Partnership with Europe ushers in economic liberalization
Egypt-European Union, Economics, 9/23/2000
"Egypt cannot stand isolated from the world in view of the weight and status it enjoys on the regional and international levels," said Minister of Supply Hassan Khedr on behalf of Premier Atef Ebeid.
"The Egyptian-European partnership is a kind of challenge to carry out the aspired development that would finally lead to more economic liberalization and to upgrading the competitiveness as well as the living patterns of the Egyptians," said the Prime Minister.
At the forum, organized by the Federation of Chambers of Commerce for tackling the qualifying programme for Egyptian-European partnership, Ebeid said that the European Union's member-states constituted a giant economic bloc from which Egypt could draw several privileges.
"These privileges can be optimized if an accelerated comprehensive program to modernize the Egyptian society with its layers and activities is drawn up," said Ebeid.
"The partnership agreement is not confined only to trade, but rather envelopes many other activities, including services, social, security and political cooperation," noted Ebeid.
"The trade agreement with the EU marks a full package of frames to magnify economic, trade, cultural and political relations," said Ebeid.
"Under the agreement, Egyptian exports to Europe would be relieved of all customs tariffs; and with regard to Egyptian textile exports quota limits would be dropped," Ebeid said, adding that in return Egypt would drop taxes on European industrial imports over a transitional period of 16 years, divided into four interwoven stages.
In the first three-year stage raw materials and capital goods will be exempted. In the second four-year stage, starting from the fourth year of the program, food products will be spared tax. In the third seven-year stage, to start as of the sixth year of the program, manufactured commodities will be exempted. And the fourth 11-year stage will start as of the sixth year of the programme.
The agreement has set the necessary mechanisms to combat aberrant trade activities such as dumping and tackle trade balance deficits.
Gamal Bayoumi, the Assistant Foreign Minister and Coordinator General of the Euro-Egyptian partnership agreement, said the accord will help realize an important target of Egypt's economic reform programme.
Bayoumi explained, during discussions at the forum that it would help liberalize trade, open up fresh markets to Egyptian exports, attract more investments and increase employment rates through a series of policies and agreements to be integrated during the coming decade.
Bayoumi said Egypt has several relations with European countries via the 1977 trade cooperation agreement, adding that the European Union the largest market for Egyptian exports, accommodating some 46 per cent of Egypt's total exports. He also cited some $1 billion in European non-refundable grants, between 1997 and 1999, to beef up the Egyptian economy competitiveness.
The agreement, Bayoumi went on to say, further gives Egypt a 16-year transitional period to liberalize industrial imports from the EU. According to the Egyptian official, the final draft agreement has been submitted to the ministerial committee which decided on September 1 to refer it to the cabinet for endorsement.
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