Egypt May Seek $1 Billion in Damages for Suez Canal Crisis

CAIRO (Capital Markets in Africa) — Egypt said it may seek around $1 billion in compensation after a giant container vessel blocked the Suez Canal for almost a week and roiled shipping markets.

The figure is a rough estimate of losses linked to transit fees, damage to the waterway during the dredging and salvage efforts, and the cost of equipment and labor, the Suez Canal Authority’s chief executive officer, Osama Rabie, said late Wednesday to local television channel Sada Elbalad.

He did not specify who the Canal Authority would seek compensation from.

“This is the right of the country,” Rabie said, adding that the incident hurt Egypt’s reputation. “This country should get its due.”

The 400-meter-long Ever Given ship, owned by Japan’s Shoei Kisen Kaisha Ltd., ran aground on March 23 in the southern part of the canal and was freed six days later.

Taiwan’s Evergreen Marine Corp., the vessel’s charterer, said Thursday it’s not responsible for delays of any cargo it was transporting.

“There is almost no chance that we will be sought to pay compensation,” Evergreen Marine President Eric Hsieh said at a briefing in Taipei.

Shoei Kisen will discuss compensation with the Canal Authority, but will refrain from giving details for now, according to a spokesperson.

Bitter Lake
The ship and its cargo are currently in the Great Bitter Lake, roughly halfway along the canal.

While they could be held in Egypt if the matter of compensation goes to court, such a scenario is unlikely, Rabie said.

It may take until Friday night or Saturday to clear the backlog of hundreds of ships that built up while the canal was shut, Rabie said in a separate interview with Egyptian television.

Evergreen’s agent in Egypt, Mohamed Bahaa, said he doubted there would be any financial dispute between his company and the Canal Authority.

“In 40 years, not a single case of dispute has happened between SCA and Evergreen,” he said in an interview. “We all respect all the rules of the SCA.”(Updates with comments from shipping companies.)Related ticker: