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Al-Ahram Weekly 17 - 23 August 2000 Issue No. 495 
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Published in Cairo by AL-AHRAM established in 1875 |
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Al-Ahram Weekly 17 - 23 August 2000 Issue No. 495
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| Published in Cairo by AL-AHRAM established in 1875 |
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Egypt Region International Economy Opinion Culture Features Travel Living Sports Profile People Time Out Chronicles Cartoons Letters A mild dose of logic
By Aziza Sami
With political tensions between the US and Egypt riding high the one question on the lips of administration officials in Washington tends to be a variant of "what possible use is Egypt to the US when it is not performing in the Middle East peace process to America's satisfaction?"
For three decades, now, Egyptian-US economic relations have been shaped by the countries' political ties. The time has come, though, to challenge the premise by which economic relations -- initiated in a supremely political context, born with the Camp David peace accords in 1978 -- are invariably linked to Egypt's performance on political issues in which the US is interested.
After almost quarter of a century of US economic assistance to Egypt doubts must be raised over the continuing viability of economic relations in their current form. They can hardly be said, after all, to have led to a more dynamic form of economic interaction. And if US officials are now asking publicly -- for largely rhetorical reasons -- what, if any benefits such aid has bought Washington -- Egyptians, similarly, if for different reasons, question the benefits of continuing the relationship in its present form.
If one were to address a lobby inside the US working towards a constructive relationship between both countries it would be important to stress that a true, strategic economic dialogue is long overdue -- a dialogue, furthermore, that would aim at reformulating economic relations in such a manner that they are no longer hostage to the vagaries of changing political agendas.
What is needed -- beyond the Egyptian government's more constructive encouragement of a positive business climate -- is political will on the part of the US administration to ensure that bilateral economic ties move towards greater parity with the US's ties with Israel.
A trade and investment framework agreement (TIFA) between Egypt and the US has already been pencilled together. But the agreement, falling short of realising a free trade area, has remained low key and generated little publicity, leaving one to speculate that it must either be moribund or working out issues of great portent which cannot be divulged.
As USAID programmes are being phased out, US investments continue at a far lower level than is desired by Egypt. US trade representatives justifiably cite red tape, lack of transparency and an impenetrable bureaucracy as discouraging greater investment in Egypt by US companies. The other side of the coin, though, is that trade policies formally devised in Washington heavily promote US exports while, as one may infer from statements by the current US ambassador to Egypt Daniel Kurtzer -- there is an absence of political will in Washington to provide Egyptian exports with any help in accessing US markets.
Creating a free trade area is the one strategy that might substantially increase Egyptian exports to the US, moving Egyptian goods beyond the limitations set by quotas and the US Ttrade Representative's Generalised System of Preferences.
When goaded, literally, into answering which trade issues exactly TIFA is resolving, US embassy officials reveal that one of its priorities is the creation of Qualified Industrial Zones promoting free trade arrangements involving the US, Israel and any third party. Since such arrangements give Israel a vast advantage within regional markets it is understandable that US representatives are keen to downplay the true intentions of their policies.
If the US wishes its oft-repeated claims that a "strategic relationship" exists with Egypt not to become yet another example of hollow, meaningless rhetoric, it really has to drop its assumption that Egyptians are somehow miraculously unaware of where current policies are actually leading.
And even if, as was always the case with USAID, trade initiatives are viewed by Washington as a tool of US foreign policy, and nothing else, is it not in America's interests to allay regional political tensions by forging closer trade ties with Egypt rather than the opposite?
For trade and investment to degenerate into pressure cards played whenever it is opportune acts against establishing an economic climate in which anyone will want to invest anyway. It is a policy that can only self-destruct.
