Suez Canal crisis in past and similarity with present geopolitics

Gauri Srivastava


The Suez Canal crisis has once again drawn lot of attention in recent weeks when a ship blocked the global trade running into billions of Dollars of losses within a span of two weeks. This even led to close down of few energy industries, ancillary units and power projects. This has prompted the great powers in the world and Asia to reconfigure their present strategy. The US, Europe, Gulf nations, China, Russia, Japan and India have now realized that the Suez Canal which forms the main backbone global economy is indeed a key pillar of global geopolitics.



The present Suez Canal crisis started as a mere technical problem in the beginning but within 48 hours it spread as a major crisis as major sea lanes of communications are blocked. Thus the global energy basins were cut off suddenly just due to a ship’s technical problem.

But some major powers have realized that this type of crisis can bring their industries into a halt if they do not plan for an alternate option from now. The vast European landmass and American mainland faced tremendous problems in assessing cheap crude oil and gas from Asia.

The Suez Canal, an artificial waterway in Egypt, joins the Mediterranean Sea with the Red sea and provides a shorter, alternate route between the North Atlantic and Northern Indian oceans.

Due to the crisis, Egypt also lost between $12 and $15 million in revenues for each day the waterway was closed, according to the canal authority.

The MV 'Ever Given was seized due to its failure to pay $900 million' compensation, Suez Canal Authority chief Osama Rabie was quoted as saying by Al-Ahram, a state-run newspaper.

Japanese-owned, Taiwanese-operated and Panama-flagged ship was moved to unobstructive anchorage in the canal's Great Bitter Lake after it was freed on March 29, and tailbacks totalling 420 vessels at the northern and southern entrances to the canal were cleared in early April.

The Suez Canal earned Egypt just over $5.7 billion in the 2019-20 fiscal year, according to official figures -- little changed from the $5.3 billion earned back in 2014.

The Canal has been strategically significant for the supply of oil to the European nations and for increasing global trade volume. In the past, the Suez Canal Crisis ensued in 1956 when Egypt chose to nationalize the British and French-controlled Suez Canal.

The then Egyptian President, Gamal Abdel Nasser, advanced with the step of nationalizing the Canal, after the United States and the United Kingdom, revoked their offer of financing the construction of the Aswan Dam on the river Nile.

The Aswan Dam was an important investment for Egypt to develop the river Nile, as well as to achieve a prosperous image in the international arena.

Nasser’s plan of nationalizing the canal and generating revenue by collecting tolls from the ships passing through it was not taken well by Britain and France. Their disapproval was based on the fact that they were the main shareholders of the Suez Canal Company, which operated the Canal. Other long-standing issues also played a role in pushing the three powers to devise a plan to invade Egypt and depose Nasser.

France was enraged by the support the middle-eastern superpower was extending to the rebel groups of Algeria, which was a French colony. For Britain, the blocking of the Canal itself was inimical for its commercial gains acquired through global trade, and for Israel it was a chance to do away with the Egyptian blockade of the Straits of Tiran, as well as to take its southern neighbor head-on for all the sporadic attacks it had subjected Israel to.

Following the nationalization of the canal, the British and the French attempted to reassert their colonial hegemony in the Middle-East. They planned a fake encounter in Egypt with the help of Israel.

Israel was to invade Egypt and move towards the Canal, responding to which the British and French forces would launch a war on Egypt on the pretext of controlling the conflict between the two Middle-Eastern countries. The attack failed as all three countries were forced to withdraw due to the heavy political pressure exerted by the United States and the Soviet Union as well as the backlash received from the United Nations.

The Suez Canal crisis challenged the previously undisputed European colonial dominance in the Middle East region. The relationship between the United States and its primary Cold War allies, Britain and France, deteriorated. The United States, which was not informed about the intentions of its closest associates regarding the situation in Egypt, raised legitimate moral outrage at this attempt by its allies to bridle their political possessions.

Another reason why the United States did not let the two European powers tyrannize their way in Egypt was that it was one of the major Arab players of the Middle East, and America considered it a potential partner to keep the Near East from slipping into Soviet hands.

It threatened to impose strict economic sanctions on the two European powers and Israel if they didn’t withdraw their forces from Egypt. The Soviet Union, too, threatened to attack the countries involved in the crisis, if they failed to withdraw from Egypt. All aggressors eventually complied.

Egypt emerged as the overall winner, even after it lost militarily, retaining control of the canal while being supported by the United Nations and America. This brought to the fore the changing power structure in the grandstand of world politics. The decline of imperial states was visible; Britain’s position shifted from that of the top world power to a second-tier one.

Anti-colonial sentiments rocketed following the crisis and the speed of decolonization accelerated. Soviet Union’s intimidation to the attacking countries earned it a soft corner in the hearts of the Arab world. Soviet influence grew in the Arab and Third World countries while that of Western powers declined. It became clear that the European powers couldn’t exercise an independent foreign policy on the world stage without America’s support.

This dawned the end of colonial control over the Middle-East and the emergence of new leaders, like Nasser, who were willing to forge new relations with the superpowers of the world.