70 years after nationalization: the suez canal—future prospects

The Kemet Boutros-Ghali Foundation for Peace and Knowledge held a seminar entitled “70 Years After Nationalization: The Suez Canal—Future Prospects” with the participation of an array of public figures, experts and specialists. The seminar examined the Suez Canal’s economic and strategic importance, the challenges it faces, and visions for developing its role in the coming years.

The seminar was attended by senior diplomat Amre Moussa, former Minister of Foreign Affairs and former Secretary-General of the League of Arab States; Dr. Ziad Bahaa El-Din, former Deputy Prime Minister; and Ambassador Leila Bahaa El-Din, Executive Director of the Kemet Boutros-Ghali Foundation for Peace and Knowledge.

Discussions highlighted the importance of strengthening attention to Red Sea security and protecting shipping lanes, given the direct link between regional stability and the regular movement of ships through the Suez Canal. Participants stressed the need to enhance the security and military capabilities required to protect freedom of navigation.

Participants also underscored the importance of continuing the Suez Canal’s engineering development to ensure that it can accommodate giant ships and container vessels, improve the efficiency of the navigation channel, and maintain its competitiveness against alternative transport routes.

Professor Ali El-Din Hilal, the Egyptian thinker, said that the history of the Suez Canal reflects part of Egypt’s geostrategic importance and is also linked to periods of colonial influence and foreign intervention in the country. He noted that the Canal’s principal advantage is that it is the shortest maritime route between Asia and Europe.

Hilal added that discussion of alternatives to the Suez Canal should avoid exaggeration and distinguish between routes that actually exist and their ability to compete with the Canal. The Cape of Good Hope route, he explained, is not a genuine alternative under normal conditions because of the greater distance and higher cost. The Arctic route between China and Europe is still used seasonally and does not operate year-round with the same efficiency. Meanwhile, the land corridor linking India, Iran and Russia faces challenges related to infrastructure and political conditions.

He added that the Canal Authority’s move to provide services related to green fuels and logistics could strengthen the Canal’s competitiveness, particularly as global interest in reducing carbon emissions continues to grow.

For his part, Eng. Ali El-Hefnawy, Professor of Architecture at the University of Paris and son of Dr. Mostafa El-Hefnawy, who drafted the Suez Canal nationalization proposal, said that his father’s legal and historical research had led him to conclude that the Suez Canal Company was an Egyptian joint-stock company and therefore subject to nationalization.

He revealed that Gamal Abdel Nasser had asked his father, during a secret meeting in 1954, to stop his media campaign against the Suez Canal Company, including closing his newspaper, discontinuing his lectures, and ceasing to speak on the radio. In return, Nasser assured him that the company would be nationalized after British forces had withdrawn.

El-Hefnawy added that another meeting took place between them on 24 July 1956. During that meeting, President Abdel Nasser asked Mostafa El-Hefnawy to help him implement the nationalization decision. They spent the night reviewing documents and materials related to the Canal, after which Abdel Nasser asked him to prepare a draft of the nationalization decree.

Dr. Ahmed Galal, former Minister of Finance, said that the Suez Canal’s importance is not limited to transit fees. The Canal is also a significant source of foreign currency for the Egyptian economy: it generated approximately US$61 billion between 2014 and 2024, while revenues peaked at around US$10 billion in 2023. He expected revenues to reach approximately US$6 billion in the current year, amid the impact of disruptions to global shipping and rising insurance costs.

The former Minister of Finance stressed that expanding economic activity in the Suez Canal Zone could, in the future, become more important than the revenues generated by ships transiting the Canal itself.