CAIRO: A free trade zone will be established on the Egypt-Libya border for industrial, trade and tourist projects, reported the local press.
Procedures for setting up the zone will be discussed during a visit to Egypt by a Libyan delegation next month, said Minister of Investment Mahmoud Mohieldin, who is currently visiting Tripoli.
While in Cairo, the Libyan delegation will discuss means to facilitate trade between the two countries, Mohieldin said following a meeting with Secretary of the General People s Committee for Finance Mohamed Ali Huwaj.
Libyan investments in Egypt jumped 32 percent from 2004 to 2008, Mohieldin said.
Press reports also indicated that an Egyptian-Libyan business council will be established to promote mutual investments and settle any disputes between the business leaders in the two countries.
The establishment of the council will be officially announced in September, said Hussein Sabour, the head of the Egyptian Businessmen Association.
Earlier this month, Egyptian President Hosni Mubarak and Libya President Muammar Qaddafi met in Cairo and laid the groundwork to increase Libyan investments in Egypt to $10 billion. During the meetings, Egyptian businesses were encouraged to eye investment opportunities in the neighboring countries.
After these meetings, Libyan authorities announced a cooperative plan with Egypt to build an oil refinery and a natural gas pipeline on Egypt’s north coast – a move that signals the increasingly close relations between the two countries.
The refinery, paid for in full by the Libyans, will be built west of Alexandria and will be used to process Libyan crude oil. Libyan authorities anticipate the refinery will have the capacity to process 250,000 barrels per day.
The natural gas pipeline will stretch from Alexandria in the east to Tobruk, Libya in the west, though authorities did not discuss whether Egypt would be importing or exporting the gas.
Trade volume, according to the Ministry of Trade and Industry, increased 39 percent between fiscal year 2005-2006 and fiscal year 2006-2007 from $191 million to $267 million.
Though Egypt enjoys a trade surplus with Libya, the trade gap has continued to narrow in recent years. This is due primarily to a rise in imports from Libya, which increased 75 percent between 2006 and 2007.