CAIRO: The Egyptian Joint Stock Navigation Company (EJSNC) is waiting for a decision by Prime Minister Ibrahim Mahlab to be turned into a business sector company, after it fell into debt, Youm7 reported Sunday.
Head of the Egyptian Holding Company for Maritime and Inland Transport (EHCMIT) Mohamed Youssef has sent a letter to Mahlab, requesting that EJSNC fall under the umbrella of EHCMIT to save it from bankruptcy.
The debts of EJSNC have amounted to 100 million EGP ($12.8 million,) and its fleet decreased from 70 ships in the 90s to seven, only two of which operate. It also has become unable to pay the salaries of its personnel, informed sources told Youm7.
If Mahlab approves the request, EHCMIT would be able to pay its dues, allowing the navigation company to sail all over the world, after being restricted from sailing outside Egyptian waters in fear of having its ships confiscated by debtors, the sources added.
Alternatives to save EJSNC include military intervention
Nabil Lotfi, the outgoing head of EJSNC, resigned Saturday after one year in his position, citing health issues, but sources told Youm7 that his resignation comes after his attempts to save the company failed because of lack of attention on officials’ part.
Lotfi’s plan entailed allowing an investor, be it government-affiliated or private, into the company, selling old ships, and purchasing two ships made after 2000 every year for 10 years.
An alternative was to merge the company into the Ministry of Defense’s Marine Industries and Services, as happened with Alexandria Shipyard Company, which was resumed its work and was saved from bankruptcy after the ministry’s intervention, the sources said.
In July, the Egyptian navy rescued 37 people from a sinking EJSNC cargo ship that was on its way from Safaga on the Red Sea to Saudi Arabia; an investigation was opened into the incident after it was revealed that the ship sank due to haphazard loading, without taking the balance of the ship into consideration.
EJSNC was established in 1873 by Khedive Ismail; it was sold to the British later but was bought by Egyptian businessman Abboud Pasha in the early twentieth century. It was eventually nationalized by late President Gamal Abdel Nasser in 1961 and was merged with Alexandria Navigation Company.