Suez Canal

The Isthmus of Suez, a 105-mile slip of land at the western extreme of the Sinai Peninsula, separates the Mediterranean Sea from the Red Sea. Ever since pharaonic times it has attracted merchants and empire builders because it offers the shortest route between these two important bodies of water. Approximately 4,000 years ago Egyptian pharaohs of the Twelfth Dynasty constructed a canal that joined the Red Sea with the Nile Delta, thereby facilitating Egypt's trade with the East. Although the canal fell into disuse, Ptolemy II reexcavated it around 250 b.c.e., restoring it to commercial importance. It again fell into disuse, and plans to revive a canal did not appear again until the French invaded Egypt in 1798.

EUROPEAN INTERESTS

The young Napoleon Bonaparte (1769–1821), who led 36,000 soldiers into Egypt in 1798, envisioned making Egypt a French colony. To this end, he took with him a number of scholars who were eager to transform Egypt through colonialism. Among them was an engineer, J. M. Lepére (1763–1841), who made the first modern survey of the isthmus, wrongly concluding that the Red Sea was more than 32 feet higher than the Mediterranean and that a canal would require an expensive series of locks. Lepére's miscalculation did not deter later groups, however, mostly French engineers, who continued to dream of a canal that would unite Asia and Europe. But the interested powers were not supportive. The modernizing ruler of Egypt, Muhammad Ali (1805–1848), feared that a canal would impinge on the autonomy of his country. So did the Ottoman sultan, who still had formal jurisdiction over Egypt. Britain supported the Ottoman state against Russian expansion toward the eastern Mediterranean, and so also opposed any canal project.

A French entrepreneur, engineer, and diplomat, Ferdinand de Lesseps (1805–1894) did not let these international pressures deter him. Exploiting the friendship that he had cultivated with Egypt's new ruler, Abbas Pasha (1854–1863), and the desire of many members of the Egyptian elite to be seen as part of the European community of nations, de Lesseps gained concessions in 1854 and 1856 that allowed him to establish a private, Egyptian-registered construction company, which would cut through the Isthmus of Suez and join the Mediterranean and the Red Sea. In 1858, with nearly 92 percent of the financial backing coming from small French investors and from the Egyptian government, de Lesseps announced the foundation of the Suez Canal Company.

Constructing the canal itself proved difficult, but eleven years later it opened to traffic amidst great fanfare. On November 17, 1869, following the excavation of 99.4 million cubic yards of earth and at a cost of £18.144 million (sterling), well in excess of the original estimate, the first ships made their way through a channel that was 98 miles long, 28 feet deep, and along most of the way able to accommodate traffic in only one direction. Ships wishing to traverse in the opposite direction had to wait in the fortuitously located lakes along the canal's route.

Despite British opposition to the canal, British shipping quickly dominated its traffic. The canal dramatically shortened the route to the East, which previously had gone around the Cape of Good Hope in South Africa. Still, it was some time before steam shipping through the canal was economically competitive with sailing around the South African Cape. Indeed, in the first year of the canal's existence the Suez Canal Company's results were deeply disappointing. The total tonnage that passed through the canal was a mere 22 percent of what the Canal Company had predicted, causing a financial loss of £383,570 (sterling).

Even so, the significance of the new canal was obvious to the European powers, which moved rapidly to gain fuller control of it. By 1875 the new Egyptian ruler, Khedive IsmaEil (1863–1879), on the verge of bankruptcy, placed the Egyptian government's 44 percent of the company's equity capital on the market. The British prime minister, Benjamin Disraeli (1804–1881), quickly acquired these shares for his government, making Great Britain the largest shareholder of an Egyptian-registered company that had its main administrative offices in Paris and was run mainly by French engineers and financial specialists. In 1888, at a conference in Constantinople, the major European powers signed a convention guaranteeing freedom of transit through the canal in times of war and peace for all ships, commercial and military. Although the concession of 1856 had promised freedom of passage, this had been abridged during the 1877 Russo-Turkish conflict and again in 1882 when British forces occupied the country militarily.

By 1880 the canal was the primary means of communication between Europe and the Orient. Cheaper, faster transit stimulated frozen meat exports from Australia and the export of tea, jute, rice, and other commodities from India and other parts of Asia. One major beneficiary was the city of Bombay, which became the primary port of call for European shipping to and from India, supplanting the old capital of British India, Calcutta. A new product appeared at the close of World War I that would dominate future canal traffic. Oil exports from countries east of Suez, notably Iraq, Iran, and Saudi Arabia, transited the canal and fueled Europe's industrial growth.

Oil exports, however, put new pressures on the Canal Company. As the tankers increased in size, the company had to deepen and widen the Suez channel in order to keep the biggest tankers from using the Cape route. Whereas the canal had originally been 200 feet wide at the surface and 72 feet wide at its maximum depth of 26 feet, by 1956 repeated and expensive efforts had made it 500 feet wide at water level and 196 feet wide at a depth of 35 feet. These improvements paid off amidst growing world trade. From fewer than 500 in 1870, annual transits reached more than 20,000 in 1966, with most of the traffic moving from the oil-exporting countries to Europe.

NATIONALIZATION OF THE CANAL

Abbas's original concession to the Suez Canal Company was to run for ninety-nine years from the opening of the canal, at which time (1968) the company would revert to the Egyptian government. Company efforts to extend the concession failed, and after World War II, with nationalist pressures mounting throughout the Middle East and the company accruing record profits, company officials and Western diplomats feared nationalization. This prospect became a reality on July 26, 1956 when the military regime, led by Gamal Abdel Nasser (1918–1970), announced to a stunned international community that Egypt would take over the canal, promising to compensate the company's shareholders at the current price of their shares. The Egyptian populace, for whom the canal had become the most glaring symbol of the exploitative nature of European imperialism, was gleeful. Not only had the existence of the canal provoked the British occupation of the country, but since IsmaEil's shares wound up in British hands in 1875, Egypt had received minimal returns on an undertaking for which they had supplied a huge quantity of labor and nearly half of the original financing.

British, French, and Israeli troops invaded Egypt in October 1956, seeking to restore international control over the canal and to unseat Nasser. Lacking support from the United States, the invading powers were forced to withdraw. After a brief closure, Egypt's government-run Canal Authority ran the canal successfully, thereby proving wrong critics who had argued that the Egyptians would be unable to do so. The canal closed again as a consequence of the Arab-Israel War of June 1967, but was reopened in 1975 as part of improving relations between Egypt and Israel. The Egyptians have proven expert administrators of the canal, which continues to be a major artery of international communication and an important source of hard currency for the Egyptian government.

SEE ALSO Ali, Muhammad; Bonaparte, Napoleon; Canals; Containerization; Egypt; Empire, British; Empire, French; Empire, Ottoman; Imperialism;Mediterranean;Indian Ocean;Nationalism;Nationalization;Persian Gulf;Shipping Lanes;Ships and Shipping;Ship Types.

BIBLIOGRAPHY

Bonin, Hubert. Suez, du canal à la finance (1858–1987) (Suez: From Canal Company to Financial Company 1858–1987). Paris: Economica, 1987.

Farnie, D. A. East and West of Suez: The Suez Canal in History, 1854–1956. Oxford, U.K.: Oxford University Press, 1969.

Georges-Picot, Jacques. The Real Suez Crisis: The End of a Great Nineteenth-Century Work, tr. W. G. Rogers. New York: Harcourt Brace Jovanovich, 1978.

Robert Tignor