US defers Egypt FTA

Apparently an US-Egypt Free Trade Agreement is yet again being postponed.

WASHINGTON (Reuters) - The United States has not decided yet whether to begin free trade talks with Egypt, a U.S. trade official said on Tuesday, amid U.S. concerns about Cairo's commitment to democratic reforms.

"The decision will be made when the United States and Egypt together deem it to be the most appropriate way to move the relationship forward," said Christin Baker, a spokeswoman for the U.S. Trade Representative's office.

Baker was responding to a Washington Post editorial, which said the Bush administration had told a Egyptian trade team not to come to Washington this month for previously scheduled talks to discuss the proposed trade pact.

Just a few months ago Egypt's Minister of Foreign Trade, Rachid Mohammed Rachid, was very optimistic that negotiations could start soon. The Egyptian government and Egyptian big business have been pushing for this for nearly a decade now, always to be disappointed because of slow economic reform or other matters as minor countries like Bahrain and Oman (as a friend calls them, the "bitch states") speed ahead with their own FTAs. Now this is being linked to the Ayman Nour case.

The Washington Post, in its ongoing campaign against the Mubarak regime, published this editorial today:

THE BUSH administration has taken a first step toward adjusting its relationship with Egypt following President Hosni Mubarak's flagrant violation of his promises to lead a transition to democracy. An Egyptian delegation that was to visit Washington this month to discuss a free-trade agreement has been disinvited, and the agreement itself was put on hold. Thanks to Mr. Mubarak's autocratic backsliding -- including his crude persecution and imprisonment of his leading liberal opponent, Ayman Nour -- Egypt will continue to lag behind Jordan, Morocco and other modernizing Arab states that enjoy tariff-free access to U.S. markets. For Egypt's business community and the reformist technocrats in its cabinet, the message should be clear: Egypt won't join the global economic mainstream unless it abandons its corrupt dictatorship.

I wouldn't get to enthusiastic, this "first step" is most probably the last step... but we'll see.

Update: The State Dept. commented on the issue in its daily press briefing.

QUESTION: Thank you. Can you confirm The Washington Post editorial that there was a trade mission from Egypt deliberately dis-invited to send the Egyptian Government a message that they're not making enough progress towards democracy?

MR. MCCORMACK: Well, in terms of trade missions, the United States Trade Representative is the authority that would meet with foreign trade delegations and they would govern the --scheduling those visits, so I think that they're probably the most appropriate place in the government to ask those questions about timing, the particular timing of any delegation's visit.

I would say only that we have been working closely with the Egyptian Government on the issues of democratic and economic reform. We have been trying to encourage democratic and economic reforms. We have seen some progress in those areas. We have been working with them on -- in the area of trade. Just last year, we worked with the Egyptian Government and the Israeli Government to set up a QIZ. It's a trade zone that has been quite successful.

So we will continue to engage the Egyptian Government on issues of economic reform and of trade and, of course, on the political front, we will as well. So we are going to be addressing this whole series of issues across our relationship with Egypt that's a very broad and deep relationship that we have with them, and I would expect the discussions about democratic and economic reform, as well as our trade ties with the Egyptian Government, including a free trade agreement, will continue.

QUESTION: Can I follow up on --

QUESTION: While the USTR has been -- is obviously the point of call for the specific trade issue, this building has been the main point regarding pushing the democracy agenda with Egypt. So I wonder, is a part of the reporting true that the Bush Administration is dissatisfied with where they -- how far along they are on the democratic path and therefore taken a decision to send a signal that you're not doing it right, whether it was through dis-inviting them in a trade mission or some other way?

MR. MCCORMACK: Well, after the most recent round of elections, you know that we expressed our serious concern about Egypt's commitment to democratic reform. We think that democratic reforms, economic reforms go hand in hand, as we talked about a little bit earlier, concerning this hemisphere. We believe that these things are interlocked: democratic reforms, good governance, going hand in hand with the expansion of economic opportunities and the expansion of trade are very important to the freedom agenda that the President has outlined in his First Inaugural.

So we're going to be working with Egypt on that whole range of issues. We believe that economic reforms are important. We believe that democratic reform -- continuing democratic reforms are very important. We expressed some serious concerns about -- in the wake of the results of the last election, some of the things that we saw, about reforms on the democratic front. So we'll continue -- certainly continue our dialogue with the Egyptian Government on these issues and we'll keep you updated on how discussions with respect to our free trade agreement progress.

QUESTION: Well, can I follow up? At the same time, when the President and the Secretary talked in the beginning about the democracy agenda and that U.S. relationships are going to be governed with countries depending on their commitment to kind of democracy, rule of law, human rights and things like that, are we seeing a decision by the Administration to put that policy in effect? Is Egypt at the point now where its relationship is -- where the relationship with the U.S. is, at this point, being affected because of its lack of commitment to some of these reforms that you've (inaudible)?

MR. MCCORMACK: Well, when the President and the Secretary talked about -- and have talked about the freedom agenda, what they have -- and the President specifically mentioned Egypt in the Second Inaugural Address. He called upon the Egyptian Government to lead in the spread of democracy in the region, just as they led the way in negotiating a peace with Israel.

Also part of that Inaugural, and the Secretary has subsequently spoken about this as well, is the idea that in order to have the best possible relationship that you can with the United States, to have the broadest, deepest relationship with the United States, that's going to depend on this intersection of interests. Of course, we're going to continue to have a good, broad and deep relationship with Egypt. The trajectory of that relationship, of course, will depend upon the continuing intersection of interests between the United States and Egypt.

I expect that the trajectory is going to remain on a good course. Are there issues? Sure, and we've talked to the Egyptian Government about that. In order to -- so it gets back to the basic principle. In order to realize the best possible relationship with the United States, then we would expect that the Egyptian Government would continue along the pathway to democratic and economic reform. We have seen steps towards that goal. They have made promises in that regard. President Mubarak has talked about, during his presidential campaign, changes that he promised to make and we would hope that President Mubarak follows through on the promises that he made in his election campaign. So we'll see how these events unfold.

Again, we have an excellent relationship with Egypt. We have a number of mutual interests. We have a great interest in the advance of the democratic and economic reform efforts in Egypt, and those discussions and that focus will certainly continue in the months and years ahead.

QUESTION: Right. But to go on what you just said, is it right now with Egypt the broadest and deepest it could be based on its actions in terms of this trajectory of commitment to democratic reform?

MR. MCCORMACK: Well, again, I think that there are always issues that we can work on. We talked about our serious concerns regarding the recent election. While Egypt has made great strides on the front of opening up the political process in Egypt to other parties, there is still a long way to go and we're going to work with them on that. Ultimately, these are decisions that are going to have to be made by the Egyptian Government and the Egyptian people; we can't dictate this -- dictate changes to them. They themselves are going to have to make those decisions. We can encourage change, but ultimately they are the ones that are going to have to make these decisions.

How can a man talk so much and say so little?