On August 6, Egypt inaugurated its “New Suez Canal,” an $8.5 billion expansion of the original Suez Canal, which both deepened and widened the main waterway. Although the expansion has the economic objective of boosting trade by facilitating increased canal traffic, the project is also part of a larger nation-building effort spearheaded by Egyptian President Abdel Fattah al-Sisi.

An inauguration ceremony for the new canal was held in the town of Ismailia on the banks of the Suez.  Festivities extended far beyond Ismailia, though, with spirited celebrations in Cairo and numerous tributes on the Egyptian air wavesThe day was even declared an official holiday by the government and commemorated with  F-16 fighter jet air displays.

The Egyptian state invited thousands of guests to attend a gala in honor of the New Suez Canal. The event was coordinated by WPP, a British PR company, as part of a multi-million dollar campaign to promote the project in Egypt and abroad. The gala was attended by many prominent world leaders, including French President Francois Hollande and Russian Prime Minister Dmitry Medvedev, and featured a flotilla and an opera commissioned specifically for the occasion.

The canal project has been the subject of much nationalist fervor and is being lauded as a triumph against extremism, poverty, and despair, which will catapult Egypt into a new era of prosperity. In an impassioned address during the inaugural celebrations, President Sisi expressed his hope that the canal would boost optimism in Egypt. He dedicated the New Suez Canal to the Egyptian police and military, as well as to the victims of terrorism. Sisi did not, however, include the ten workers who died and 145 who were injured during the canal’s construction in his dedication or otherwise comment on the substandard conditions under which these workers labored.

Even though the new canal has been described as a miracle and a “gift to the world,” it may, in fact, become a liability for the Egyptian people. The government’s decision to prioritize this project over much-needed investments in public services is short-sighted; improvements to the canal’s infrastructure are arguably small and will not attract the kind of revenue needed to justify the costs. The canal is also unlikely to generate more than a modest boost for the Egyptian economy, which will not prevent inevitable austerity measures from being instituted in the near future.

The project, which was announced just one year ago, was completed at a rapid pace. Building efforts were initiated without seriously considering the project’s viability or actual returns, leading Egyptian economist Ahmed Kamaly to conclude that the expansion’s true objective was political rather than economic. As Kamaly said to The Washington Post, “This is politics. [The government] wants to give the impression we are entering a new phase of the Egyptian economy.” As the authors of the Washington Post article, Heba Habib and Erin Cunningham, also noted, “Those pledges of a quick fix for Egypt’s economy may backfire on Sissi, who last year called on Egyptians to finance the new canal through state-issued bonds. Citizens funded the project in just a few days. But as poverty bites hard on ordinary Egyptians, discontent with Sissi’s government is likely to grow.”

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