Moodys says receipts will probably fall short of Suez Canal Authority forecasts
- Moodys expects limited credit-positive effects for Egypt in the current fiscal year
- Suez Canal Authority expects receipts from passage tolls to rise to $13.2bn annually by 2023
US-based credit ratings agency Moodys Investors Service is predicting that revenues from the Suez Canal are likely to fall short of official forecasts.
In a statement released on 13 August, the company says the Suez Canal Authoritys forecasts rest on the assumption of an unlikely sharp recovery in global trade growth.
The authority expects receipts from passage tolls in the Suez Canal to rise to $13.2bn annually by 2023, which is more than twice the $5.4bn recorded in 2014.
Moodys says world trade would have to grow by about 10 per cent a year year between 2016 and 2023 to achieve the projected $13bn in annual revenues.
We expect only limited credit-positive effects for Egypt during the current fiscal year, the company says in the statement.
While Moodys says the short-term benefits for the project are unlikely to live up to expectations, it says the canal expansion will have a positive impact on Egypts economy over the long term, increasing current account receipts and government revenue.
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