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Amr Nabil, Associated Press
Egyptian army soldiers patrol the Cairo-Ismailia desert road in Egypt, Thursday, Aug. 6, 2015. Egypt is to unveil a major extension of the Suez Canal that el-Sissi has billed as a historic achievement that will boost the economy following years of unrest. Arabic on the army vehicle reads, "forces securing the inauguration ceremony of the new Suez canal."

ISMAILIA, Egypt — Egypt on Thursday will unveil a major extension of the Suez Canal that President Abdel-Fattah el-Sissi has billed as an historic achievement which will boost the country's ailing economy after years of unrest.

An elaborate ceremony in the canal city of Ismailia will be hosted by the president and attended by foreign dignitaries amid tight security measures following a series of attacks by Islamic militants in the Sinai Peninsula and the capital.

The unveiling of the $8.5 billion extension has been trumpeted as a historic achievement by pro-government media and has revived the nationalistic personality cult built around the 60-year-old el-Sissi, who as army chief led the overthrow of an Islamist president in 2013 and was elected to office last year.

Egypt's black, white and red flag now adorns streets across much of the nation, along with banners declaring support for el-Sissi and hailing his latest achievement. The government declared Thursday a national holiday, and banks and most businesses were closed.

Economists and shippers have questioned the value of the project, saying the increased traffic and revenues the government is hoping for will depend more on the growth of world trade than the size of the crucial waterway, which links the Red Sea to the Mediterranean and allows vessels to avoid sailing around Africa.

But the government says the $8.5 billion project, funded entirely by Egyptian investors, will more than double the canal's annual revenue to $13.2 billion by 2023, injecting much-needed foreign currency into an economy that has struggled to recover from the 2011 uprising that toppled President Hosni Mubarak and the years of turmoil that followed.

The new extension involved digging and dredging along 72 kilometers (45 miles) of the 193-kilometer canal, making a parallel waterway at its middle that will facilitate two-way traffic. With a depth of 24 meters (79 feet), the canal now allows the simultaneous passage of ships with up to 66 ft. draught.

The project was initially estimated to take three years, but el-Sissi ordered it completed in one.

"Egypt makes history," read the banner headline of Thursday's pro-government daily Al-Watan. The front page of another daily, Al-Maqal, said "Rejoice, it is worth it!"

Thursday's ceremony will be partially overshadowed by an Islamic State affiliate's threat to kill a Croatian hostage kidnapped in Cairo last month, a grim reminder of the threat posed by Islamic militants to Egypt's stability.

The affiliate, the Sinai Province of the Islamic State, released a video Wednesday threatening to kill the Croatian in 48 hours if Egyptian authorities do not release "Muslim women" held in prison, a reference to female Islamists detained in the government's broad crackdown against supporters of Morsi.

Egypt has seen a surge in attacks by Islamic militants since Morsi's ouster, in both the restive north of the Sinai Peninsula and the mainland, focusing primarily on security forces.

Foreign interests also have also been targeted, including the Italian Consulate in Cairo, which was hit with a car bomb last month. That came just days after another bomb killed Prosecutor General Hisham Barakat in an upscale Cairo neighborhood.

However, Wednesday's video was the first to be released by Islamic militants showing a kidnapped foreigner in Egypt, an ominous escalation as the country tries to rebuild its vital tourism industry. The professionally-made video resembled clips released by the IS group in Syria and Iraq, indicating closer ties with its Egyptian branch.

The government says it has taken major steps to prevent anyone from disrupting Thursday's ceremony, and pro-government media have portrayed the canal extension itself as a victory over extremism.

"Rejoice for it is a victory over terror," wrote Al-Maqal's editor and prominent commentator Ibrahim Issa. "Rejoice, for it is a tremendous win for a country suffering from the blows of terror."