The Profitability of the Suez Canal as a Private Enterprise, 1859–1956

On the basis of published accounts, internal rates of return and present values are computed for capital in general and for particular investors (French shareholders and the British and Egyptian governments) from construction to nationalization of the canal. Terminal values at the nationalization had to be imputed. Rates of return are compared with opportunity costs represented by the return on alternative investments. For capital generally, French shareholders, and the British government, rates of return were 8–9 percent against opportunity costs of 3–4 percent. For the Egyptian government, corresponding figures were 2–5 and 11 percent. American investment would not have been profitable.