Possibilities And Opportunities Of Transition To The Blue Economy in Egypt

The importance of the blue economy emerges as a lifeline for the countries of the world from their economic crisis and a key to solving many environmental problems and confronting climate change, and a front for investment that provides job opportunities and improves the standard of living, confronts poverty and supports sustainable food and water security.

The blue economy is applied to the coastal sectors, marine life and activities, as it is the economy that gives priority to the three pillars of sustainability: economic, environmental and social, and then promotes sustainable development, greatly reducing environmental risks and ecological scarcity, as well as paying attention to renewable energy, waste management, consumption and production. sustainable. It focuses on new and emerging paradigms such as the circular economy, the collaborative economy, and the functional economy. This is in addition to creating a more inclusive market that integrates the true environmental and social cost of products and services.

This paper aims to analyze the potentials and opportunities of transition to the blue economy in Egypt by identifying its concept and the development of its indicators in Egypt, presenting the potentials and opportunities of the blue economy for Egypt in the Red Sea region and the Mediterranean region, with an explanation of the most prominent challenges facing the sectors of the blue economy in Egypt, and finally The paper identifies ways to achieve maritime safety and security of blue economy activities.

The paper reached the following results:

1- The number of Egypt’s reserves has reached 30, representing 13.5% of the total area of ​​the Republic

2- Egypt has about 53 seaports, of which 15 are commercial and 38 are specialized

3- The area of ​​​​the coral reefs, which is famous for the Red Sea region, is 3412 km

4- Beach tourism accounts for more than 90% of incoming tourism to Egypt

5- The value of fish production in Egypt amounted to 63 billion pounds in 2020

6- 25% of the world’s trade passes through the Suez Canal

7- 30% of the global container traffic passes through the Suez Canal, and the value of goods is estimated at more than 1 trillion US dollars annually. There are 50 ships a day that make the trip between the port of Suez and Port Said, carrying between 3-9 billion dollars in goods

8- An estimated 7-10% of the world’s oil and 8% of liquefied natural gas is transported through the Suez Canal, in addition to the approximately one million barrels of oil that cross the canal daily

First: The concept of the blue economy and its objectives

The concept of the “blue economy” is taking root day after day, imposed by the rapid changes in many areas of life, including economics, development, environment and sustainability, especially after the “Rio +20” conference in 2012, and it emphasizes protecting the sustainable management of water resources and preserving systems sound ecology, especially in the oceans.

the Food and Agriculture Organization of the United Nations (FAO) launched the “Blue Growth Initiative” Within this direction,, and has sought to support the transition to this new approach, and to assist countries and governments in developing and implementing policies that enhance the concept of the blue economy.

There are many economic activities that can be practiced through the blue economy. In addition to fishing activities and the establishment of fish farms, there are other sectors such as shipping, ports, logistics, mining, marine exploration, energy transmission and generation, ship and boat manufacturing, marine tourism and entertainment activities, as well as the technology, information and vital blue technology sectors.

The blue economy aspires to further harness the potential of the oceans, seas and coasts to eliminate harmful fishing practices that contribute to overfishing, and instead stimulate approaches that promote growth, improve conservation and build sustainable fisheries, end illegal and unregulated fishing.

Among its adoption of the blue economy, the (FAO) set several goals, most notably the interest in aquaculture by promoting good policies and practices for the responsible and sustainable cultivation of fish, shellfish and marine plants, and natural fisheries by supporting rational fishing, restoring fish stocks, combating illegal fishing, and promoting practices Good for fish production and growth in a sustainable manner, as well as paying attention to seafood systems, promoting efficient value chains for seafood, improving livelihoods, strengthening regulatory systems, biodiversity and ecosystem services.

This economy also focuses on creating job opportunities, building community capital, and achieving multiple cash flows, by stimulating entrepreneurship and creating practical models in this field, preserving the environment and devoting the concept of sustainability.

Second: The development of blue economy indicators in Egypt

Egypt has an enormous water wealth, with a length of about 3,000 km of beaches, about 1,150 km on the Mediterranean Sea and 1,850 km on the Red Sea. It owns about 53 seaports, including 15 commercial ports and 38 specialized ports, and the estimated incoming and outgoing volume of Egyptian port authorities during 2021 is about 162.8 million tons, through 11.59 thousand ships.

The number of Egypt’s reserves reached about 30 natural reserves in 2020, representing 13.6% of the total area of ​​the Republic, as shown in the following table:

Table No. (1) Natural reserves in Egypt 2020

Source: Central Agency for Public Mobilization and Statistics, Annual Environment Statistics Bulletin, Part I, Environment Conditions and Quality 2020, August 2022

Figure No. (1): Percentage of the area of ​​natural reserves out of the total area of ​​Egypt in 2020

Source: Central Agency for Public Mobilization and Statistics, Annual Bulletin of Environment Statistics, Part One: Environmental Conditions and Quality in 2020, August 2022 Issue

Marine reserves represent about 0.3% of the total nature reserves in Egypt, as shown in the following figure:

Figure No. (2) Natural reserves by type in Egypt in 2020

Source: Central Agency for Public Mobilization and Statistics, Annual Bulletin of Environment Statistics, Part One: Environmental Conditions and Quality in 2020, August 2022 Issue

The area of ​​​​the coral reefs, which is famous for the Red Sea region, is about 3412 km2, and the percentage of the area affected by coral bleaching is 0.7%, as the following table indicates:

Table No. (2) Area of ​​coral reefs, percentage of area affected by coral bleaching, and area of ​​mangroves in the Red Sea in 2020

Source: Central Agency for Public Mobilization and Statistics, Annual Bulletin of Environment Statistics, Part One: Environmental Conditions and Quality in 2020, August 2022 Issue.

Egypt is also distinguished by beach tourism in addition to yacht tourism, diving and fishing, as beach tourism accounts for more than 90% of the incoming tourism movement to Egypt, and the tourism sector contributes about 11.9% of the gross domestic product, and absorbs about 12.6% of the total employment, and participates with about 21% of the total population. Total non-commodity exports, 19.3% of foreign exchange earnings, and the growth rate of the sector was 16.5% in 2019.

As for fish production, fish farms, and self-sufficiency in fish, it is evident through the following charts:

Figure No. (3) The value of fish production in Egypt until 2020

Source: Central Agency for Public Mobilization and Statistics

The value of fish production amounted to 63 billion pounds in 2020. It has been increasing at high rates since 2015, reaching 23 billion pounds.

Figure No. (4) The area of ​​fish farms in Egypt until 2020

Source: Central Agency for Public Mobilization and Statistics

Figure No. (5) Percentage of fish farms and rice fields for fish production in Egypt until 2020

Source: Central Agency for Public Mobilization and Statistics

Figure No. (6) Percentage of self-sufficiency in fish in Egypt until 2020

Source: Central Agency for Public Mobilization and Statistics

The figure shows a decrease in the self-sufficiency rate of fish in Egypt in 2020, to reach 16%, after it reached 80% in 2019

Third: The potential and opportunities of Egypt’s blue economy in the Red Sea region

The importance of the Red Sea is increasing with its riches, ports, and ability to communicate, as well as its political weight in shaping the parameters of the next stage. And the formulation of countries’ economic and political relations and interests in the medium and long term. Key indicators confirm the growing importance of the Red Sea region, which include the increasing importance of international navigation, and the significant increase in the region’s ability to provide energy resources.

A- Energy resource:

The signing of the maritime border demarcation agreement between Egypt and Saudi Arabia  contributed in attracting the interest of many international companies to explore in the Egyptian territorial waters after three sectors for exploration in the Red Sea were awarded to American Chevron, Dutch Shell, and Emirati Mubadala companies at the end of December 2019. The three are about oil and gas in an area with a total area of ​​ten thousand square kilometers. The new oil discoveries extend from the Red Sea coast to the Gulf of Aden.

The Red Sea is a passage for about (3.3) million barrels of oil per day, which made securing the waterways in that region a vital matter, protecting the international trade movement, in addition to the land area, which also represents the starting point from warm waters to land, all the way to To the heart of Africa, thanks to which the interdependence between land and sea is achieved together.

B- International navigation:

The growing strategic importance of the Red Sea as a major international shipping lane is reinforced by the rapid population and economic growth of its countries. This increase is driven by the efforts of the countries of the region and the countries investing in it in strengthening the infrastructure for economic activity.

Maritime transport is one of the pillars of economic development and the artery of the global economy to various countries of the world, as it transports 90% of the total volume of world trade. Ports and the maritime merchant fleet play a major role in facilitating the movement of goods, reducing transport prices, and advancing economic development and the global logistics system. Examples of this development trend are as follows:

1-Development axis of the Suez Canal:

It is one of the important strategic axes, for which the new Suez Canal was established, as 25% of the world’s trade passes through the navigational corridor of the Suez Canal, and there are international companies that have started investing in the Suez Canal axis, and indeed the first stages of more than one industrial zone have been completed. Most notably the Chinese region.

30%of the global container traffic passes through the Suez Canal, and the value of goods is estimated at more than 1 trillion US dollars annually. In 2020, about 19,000 ships used this route, representing 50 ships per day making the journey between the port of Suez and Port Said, carrying between 3-9 billion dollars of goods, and the waterway transported more than 1 billion tons of goods in 2019, which is It represents four times the tonnage transiting the Panama Canal over the same period.

The canal’s location also makes it a major regional hub for the shipping of oil and other hydrocarbons, enabling the transportation of an estimated 7-10% of the world’s oil, 8% of liquefied natural gas, and nearly 1 million barrels of oil transiting the canal daily.

2-Safaga port

The Safaga sea port is one of the most important ports overlooking the Red Sea. It is being developed by the multi-purpose terminal, Safaga 2, at a cost of about EGP 3 billion, on an area of ​​810,000 square meters, with berths lengths of 1,100 meters and a depth of 17 meters. The station accommodates about 2 million containers and 7 million tons of general cargo annually, in addition to To develop the existing berth, increase its length and depth, and a truck yard that includes all the administrative and technical needs of trucks to prevent congestion in front of the port.

There are many infrastructure development works in the economic zone of the Suez Canal and the southern region of Ain Sukhna, to raise the efficiency of the Egyptian ports overlooking the Red and Mediterranean seas, in line with the state’s plan to develop the Suez Canal axis.

3-Adabiya port

The port of Adabiya received 146 uncontained general cargo ships with a tonnage of more than 1.1 million tons, and 40 containerized general cargo ships with more than 88 thousand containers with a total tonnage of approximately 930 thousand tons. It also received 87 dry bulk vessels with a total tonnage of nearly 2.75 million tons, and 138 A liquid bulk vessel with a gross tonnage of about 1.72 million tons, with a container growth rate of 12% over the previous year.

4-Al-Arish port

The port was developed through the implementation of works for the first basin, which included the construction of new berths with a length of 915 m, bringing the total length of the berths to 1165 m, and roads, squares and berths are being constructed at a cost of 4 billion pounds. Immediately after its restart, the port of Arish received 50 ships with a total tonnage exceeding 216 thousand tons.

The revenues of the General Authority for the Economic Zone of the Suez Canal at the end of the fiscal year 2020/2021 amounted to about 3.2 billion pounds, despite the rationalization and spending reduction policies that the authority follows. The value of fixed assets increased by 2.3 billion pounds; To become 7.5 billion pounds, and this increase in assets is due to the establishment of many infrastructure projects, including the sea water desalination plant in Ain Sukhna with a capacity of 100 thousand m3 / day, the establishment of a transformer station in Port Said Port, and the carrier line for desalinated water in the industrial zone in Sukhna.

Figure No. (7) Gulf countries’ investments in the Red Sea region

The previous figure indicates the investments of a number of Gulf countries in the Red Sea region, where the UAE came in first place, having invested $69 billion, followed by Saudi Arabia, with its investments in the countries of the region amounting to $29 billion, then Qatar with $22 billion, followed by Kuwait, with its investments 12 billion dollars, then Bahrain 3 billion dollars, and finally Oman invested 162 million dollars.

Egypt was the first recipient of these investments, earning $119 billion, followed by Sudan, $8 billion, Ethiopia, $5 billion and finally Djibouti, $4 billion.

Figure No. (8) The most important economic opportunities in the Red Sea region

Source: Liuigi Narbone and Cyril Widdershoven: the Red Sea Link. Geo-Economic Projections, Shifting Alliances, and the Threats to Maritime Trade Flows.

The previous figure indicates the most important economic opportunities and activities in the Red Sea region represented in ports, logistics services, marine services, manufacturing, communications technology, and energy. These opportunities are expected to contribute to creating one million jobs over the next 15 years.

The most important economic opportunity for the Red Sea countries is the establishment of an Arab-African economic grouping that includes the countries of the region, and takes the blue economy as a basis and a starting point, within the scope of the United Nations Sustainable Development Goals 2030 and the Africa Development Plan 2063.

Infrastructure, energy, rural and agricultural development sectors are a priority for achieving development in the Red Sea region, while not neglecting other sectors such as industry, health, education and the environment, and focusing support on activities aimed at alleviating poverty, securing food and encouraging women’s participation in development, in addition to supporting projects Social, as well as benefiting from experiences related to the exchange of raw materials, services and technology in the implementation of projects.

fourth: The potential of Egypt’s blue economy in the Mediterranean region

A-Fisheries and aquaculture

Fisheries revenues in 2018 for the Mediterranean region increased about 10% and total revenues from 2013 to 2018 range between 3.2 and 3.7 billion euros. Aquaculture production has increased over time to meet the demand for fish as live stocks decline. This sector is expected to continue to develop and diversify as demand for fishery products for human consumption increases and wild stocks continue to decline by 2025.

B- Coastal and marine tourism

This sector represents 30% of global tourist flows and hosts the leading tourist destinations in the world. This sector is a volatile sector that is vulnerable to the effects of climate change (such as coastal erosion) and global shocks (financial crises, epidemics, etc.), and the clear need for structural changes towards economic models appears. More environmentally sustainable and socially resilient, building on local strengths to ensure local returns.

2019 is the year of tourism in the Mediterranean region with 22.1 million passengers. The distribution of arrivals and revenue varied greatly across the region and the total contribution was estimated at $901 billion in 2015, with only 58 billion arriving in North African countries.

Figure No. (9) Number of international tourists coming to Egypt and the Mediterranean countries

Source: Union for the Mediterranean: Towards a Sustainable Blue Economy in the Mediterranean Region, 2021

C- Marine renewable energies

Marine renewables given prominent role in European green deals and Covid recovery package A total of 70 gigawatts of offshore wind power production will be placed in southern European waters by 2040 and ocean-based renewables could meet nearly 10% of annual emissions reduction The greenhouse gases needed by 2050 to keep global temperatures below 1.5°C, and this can be achieved through the use of ocean-based renewable energies.

The renewable energy sector is a fast-growing sector with great potential in terms of technological development and job opportunities. Floating wind turbine technology is considered the most suitable for the Mediterranean due to its potential for deployment in deep waters.

D- Ports and maritime transport

Merchant shipping is a key driver of global growth, covering about 80% of global trade. The sector is a key component of the economy and job creation across the Mediterranean, but is also vulnerable to market fluctuations and international crises. This makes it a relatively volatile source of growth and jobs in a world increasingly exposed to shocks.

International maritime transport witnessed an average growth of between 3% and 3.5% during the period (2005-2018), and about 4% in 2019, and 10% of global cruises were hosted in the region, with approximately 2.5 million passengers in 2019 and short sea freight It represents an increasing proportion of this traffic, and the continuous expansion of seaports, with differences in structures and administrative characteristics across ports and countries in the Mediterranean. North African ports have increasingly established themselves as key points in an important shipping network.

E- Marine research and innovation

Research and innovation are the main backbone driving a sustainable blue economy in the Mediterranean. To be fully effective and impactful, research and innovation activities must reflect the specific needs and opportunities of the region, and greater collaboration and a stronger sense of regional community are essential.

BLUEMED is an initiative that aims to support a sustainable blue economy across the sea basin and has been formed in an organized framework over the past years. The agenda identifies a set of key challenges, knowledge gaps and enabling activities, as well as capacity building and skills enhancement measures. An implementation plan was drafted in June 2020, as a result of the priorities put forward by each Mediterranean country.

Figure No. (10)

Source: Union for the Mediterranean: Towards a Sustainable Blue Economy in the Mediterranean Region, 2021

Fifth: Challenges facing the sectors of the blue economy in Egypt

The most important challenges facing the blue economy sectors in Egypt are as follows:

1- Ongoing adverse effects on natural ecosystems caused by unsustainable business models, as natural assets are highly vulnerable to the impacts of climate change and related challenges.

2- Lack of market readiness for zero-emission technologies, large investment requirements in ship refueling equipment and infrastructure, and international competition in the sector.

3- There are still discrepancies in research and development capacity, aligning research and innovation efforts more closely with business needs.

4- The continuing mismatch between the skills of the labor force and the evolving needs of the blue economy sectors

5- Carefully targeted education and employment policies must reflect regional characteristics to be effective as a means of ensuring more job opportunities and quality jobs in the blue economy

Figure No. (11) The 10 most common types of marine litter in the Mediterranean

Source: Union for the Mediterranean: Towards a Sustainable Blue Economy in the Mediterranean Region, 2021

 It is estimated that plastics and microplastics constitute 70-90% of the total composition of marine debris in the Mediterranean basin, and 0.57 million tons of plastic are released into the waters of the Mediterranean Sea every year, which is equivalent to 33,800 plastic bottles thrown into the sea every minute. It is estimated that approximately 62 million pieces of large litter float on the surface of the entire Mediterranean basin, marine litter has been shown to directly affect living organisms.

There are relevant initiatives and projects at the Mediterranean level that deal with marine litter such as (Blomed initiative model for a plastic-free Mediterranean Sea, Plastic Busters project, COMMON).

Sixthly: Ways to achieve maritime safety and the security of blue economy activities

1- Ensuring a high level of maritime safety and security for the development of a sustainable blue economy.

2- Reinforcing the active role of the Regional Mediterranean Coast Guard Jobs Forum and promoting understanding of maritime issues of common importance and common interests related to coast guard functions across borders and sectors, both civil and military.

3- Developing training activities and further facilitate the exchange of information, expertise, technical assistance, training and best practices to address illegal activities at sea.

4- The importance of improving maritime safety, in accordance with the conventions of the International Maritime Organization, and the ability to prevent and respond to natural and man-made disasters, as well as pollution from ships.

5- Continuing to carry out the necessary local reforms to create a more suitable environment for investments