Canal Istanbul and shipping

Canal Istanbul for shipping is an extremely exciting project but not without it’s critics. The project: An artificial sea-level waterway connecting the Black Sea to the Sea of Marmara. Combining a path from the Black Sea to the Aegean and Mediterranean Seas.

This project isn’t the first major logistics project Turkey has undertaken in recent years. Seeing itself as a gateway for trade it’s new airport in Istanbul and the expansion of Turkish Airlines has been impressive. Making Turkey a central hub for international trade.

Canal Istanbul will help transform the Black Sea into a major trade lane for shipping.

Why is Canal Istanbul needed

As ships get bigger the pressure on the Bosporus continues to increase. This natural waterway exists and links the Black Sea to both Marmara and the Aegean. Being just under 17 nautical miles long it will be shorter by 11 miles than the Canal Istanbul project. It is a challenge to pass through. Not least it is naturally very narrow and winds with some very sharp turns. Not really suitable for heavily-laden mid sized ships.

With larger and heavier ships the Bosporus and Turkish Straits have become crowded and potentially dangerous over the last 20 years. At specific points course alterations at severe bends with a fast moving current hamper vessels where ships approaching from the opposite direction cannot see around the bends. the Canal Istanbul project being man-made does away with the natural bends the Bosporus contains. Allowing for a more manageable passage across Turkey and beyond.

Canal Istanbul’s potential benefits

Turkish President Recep Tayyip Erdogan has given the green light. Work began on the 26th June. The canal is thought to be a 6 year build. Potentially costing $15bn to complete. First mooted in 2011 in 10 years it has become a reality.

The benefits to Istanbul itself are easy to see. Reduced shipping in the Bosphorus strait and a secured revenue stream to use the canal are attractive to Turkey. Outside of Istanbul you can often see ships waiting to pass down the Bosphorous which forms a bottle-neck for transport. The Canal will transform this as by it’s nature it will be easier to maintain and allow an easier navigational passage. Couple that with a charge based on vessel size to use the canal and Turkey has a new and potentially lucrative revenue stream. This could come at a heavy cost.

Some doubt the proposed benefits

All major infrastructure projects raise questions. The Canal Istanbul project is no exception. In an area which is prone to earthquakes some question the possible increased risks of ecological harm. Indeed a straight canal transferring water from the Black sea directly into the Marmaras could have profound effects on the ecology within the region. In recent years new pipelines for oil and gas has seen traffic reduce by over 24% through the Bosphorous. From 54,400 vessels per year to 41,100. This has also seen a reduction in accidents. Since 2003 – 2018 vessel accidents are down by a third. The question of the necessity of this project is one some critics argue is worth asking.

With the reduced vessel numbers and access to the Bosphorous still available will the project generate as much revenue as claimed. The time saving may encourage some to use the canal but many may not.

Reports suggest that the Turkish government in 2019 paid more than $515 million to the bridge operator to cover shortfalls in anticipated toll revenues. The Canal Istanbul project has similar guarantees. If ship numbers using the canal are not as anticipated the government will need to make up the short-fall. Leaving Turkish tax-payers to foot the bill.

Will the project be a success

Only time will tell. Whether the shipping industry wants or needs it is another matter. I have not seen anything from any major shipping line coming out in support of the project. When coupled with the new major airport and major motorways that Turkey has built the country’s logistics infrastructure has improved considerably. However some would argue that the country is yet to realise the benefits. Instead the foreign investment and the way these deals are structured may harm the country for generations to come. Both financially and ecologically.

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