MELISSA BLOCK, HOST:
Egypt declared a national holiday today in honor of the opening of the new Suez Canal. A flotilla of ships sailed down the waterway, including a yacht which was the first vessel to pass through the Suez Canal when it opened in 1869. But the project might not raise as much money as the Egyptian government promises. NPR's Jackie Northam reports.
JACKIE NORTHAM, BYLINE: Egypt pulled out all the stops for the unveiling of the new a $8 billion expansion.
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NORTHAM: State television showed a military band playing as American-made F-16 fighter jets flew overhead and enormous ships floated down the newly opened waters of the canal linking the Mediterranean Sea to the Red Sea. Egyptian president Abdel Fattah el-Sisi addressed the nation from the ceremony.
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ABDEL FATTAH EL-SISI: (Speaking Arabic).
NORTHAM: Sisi called the expansion a historical achievement that would bring prosperity and was created in record time. The expansion was supposed to take three years to build. Instead, it took less than one year. Massive dredgers worked around the clock to dig the waterway. Janet Porter, an editor with Lloyds List, a shipping industry news provider, says the speed in which it was built caught many in the shipping industry off guard.
JANET PORTER: I think most of us hadn't really realized quite what they were doing. This is sort of a big trench in the desert. But it's still a technological sort of marvel to have got it and to have done it so quickly.
NORTHAM: The new extension is about about 45 miles long, roughly one third the length of the whole Suez Canal. Think of it as a passing lane. Before, ships had to move in a convoy in one direction and then wait while another convoy came from the other way. Now ships can move in both directions. Nils Haupt is the communications director for Hapag Lloyd, the fourth largest container shipping company in the world. He says the expansion will help keep costs down.
NILS HAUPT: Because we will save some time - eight hours per trip. And if you save time, you save money. So six times a week, we are passing the canal so far, so it really adds up.
NORTHAM: The Suez Canal authorities says the number of ships are expected to double, bringing in an additional $13 billion a year by 2023. Haupt and others in the shipping industry doubt those figures. Global trade is sluggish, and there are too many ships and not enough cargo. And there's competition from the Panama Canal, which is due to complete its own expansion next year. Haupt says it will be able to accommodate much bigger ships than it does now.
HAUPT: The Panama Canal is kind of a game changer because the South American market is more and more important for shipping lines. And even now, the ship size can be doubled or even tripled. This is very important.
NORTHAM: But the Suez Canal is capable of handling the world's largest ships that ply the lucrative route from Asia to Europe. It could also see additional traffic from the oil industry in the near future, says Simon Bennett with the International Chamber of Shipping.
SIMON BENNETT: If we see the removal of sanctions from Iran, that's likely to see an increase in ships using the canal. Also, if U.S. crude exports were permitted, that would also have an impact on increasing Suez Canal traffic.
NORTHAM: But an Egyptian windfall is far from guaranteed despite today's festivities on the Suez Canal. Jackie Northan, NPR News. Transcript provided by NPR, Copyright NPR.
