Wednesday, January 18, 2006

Egypt could miss US trade deal

By Jonathan Wright
Wed Jan 18, 2006

CAIRO (Reuters) - Egypt could lose its chance of a trade deal with Washington if it cannot convince the Bush administration to launch talks within the next few weeks, a congressional staffer told Egyptian businessmen on Wednesday.

The Bush administration has not yet decided to start talks with Egypt and both it and some of the members of congress who would vote on any agreement have linked expanded trade with Egypt with political reform by President Hosni Mubarak.

A particular concern is the imprisonment of liberal opposition leader Ayman Nour, who is serving a five-year sentence on forgery charges he says are politically motivated.

The senior congressional staffer, who asked not to be named, told a breakfast organised by the American Chamber of Commerce Egypt would not get another chance at a deal for four years.

"If they don't launch the FTA (Free Trade Agreement) within three weeks to a month, you will lose the opportunity until 2010. That's the grim reality ... and the FTA negotiations have been taken off course by events not directly related," he said.

Another congressional staffer told the meeting U.S. lawmakers would also take Egyptian reform into account.

"It's important for you to recognise that for a number of members of Congress progress on political reform will be very important in deciding how they will vote on the FTA," he said.

The Egyptian government says it has made changes, notably by amending the constitution last year to allow multi-candidate elections for the presidency. But monitors said presidential and parliamentary elections last year were seriously flawed.

Mubarak beat Ayman Nour, his most prominent opponent, by 89 percent of the vote to 8 percent, and his National Democratic Party retained its two-thirds majority in parliament.

Businessmen and congressional staffers at the breakfast said the Egyptian government should also act fast on the Nour case.

Told it could take months for Nour's appeal to come up in court, one businessman said: "That's just not quick enough."

The Washington Post said in an editorial on Tuesday the United States had cancelled an invitation to an Egyptian delegation to discuss the trade agreement this month because of "President Hosni Mubarak's flagrant violation of his promises to lead a transition to democracy".

U.S. State Department spokesman Sean McCormack told reporters on Tuesday that Egypt has made some progress on both economic and democratic reforms, but needed to do more.

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