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After 150 Years: Suez Canal Still matters

Zaeem Hassan Mehmood

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“No one is more a canalist than I, but I want the Canal to belong to Egypt, not Egypt to the Canal”-Isma’il Pasha, Khedive of Egypt

The Suez Canal, since its establishment in 1869, has remained to be an important artery for world trade crisscrossing from the East and West. It has great impact on the global economy considering that it provides waterway for transporting petroleum commodities from the producers to the consumer states. Added to that, from a defence and strategy perspective, the canal has been used as “a gateway for military convoys” from the Mediterranean to the Red Sea. According to some pundits, it is the strategic opening to the Middle East provided by the canal that has allowed for great powers to instigate rivalry and conflict in the region. 

Suez Canal and Egypt

With Egypt’s growing readiness to implement policy, the country has witnessed the implementation of some great national projects, the most important of which is the new Suez Canal project: the development of the existing Suez Canal and the area alongside the canal. There was also a national security objective for Egypt, whereby it aimed to transform itself into a world centre of logistics and industry to act as a catalyst for economic development for the country. The location’s advantages have allowed it, to attain to a certain degree of world centrality in terms of industrial economic zones, distribution of transit trade, and logistics services for ships transiting the Suez Canal (Mostafa Kamel Al-Hegazy, 2013). The challenges Egypt faced in the political realm arising from domestic, regional and global downturns have hindered it from obtaining the desired benefits. Suez Canal, considered as one of the most important navigation lanes in the world, plays its part in facilitating one tenth of the globe’s trade. However, annual revenues, did not exceed above $5 billion in the previous years. In spite of expansion and deepening attempts, most giant ships cannot go through the canal and are forced to turn around the Cape of Good Hope. The present Suez Canal is not optimally exploited despite its economic importance as there are no adjunct port services, logistics and industrial centres, ship maintenance and repair workshops, storage facilities and transit trade, unlike in other states of the region, such as the Port of Jabel Ali project in Dubai, the United Arab Emirates. Therefore, it cannot not cope with such challenges except through its contribution to providing attractive privileges for global trade transit.

Egypt’s New Suez Canal

The revenues of the Egypt’s Suez Canal reached 5.9 billion U.S dollars in the fiscal year of 2018-2019, an all-time record in the waterway’s history, Chairman of the Suez Canal Authority Mohab Mamish said, “The canal made an increase of 300 million dollars or 5.4 percent increase compared to the previous fiscal year.”The new channel in the Mediterranean and Red Sea is 9.5 kilometers long and 18 meters deep has been aimed to reduce navigation time for ships to 11 hours from about 18-22 hours, and cut vessels’ waiting time to three hours from a previous delay of eight to 11 hours. The new channel was opened in 2015 amid doubts about the feasibility of the project in light of the uneasy global economy and instability in the Middle East. It is reported that 70,679 ships with record 4.268 billion tons have crossed the canal since its inauguration.

New development projects and up gradation of the canal have helped improve the performance and earn greater revenues in the short period of time. The importance of the new channel is likely to pave way for building other mega-level projects including the tunnels that connect the three canal cities, notably Suez, Ismailia and Port Said, as well as the Sinai Peninsula. The tunnels, two of which were built under the canal, will facilitate the development of the Suez Canal Corridor Area Project, which was launched in August 2014 and aims to increase the role of the Suez Canal, in the regions international trading.

Conclusion

Cairo is betting on the project for the development of the “Suez Canal axis”, which is anticipated to open investment for the Egyptian economy through the localisation of re-export industries, such as shipbuilding and vehicle manufacturing. Re-export operations would result in major activities in shipping and traffic through the canal, which is expected to increase demand for logistics services, whether fuel supply, maintenance or food supplies in addition to opening tourism opportunities for the vessels’ crews. Traditionally, the only revenue from the Suez Canal has come from transit fees. The Suez Canal Authority announced a record $3.6 billion in revenues for the last fiscal year but that level was  considered below potential and weak, compared to Singapore’s experience in providing logistics services to ships, which generate about ten times as much revenue. A total of 70,679 ships, transporting 4.3 billion tonnes of cargo, transited the Suez Canal in the previous year. The canal last year also recorded the highest number of vessel crossings in one single day, 81 vessels with 6.1 million tonnes of cargo, the highest number of transiting vessels in one day to date.

Royal Caribbean’s Quantum-Ultra-class cruise ship Spectrum of the Seas, the largest passenger ship in the world, crossed the Suez Canal on its maiden voyage. The ship was 347.1 metres long, 41.4 metres wide and displaces 170,000 tonnes. It could accommodate more than 4,200 passengers and has a crew of 1,500. It has reportedly paid about $1 million in transit fees to SCA.The Megamax 24, one of the world’s largest container ships with a capacity of 23,000 containers, also crossed the canal recently. The 400-meter ship had a beam of 61.4 meters, a little under the maximum permissible – 62.1 meters – for transits through the Canal. The 232,000 gross ton ship has a draft of 16 meters, with a total capacity of 23,000 TEUs and the ability to stack 24 rows of containers on board, compared to the previous “Megamax 23” class, with a capacity ranging from 18,000 to 20,000 TEUs in 23 rows. Megamax 23 vessels have a beam of 59 meters. The New Suez Canal is the result of the most recent expansion project of the waterway to accommodate larger vessels, it was inaugurated four years ago on August 6, 2015.

Zaeem Hassan Mehmood, is an alumnus of National Defence University, Islamabad. He is serving as Research Associate at National Centre for Maritime Policy Research (NCMPR)

Middle East

Syrian Refugees Have Become A Tool Of Duplicitous Politics

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Syrian refugees in Rukban camp

Since the beginning of the conflict in Syria the issue of Syrian refugees and internally displace has been the subject of countless articles and reports with international humanitarian organizations and countries involved in the Syrian conflict shifting responsibility for the plight of migrants.

The most notorious example of human suffering put against political games is the Rukban refugee camp located in eastern Syria inside the 55-km zone around Al-Tanf base controlled by the U.S. and its proxies.

According to official information, more than 50,000 people, mostly women and children, currently live in the camp. This is a huge number comparable to the population of a small town. The Syrian government, aware of the plight of people in Rukban, has repeatedly urged Washington to open a humanitarian corridor so that everyone can safely return home. However, all such proposals were ignored by the American side. U.S. also refuse to provide the camp with first aid items. Neighbouring Jordan is inactive, too, despite Rukban being the largest of dozens other temporary detention centres in Syria, where people eke out a meager existence.

At the same time, the problem is not only refugee camps. Syria has been at war for a decade. The country’s economy has suffered greatly over this period, and many cities have been practically grazed to the ground. Moreover, the global coronavirus epidemic didn’t spare Syria and drained the already weakened economy even more. However, Damascus’ attempts of post-war reconstruction and economic recovery were undermined by multiple packages of severe sanctions imposed by the U.S. At the same time, U.S.-based human rights monitors and humanitarian organizations continue to weep over the Syrian citizens’ misery.

The situation is the same for those refugees who stay in camps abroad, especially in countries bordering on Syria, particularly Jordan and Turkey. Ankara has been using Syrian citizens as a leverage against the European states in pursuit of political benefits for a long time. No one pays attention to the lives of people who are used as a change coin in big politics. This is equally true for Rukban where refugees are held in inhuman conditions and not allowed to return to their homeland. In those rare exceptions that they are able to leave, refugees have to pay large sums of money that most of those living in camp are not able to come by.

It’s hard to predict how long the Syrian conflict will go on and when – or if – the American military will leave the Al-Tanf base. One thing can be said for sure: the kind of criminal inaction and disregard for humanitarian catastrophe witnessed in refugee camps is a humiliating failure of modern diplomacy and an unforgivable mistake for the international community. People shouldn’t be a tool in the games of politicians.

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Middle East

Is Syria Ready For Second Wave Of COVID-19?

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©UNICEF/Delil Souleiman

Despite a relative calm that has been holding on the front lines of the Syrian conflict since the beginning of the year, Syria had to face other equally – if not more – serious challenges. The spread of COVID-19 virus in the wake of a general economic collapse and a health care system battered by nine years of war threatened Syria with a death toll as a high as that of resumed military confrontation. However, the actual scale of the infection rate turned out to be less than it was expected considering the circumstances.

Although Syria did not have much in resources to mobilize, unlike some other countries that were slow to enforce restrictions or ignored them altogether, the Syrian authorities did not waste time to introduce basic measures that, as it became obvious in hindsight, proved to be the most effective. A quarantine was instituted in the areas controlled by the government, all transportation between the provinces was suspended, schools and universities were temporarily closed and face masks were made obligatory in public spaces.

As a result, official data puts the number of people infected with COVID-19 in the government areas at modest 4,457 while 192 people died of the infection. In turn, the Autonomous Administration of North and East Syria announced that 1,998 people contracted the virus. The data on the infection rate in the opposition-controlled areas in Idlib and Aleppo is incomplete, but the latest number is 1,072. Compared to the neighboring Turkey with  9,000 of deaths of COVID-19, Syria seems to be doing relatively well.

Tackling the virus put the already embattled health care system under enormous strain. Syrian doctors are dealing with an acute shortage of medicines and equipment, and even hospital beds are in short supply. Over 60 medical workers who treated COVID-19 patients died.

The situation is worsened even further by the economic hardships, not least due to the sanctions imposed on Syria by the U.S. and the European states. Syrian hospitals are unable to procure modern equipment necessary for adequate treatment of COVID-19, most importantly test kits and ventilators.

The economic collapse exposed and aggravated many vulnerabilities that could have been easily treated under more favorable circumstances. A grim, yet fitting example: long queues in front of bakeries selling bread at subsidised prices, that put people under the risk of catching the virus. Many Syrians are simply unable to avoid risking their health in these queues, as an average income is no longer enough to provide for a family.

Moreover, despite a nation-wide information campaign conducted with the goal of spreading awareness about means of protections against COVID-19 like social distancing and mask-wearing, for many Syrians the disease is still stigmatized, and those who contracted it are often too ashamed to go to a hospital or even confess to their friends. As consequence, a substantial number of cases goes unreported.

With the second wave of COVID-19 in sight, it is of utmost importance that the work of health care professionals is supported, not subverted by the citizens. Otherwise Syria – and the world – may pay too high a price.

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Middle East

The role of social responsibility in the policies and economic development of Iran

Sajad Abedi

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Authors: Sajad Abedi and Ghazaleh Aghaei*

Today, social responsibility goes beyond its old concepts, such as altruism and humanitarian aid, and covers the range of government activities at the local, national, and international levels. Since the social responsibility of the government exists in different areas; Therefore, economic policy-making should be done in relation to issues such as social rights, health, private sector activity and the role of companies in economic development. Each of these areas is part of the process of social responsibility and economic policy of governments. Therefore, the government can take more responsibility in the social sphere if, first, it has infrastructural capabilities; Second, to be able to use its capabilities in relation to its social responsibility to society and the power structure in the country.

Moreover, economic development, driven by the promise of eradicating poverty and increasing the well-being of societies, not only failed to overcome poverty, according to statistics; Rather, it had trapped many social classes and nations in the trap of institutionalized and structured poverty. The wealth of the world is increasing by year; But this increase in wealth is not something that is felt by all sections of society, and often, certain groups benefit from it. Another problem of economic development related to social issues has been and is the destruction of the environment. In the 1970s, various voices were heard in human societies about another scandal involving economic development. In fact, it has become widely known that this growth, dependent on increased production and consumption, requires more use of “natural resources” and produces a vicious cycle that results in the destruction of natural resources, environmental pollution, population growth, and so on. It will reduce the quality of life and endanger life on earth, which is contrary to the three principles of sustainable development. Levels related to social responsibilities in a developed society, starting from the individual, reach large government departments, and as we move from individual responsibilities to government social responsibilities, these responsibilities go from components and micro-indicators to Towards the components and macro indicators are inclined.

Levels related to social responsibilities in a developed society

The first level of involvement of social responsibilities in a developed society is individual levels: Individual social responsibility includes the participation of each individual in the society in which he lives and can be attributed to the interest in what happens in society and active participation. Defined to solve some local problems. Citizenship is a concept that is associated with the responsibility and accountability of individuals in society. In civil society, every citizen realizes that the irresponsibility of the people around him puts him on a path of fluctuation, and if he is irresponsible about the phenomena of the environment, he damages his own environment and the lives of others. The most beautiful pleasant feeling in the category of citizenship is the effort to cooperate and bear the responsibility of oneself and others.

Being socially responsible; That is, individuals and organizations must be ethical and sensitive to social, cultural, and environmental issues. Striving for social responsibility helps individuals, organizations, and governments make a positive impact on achieving sustainable development. The life-giving school of Islam, as a complete religion, has moral laws and advice for various aspects of human life, including social life, which every Muslim is required to follow in social relations and behaviors. “Purposefulness”, “being responsible”, “authority”, “having eternal life” and “being two-dimensional” are among the most important anthropological foundations in the school of Islam that make a Muslim a responsible and committed citizen to society can be one of the most important elements in improving the quality of life in the urban structure or sustainable urban development. Of course, every society is changing and has its own life, and every human being can determine his / her responsibility in the society according to the beliefs and culture of his / her society, available hardware and software facilities, governing laws and other variables.

The second level of involvement of social responsibilities in a developed society is the corporate and  organizational levels: In many developed countries of the world, companies are more successful that value their corporate social responsibility. These companies are always striving to create shared value by implementing creative and practical ideas. These ideas are implemented with the support of long-term and very accurate plans that these companies have in the past set goals related to their corporate social responsibility. Sometimes these programs are made available to citizens so that they know what happen, for example, a company will create a common value for society in the next five years and what interests will protect society. The role of companies in sustainable development is divided into three categories: social, environmental and economic. In fact, it is a “sustainable” development in which, in addition to the economic dimension, its environmental and social consequences are also positively managed. With such a view, the exploitation of natural resources and human capital today should not jeopardize the earth, life, benefit and happiness of present and future generations. In fact, demanding organizations to “act responsibly” towards society is an issue that, as their influence grows on the pillars of sustainable development; That is, “economy”, “society” and “environment” intensified in the last decades of the twentieth century and led to the emergence of a concept called corporate social responsibility (CSR) in the world of management to understand the impact of organizations and businesses on sustainable development, it is enough to note that among the top 100 economies in the world, there are more than ten companies. Therefore, the issue of “corporate social responsibility” or CSR has become particularly important in guiding the development process towards sustainability. CSR in a nutshell; That is, organizations are accountable to the community in which they operate; Because they use its human, natural and economic resources. Contrary to the traditional view of management and business, organizations are no longer responsible only to shareholders and should not look only at the profitability of shareholders and based on short-term benefits. Thus, organizations that are in contact with other stakeholders are expected to consider their legitimate demands as well. Beneficiaries; Entities are groups and individuals that affect or are influenced by the organization and cover a wide range; From employees, customers, business partners and local communities to the environment, the media, public institutions, citizens and the government. From this perspective, CSR can be called the integration of social and environmental goals with the organization’s operations and the inclusion of those issues in interactions between the organization and related groups. In general, corporate social responsibility, in a simple definition, includes the responsibilities that firms have towards the community in which they operate. Thus, social responsibility is a voluntary activity based on the ethics of an organization or institution that goes beyond the legal requirements and aims to meet the expectations of stakeholders. In addition, one of the most important features considered for this concept is the emphasis that organizations place on the social system of communities. On the other hand, activities should be such that they have the least adverse effect on society.

The third level of involvement of social responsibilities in a developed society is government levels and the involvement of politics in social responsibilities to create a developed society: The attractiveness of government social policy has no boundaries and relates to all aspects of life at the local level. National, regional and global are considered. All issues related to social security, housing, education, health and social care fall into this area. Planning to achieve such goals will not be achieved through social processes alone. The economic components must also be formed in parallel with the social goals of the government. Topics such as health, education, livelihoods, jobs and money are vital issues that, with the help of government, officials, companies, social groups, economic groups, charities, local associations and other non-governmental are research groups.

In general, the government is not only concerned with social welfare; Rather, it is accountable to economic classes, the mechanism of action of multinational corporations, trade unions, financial institutions, importers, exporters, shareholders, owners of economic enterprises, and other social forces. Theorists believe that economic policy-making in the present age is formed by various government authorities and groups. In other words, various sectors are involved in the economic policy-making process. Each of these sections is a symbol of social activities in communities. Therefore, economic policy-making must be done in a way that meets social needs. Any possible scenario in social policies that lead to the welfare, comfort and cooperation of different social strata; It is part of the governance necessity. In other words, for the welfare of the society, the economic growth of the country, the promotion of the income of various industrial and economic complexes, as well as the reconstruction of the national and global economy, there is no choice but to play the role of government in economic policy; Therefore, it is not possible to consider conditions in which social welfare, economic development and technological advancement can be done without considering the role of government in social accountability and economic policy-making.

If the government fails to pay effective attention to goals such as social welfare and the promotion of national incomes in the economic policy-making process, then there will be manifestations of a welfare state as well as a non-developmental government. In such a process, some theorists emphasize that the main function of the state can not be overshadowed by any other issue. If economic development takes shape; In those conditions, a platform will be provided to increase the level of welfare of the society. That is why in the period of economic growth, the income of the government, society and economic groups increases in parallel. Also, the reduced government budget deficit provides a platform for economic prosperity, investment and the of development infrastructure.

*Ghazaleh Aghaei, Master of Accounting and Audit, Islamic Azad University

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