Europe since 1869
  • Longest canal with no locks
  • One of the busiest trade routes
  • A flashpoint for geopolitical conflict

Cargo Blockade:

MV Ever Given, headed from China to the Netherlands, had run aground and gotten stuck across the canal for a week.

Reason:

  • Strong wind or human/technical error is being investigated.

The large cargo ship had blocked the path of 400+ ships.

History: Suez Canal

  • Pharaoh Senausret III dug the first canal in 1887-1849
  • Finally built between 1859-69, with 1.5 million workers, in Ottoman-ruled Egypt
  • After 2 World wars, Britain relinquished canal authority to Egypt in 1956
  • Closed 5 times in the past- after Abdel Nasser's government nationalized it in 1956; for 8 years after the 1967 Arab-Israeli war.

Impact on Global Trade:

The canal carries-

  1. 12% of World trade
  2. 7% World's oil
  3. 30% of Container-ship traffic daily
Suez Canal blockage: 4 of the biggest trade chokepoints | Business| Economy  and finance news from a German perspective | DW | 27.03.2021

Source: The Hindu

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