ICS and Suez Canal Authority Formalize Agreement for Greater Cooperation

The Suez Canal Authority (SCA), the Egyptian state-owned entity responsible for operating and maintaining the Suez Canal, and the International Chamber of Shipping (ICS), representing 80% of world’s merchant fleet, have agreed to work towards increasing information sharing and “negotiations on the movement of global trade through the Canal” under a Memorandum of Understanding (MOU) signed between the two parties today at the SCA head office in Ismailia, Egypt.

The year-long commitment formalizes discussions between the ICS and SCA that have taken place throughout the Covid-19 pandemic and since the grounding of the Ever Given in 2021 in March 2021.

A statement from the ICS said the agreement focuses on open communication on long-term strategies on issues including toll pricing, environmental protection, and decarbonization, with hopes it will lead to “in-depth collaboration on operational and structural policies of the Canal, the safety and security of transiting vessels, and enhancing pilotage, towing and repair services.”

The signing of the MOU comes after the Suez Canal Authority has increased rates and surcharges for ships transiting the waterway on three occassions so far this year, starting with a nearly across-the-board 6% toll increase for most vessel types beginning in February and followed by 10% surcharge on certain vessels starting March 1 and an even larger “temporary” surcharge increase starting May 1 (amount varies based on ship type and laden/ballast).

The MOU also comes as Egypt is set to the 2022 UN Climate Change Conference (COP27) later this year.

The Suez Canal Authority is also working on a project to expand a portion of the southern end of the canal for two-way traffic after grounding of the Ever Given.

The meeting between the two delegations marked the first in-person meeting between ICS and the SCA since July 2015, which at the time focused on the widening of the southern canal and an overview of the dual canal construction system, which has since been completed.

“ICS has enjoyed a close liaison with the Suez Canal Authority for almost a century. We thank the Authority for its hospitality and look forward to building on our cemented relationship,” said Esben Poulsson, Chairman of the ICS, who attended the meeting.

“The maritime industry is at an inflection point as we earnestly begin our transition to a renewable future. The conversations we have had this week leave me with great confidence that Egypt will be one of the leaders of industry’s green transition, leaning on its position at the heart of the maritime world,” Poulsson added.

“We adopt an ambitious vision to reinforce the pivotal role of the Suez Canal Authority amid the international community of maritime navigation, and the benefit of our clients is our major priority,” commented Admiral Osama Mounier Mohamed Rabie, Chairman and Managing Director of SCA.

A maritime delegation led by ICS is scheduled to return to Egypt for the UN climate summit to continue discussions on shipping’s transition to net-zero.

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