Daily News Egypt closely examines the political and economic relations with the US in the feature below in light of the latest updates through economic and political analysis, as well as from data obtained from governmental entities as well.
DNE exclusively received detailed data document from the General Authority for Investment (GAFI) showing that the financial sector is the most attractive area for US firms in terms of investments value with about $1.2bn, while industrial sector ranked number two with $882.62m of total American investments in Egypt worth $2.587bn.
The document added that services sector is the main economic sector that attract American firms, in terms of American companies numbers to recordh 509 firms, while the industrial sector came in second rank with 292, and total number of American firms in Egypt is 1,290.
The document mentioned that the industrial sector is the biggest sector that offers Egyptians job opportunities with 29,296 of total job opportunities valued at 48,620, offered by American firms operating in Egypt.
American firms operating in the construction sector offers Egyptians 72,48 job opportunities, said the document noting that American firms working on it offers about 43,14 jobs for Egyptians, according to the document.
There is a emajor potential to boost business cooperation with US
Moreover, Yomn El-Hamaki, economic expert told Daily News Egypt that there is a major potential to boost business cooperation with the US, adding that Egypt is recommended to benefit more from the QIZ agreement with the US, as it has not made full use of the agreement. A limited number of Egyptian firms and economic sectors benefit from the QIZ, however, there are more opportunities as well to use in the agreement, said El-Hamaki.
El-Hamaki added that the US enjoys a huge consumption market, many countries including China benefited from cooperating with it, adding, “the recent economic war resulted from the huge trade cooperation between China and the US.”
Egypt’s exportation to the US is modest and does not represent both countries great values, said El-Hamaki, adding, “I think that boosting Egyptian exports to the US is connected with increasing small and medium enterprises’ share in the QIZ agreement, which needs high level of governmental efforts to convince the decision makers to include SME’s in to the QIZ. I think this suggestion will be the ideal motivation for boosting QIZ exports.”
Notably, that Jim Boughner, minister counsellor of the US embassy, told Daily News Egypt in March that the two-way trade between the US and Egypt reached $5.6bn in 2017, which is a 13% increase over 2016, noting that textiles and petroleum sectors are the largest sources of Egyptian exports to the United States.
“Bilateral Free Trade Agreement discussions faced many obstacles, political directives prevail the scene in the past years. These challenges might not exist right now. There were many dialogues, but unfortunately both sides didn’t conclude the agreement,” said El-Hamaki.
El-Hamaki suggested that the Egyptian government should draw a new map for boosting the business relations with the US depending on sharing the US technologies offered by US firms.
“The new suggested map should take in to account Trump’s policy of America First, and make sure that the map includes incentives for the American side,” he added.
AmCham Egypt’s 40th Doorknock Mission went to Washington DC with 35 delegates, representing a wide range of industries, said Tarek Tawfik, president of AmCham Egypt in April, adding, “it was a marathon of more than 95 intense meetings in just five days, reaching most decision centres, think tanks, and media. I commend our Doorknock delegation, composed of a majority of young, professional Egyptian men and women, all representing the best of Egypt. The chamber clearly has a bright future with such a high calibre of young leaders.”
Meanwhile, Rakha Ahmed, former assistant of foreign affairs minister said that the American bilateral political relations witnessed many ups and downs over the last years, adding, “relations were always good, tense or very tense from 2009 till recent days.”
The US government welcomed the 25 January Revolution, where relations remained at a constant level, said Ahmed, noting that the US leadership also welcomed the Muslim Brotherhood’s rule, but after the 30 June uprising the American government showed its opposition and the political relations were tense.
“During Barack Obama’s mandate, president Abdel Fattah Al-Sisi was not invited to officially visit the US, but the situation was changed after Donald Trump became president of the US, he invited the Egyptian president for the first official visit in April 2017,” said Ahmed.
Al-Sisi is the first Egyptian leader to visit the White House since Egypt’s 2011 revolution, as well as the 2013 popularly backed military coup that brought him to power. Unlike Obama, who refrained from inviting Al- Sisi to Washington, Trump has had a warm relationship since meeting Al-Sisi on the side-lines of the UN General Assembly in September 2016, according to media reports in April 2017.
Trump congratulated his Egyptian counterpart, Abdel Fattah Al-Sisi, on his re-election in a phone call and reaffirmed the US’s strategic partnership with Egypt, the White House said on 2 April.
Egyptian Russian recent economic close cooperation may be the reason of slowing down American relations
Former assistant of foreign affairs minister commented that the warm signs between the American and Egyptian leaders did not translate into concrete outputs.
In August 2017, Egypt has criticized the United States’ decision to suspend $152m in military aid and its plans to cut $96m in other aids because of what Washington said regarding human rights concerns, according to a previous press statement by the Egyptian Ministry of Foreign Affairs.
Former assistant of foreign affairs minister said that there are many controversial issues between both countries, including the situation of the Palestinian issue and Syrian crisis.
On 21 December a total of 128 countries defied President Donald Trump’s threat and voted in favour of a United Nations General Assembly resolution calling for the United States to drop its recognition of Jerusalem as Israel’s capital.
Israel considers Jerusalem its eternal capital, while Palestinians want the capital of an independent state of theirs to be in the city’s eastern sector, which Israel captured in the 1967 Middle East war and annexed in a move never recognized internationally.
Ahmed added that Egyptian Russian recent economic close cooperation may be the reason of slowing down American relations, clarifying that Egypt collaborates with Russia in many businesses.
Moscow and Cairo signed an agreement in 2015 for Russia to build a nuclear power plant in Egypt, with Russia extending a loan to Egypt to cover the costs of construction.
Egypt’s official gazette said in 2016 that the loan was worth $25bn and would finance 85% of the value of each work’s contract, services, and equipment shipping. Egypt would fund the remaining 15%.
Egypt said on 1 July that the construction of its first nuclear power plant, to be built by Russia, will begin in the next two to two-and-a-half years. The 4,800 MW)capacity plant at Dabaa in the north part of the country, aims to be up and running by 2026, a spokesperson from the Ministry of Electricity and Renewable Energy told Reuters.