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9-Misc: U.S. punishes Egypt because it did not "deliver"



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                                  PART I
-------------------------------- GENET-news --------------------------------

TITLE:  US retaliation against Egypt hits trade plans
SOURCE: The Financial Times, UK, by Edward Alden
        http://news.ft.com/servlet/ContentServer?pagename=FT.com/StoryFT/
        FullStory&c=StoryFT&cid=1054966520080
DATE:   Jun 29, 2003

------------------ archive: http://www.gene.ch/genet.html ------------------


US retaliation against Egypt hits trade plans

The US has suspended plans to advance free trade talks with Egypt in
response to the Arab country's decision not to join the US in a World
Trade Organisation complaint against Europe's ban on genetically modified
foods.

The harsh US retaliation against one of its closest Arab allies has taken
Egypt by surprise and set back the initial stages of President George W.
Bush's plans for a region-wide free trade area by 2013. US beats Egypt
with trade stick Click here

Robert Zoellick, the US trade representative, delivered the tough message
to Egyptian trade officials last week after Egypt confirmed that it would
not be a co-complainant in the WTO case.

Egypt says it is stunned by the fury of the US response over what it says
are small differences over GM foods.

The US announced last month that Egypt - along with Argentina and Canada
- would join the US in a WTO complaint aimed at forcing the European
Union to approve the sale of new GM varieties, which have been blocked
since 1998.

Egypt's participation was crucial to the US claim that the European ban
is hurting developing countries as well as US biotechnology companies.

But Egypt, faced with a domestic backlash, pulled out of the case and has
decided to pursue its complaint against the EU separately.

"If you're going to do a free trade agreement with someone, it's
important that the people you're talking to are going to be able to
deliver," said a US trade official. "They told us one thing and did another."


                                  PART II
-------------------------------- GENET-news --------------------------------

TITLE:  US beats Egypt with trade stick
SOURCE: The Financial Times, UK, by Edward Alden
        http://news.ft.com/servlet/ContentServer?pagename=FT.com/StoryFT/
        FullStory&c=StoryFT&cid=1054966519796&p=1012571727179
DATE:   Jun 29, 2003

------------------ archive: http://www.gene.ch/genet.html ------------------


US beats Egypt with trade stick

The US has suspended plans to advance free trade talks with Egypt, in
response to the Arab country's decision not to join the US in a World
Trade Organisation complaint against Europe's ban on genetically modified
foods.

When President George W. Bush announced plans last month for a Middle
East free trade area by 2013, Robert Zoellick (pictured), his trade
representative, said Egypt would be the linchpin.

"Egypt has for centuries been the heart of the Arab world," he said,
adding that he would like to launch talks on a bilateral free-trade
agreement by early next year.

But last week, Mr Zoellick delivered a very different message, accusing
Egypt of backsliding on economic reform and saying that a free-trade
agreement "isn't going to be handed to them just because Egypt is a big
and important country".

The reason for those harsh words was buried in a digression on the
difficulty of getting trade deals through Congress. "I believe in open
markets," he said, "but we all have political challenges and so when I'm
working with a colleague I need to know their word is good."

Mr Zoellick, administration officials say, is furious over the decision
by Egypt - which grows drought-resistant GM crops for export - to pull
back its support from the WTO case.

The US announced last month that Egypt, along with Argentina and Canada,
would join it in a complaint aimed at forcing the European Union to
approve the sale of new GM varieties, which have been blocked since 1998.

But an Egyptian official said the decision was strongly opposed by many
members of parliament and businesses with close ties to Europe.

"The way it was announced was like a war with the EU, and we cannot go to
war with the EU," he said. "It is 40 per cent of our trade."

The harsh US retaliation against one of its closest Arab allies has taken
Egypt by surprise and has set back the initial stages of President Bush's
plans for a region-wide free trade area by 2013.

However, a US trade official said: "When you're given a direct commitment
by a government and they do an about-face, that has to have an effect in
terms of who you do a free-trade agreement with."

It is the most pointed example yet of a growing US willingness to use
trade to reward its friends and punish its opponents - an equation Egypt,
the largest Arab recipient of US foreign aid, did not expect to end up on
the wrong side of.

But for the US, Egypt's participation in the WTO case was critical to
support its claim that the EU ban is hurting poor countries. While the
case is backed by some other developing countries, only Argentina among
them produces GM crops.




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GENET
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