Issue No.590
Economy
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13 - 19 June 2002 Issue No.590 Economy |
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| Published in Cairo by AL-AHRAM established in 1875 | Recommend this page | ||
Egypt-US: no FTA in sight
Robert Zoellick is the first US trade representative to visit Egypt. Yet Egypt is still no closer to a free trade agreement. Niveen Wahish reports
The setting for the joint press conference by US trade representative Robert Zoellick and Egyptian Minister of Foreign Trade Youssef Boutros-Ghali suggested that something major was in the offing. Perhaps the long-awaited negotiations on a free trade agreement between the US and Egypt.
Robert Zoellick
The press conference was not held in the usual meeting room at the Ministry of Foreign Trade. Instead, two podiums were set up. An unusually large number of journalists, particularly representatives of the foreign press turned up for the event.
However, their hopes for a striking headline were soon shattered. During the press conference and subsequent roundtable discussions at the US Embassy, Zoellick's comments merely reinforced points that visiting US officials had been making for the past ten years. Disappointingly for the business sector, there was no discussion of an Egypt-US free trade agreement (FTA), which would give Egyptian exports a much needed boost.
Zoellick said he had discussed ways to create a closer economic relationship with the Egyptians. At present, Egypt-US bilateral trade amounts to some $4.6 billion.
Zoellick also said that he was impressed by the Egyptian government's efforts to implement reforms where they can and "we want to try to support that".
"We are looking for ways to try to build on Egypt's efforts to try to reform its economy, create a better climate for business and investment and see how we can connect our trade efforts as well as our aid efforts with that," he added. US aid last year amounted to around $650 million. The cumulative figure for the past 20 years has amounted to some $22 billion.
Zoellick's meeting with Minister Youssef Boutros- Ghali also included a follow up on multilateral trade talks. "We need to work on capacity building to help developing countries take part," Zoellick said.
He also stressed that the US and Egypt have a lot in common at World Trade Organisation (WTO) negotiations. "What we want to do is lower barriers to market access, tariffs and other non-tariff barriers," he added.
On a similar note, Boutros-Ghali highlighted that negotiations on the liberalisation of agricultural exports is an area where Egypt and the US have coordinated their positions closely. "We asked the US to support our position on the international arena and push for a liberalisation of agricultural exports. The US coordinated with us on the positions we took. It has also pushed other countries in the international trading system to open their markets to our agricultural exports. Coordination with the US in Doha has been useful and our talks today reassured us that this coordination will continue in the area of greater liberalisation of agricultural exports."
With the FTA not figuring in Zoellick's announcements, the inevitable question on whether Egypt has made any progress regarding what US officials set as preconditions for an FTA was posed.
"These are not preconditions, they are basic elements. They are important in order to move ahead with an FTA," he said
"It's hard to have a trading system if you have complications with your customs," he pointed out. He cited the fact that Egypt has about 52,000 customs inspectors, while the US, which imported $1 trillion worth of goods last year, has only 20,000. He also pointed out that Egyptian and US businesses are having problems valuing goods entering the customs system.
"It is important that Egypt, recognising its own interests, take steps to try to standardise its legal regime with that of the international trading system." He commended the passage of the Intellectual Property Rights (IPR) law and the fact that Egypt has also joined the Basic Telecommunications Agreement in the WTO. It has also submitted information to join the Information Technology Agreement. He added that it is important to recognise that an FTA would involve removing all tariffs and barriers over a period of time. "It's difficult for countries to do this, so we have to lay a groundwork of support."
The US currently has FTA agreements with Canada, Mexico, Israel and Jordan. According to Zoellick it is also in the process of negotiating with Singapore and Chile.
"The reasons we have so few is that we have a particularly high standard for these agreements," he said.
Zoellick and Boutros-Ghali are scheduled to meet in Washington in October to focus in greater detail on what an FTA would look like as well as the issues that set the context for it. However no specific time table for the start of negotiations towards an FTA has been set.
Egypt and the US currently have a Trade and Investment Framework Agreement (TIFA) in place.
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