Bloomberg News

Egyptian Envoy Says Israel Treaty Secure, Defends NGO Raids

January 09, 2012

Jan. 6 (Bloomberg) -- Egypt’s ambassador to the U.S. pushed back against calls in Washington to withhold more than $1 billion in U.S. aid following raids on democracy groups in Cairo and dismissed concerns that his nation may abandon its peace treaty with Israel.

“The Egyptian public recognizes the importance” of the accord with Israel and the stability it promotes, Ambassador Sameh Shoukry said in an interview yesterday at the Bloomberg Washington bureau. “Egypt has no motivation to abrogate the treaty.”

Shoukry downplayed comments attributed Jan. 1 to the deputy chief of the Muslim Brotherhood movement, whose Justice and Freedom Party is leading Egypt’s parliamentary elections. Rashad al-Bayoumi was quoted by Al-Hayat newspaper as saying the peace treaty might be put to a future referendum.

The 1978 treaty might not survive a referendum, according to a poll released in April by Pew Global Attitudes Project. It found that 54 percent of Egyptians favor annulling the peace treaty and 36 percent want to maintain it.

While “there is always a possibility by the agreement of both parties to re-discuss certain areas” of the Camp David Accords if mutually beneficial, Shoukry said, there is “really no pending threat to the peace treaty.”

On other matters, he said that promised international assistance has been slow to materialize and that Egyptian authorities are taking steps to prevent a recurrence of the recent violence against protesters who continue to challenge the interim military leadership.

NGO Raids

Shoukry, a career diplomat who stayed in his post following the ouster of President Hosni Mubarak, said there has been an overreaction in Washington to the Dec. 29 raids at offices of Egyptian and foreign civil society groups. The searches and seizures, he said, were ordered by independent judges investigating alleged violations of Egypt’s laws on funding and registration for non-governmental organizations.

The Obama administration has condemned the raids on NGOs, which included three U.S.-based pro-democracy groups. Defense Secretary Leon Panetta called his counterpart last week to express “deep concern,” and State Department spokeswoman Victoria Nuland yesterday said “the issue has not yet been resolved.”

The Working Group on Egypt, an influential bipartisan group that advises the administration, and Representative Frank Wolf, a Virginia Republican and senior member of the House Appropriations committee, have called for the suspension of U.S. aid to Egypt over the raids.

‘Not Helpful’

“It’s not helpful to the relationship when the issue of assistance is presented as a form of punishment,” Shoukry said. “We were hopeful that the U.S. would recognize the legal nature” of the searches and “wait for the results of that investigation and not jump to any preconceived ideas.”

Shoukry said that there are 35,000 NGOs operating in Egypt, and that the government supports their “valuable role.” There “might be a need to revisit” some of the laws that “were put on the books in previous times, but until” changes are made, the laws apply, he said.

Nuland, speaking to reporters in Washington, said Assistant Secretary of State Jeffrey Feltman, who was visiting Cairo yesterday, told Egyptian authorities that the U.S.-based democracy groups “have been willing to register” in compliance with the law, and that “it’s the Egyptian government that hasn’t made a decision whether it wants to register them.”

“What these NGOs have been doing is helping provide some of the basic tools” for a democracy, such as voter education and media training, Feltman told reporters in Cairo.

U.S. Commitment

Egypt, at $1.56 billion, is the fifth-largest recipient of U.S. foreign assistance in the Obama administration’s request for fiscal year 2012. The White House sought $3 billion for Israel, the second-largest aid recipient.

Shoukry said that aid to both Egypt and Israel is “a commitment by the United States” under the Camp David peace accords and the U.S. has derived at least as much benefit from the aid as has Egypt. U.S. aid has facilitated close ties with the Egyptian military, enabling the U.S. to maintain security in the region and access facilities and logistical support during the Iraq War, he said.

“If we wanted to calculate it,” the benefits to the U.S. “would far, far exceed the actual sum of assistance received” by Egypt, he said.

Aid Lags

Egyptian Prime Minister Kamal el-Ganzouri, in Cairo Jan. 4, in lamented that Western countries and Arab states had not made good on promises of stepped-up aid following the uprising that ousted Mubarak nearly a year ago.

Last May, Obama announced the U.S. would arrange $1 billion in debt relief and $1 billion in loan guarantees for Egypt. The European Union pledged to boost its aid by $1.75 billion at a meeting of the Group of Eight industrial countries in Deauville, France.

“The monies have not been provided,” Shoukry said, “not only as far as the U.S. was concerned, but as far as the G-8 Deauville initiative. There have been no cash injections into the Egyptian economy to support the transition and to address the difficulties and the challenges that we have faced because of our declining tourist revenues and the lack of productivity related to the turbulence of the revolution.”

Loan Guarantees

Unrest in Egypt slowed economic growth in the fiscal year that ended in June to 1.8 percent from 5.1 percent the previous year, and drained 50 percent of the nation’s foreign reserves in 2011.

Shoukry said Egypt understands the delays in U.S. aid stem in part from the lack of a legislative framework. The loan guarantees are “a very complicated issue,” he said. Egyptian “financial institutions are still seeking clarifications from the U.S. on the costs related to the loan guarantees. I know that some of them are not eager to engage, because they feel those costs might not be rewarding to them from an economic perspective.”

As for U.S. and domestic criticism of the Egyptian authorities’ violent handling of recent protests, there has been an official recognition that mistakes were made, Shoukry said.

“There’s been apologies issued by the government and the military council, and there has been an ongoing judicial investigation to define responsibility for the loss of life and for the circumstances surrounding some of these demonstrations,” he said.

Egypt held its third round of parliamentary elections this week, and a presidential vote is scheduled to take place by the end of June.

--Editor: Terry Atlas

To contact the reporter on this story: Indira A.R. Lakshmanan in Washington at ilakshmanan@bloomberg.net

To contact the editor responsible for this story: John Walcott at jwalcott9@bloomberg.net


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