Egypt, EU agreement comes into force
An association accord between Egypt and the European Union comes into force Tuesday, setting off the progressive liberalization of trade, services and capital along with the future establishment of a free-trade area.
The European Union is Egypt’s top commercial partner. In addition, the EU is Egypt’s leading investor.
Trade between the EU and Egypt has risen by more than 5% in the last five years to reach around 10 billion euro in 2003. The EU accounts for 40% of Egyptian exports and 34% of its imports, with the balance of trade still in the EU's favour.
Egypt’s main exports to the EU in 2003 were energy (38%), textiles and clothing (15%), agricultural products (9%), and chemicals. Major imports from the EU were power generating machinery (21%), chemicals (18%), transport equipment (11%), and food and agricultural products (10%). Egypt has a serious but improving trade deficit that has put considerable pressure on the Egyptian Pound.
The EU-Egypt Association Agreement was signed in Luxembourg on June 25 2001. Following its ratification by the Parliaments of the 15 EU Member States, the European Parliament, and the Egyptian Parliament, it came into force Tuesday. It replaces the 1977 Cooperation Agreement. A Protocol adapting the Agreement to the enlarged EU was initialled on May 11 2004 with the Egyptian authorities. It will be signed once internal procedures are concluded.
It is part of a much wider project - the Euro-Mediterranean partnership - between the EU and 12 nations around the Mediterranean whose aim is to establish a free-trade area around the year 2010.
The EU has directed a total of 250 million euros for an industrial modernization project in Egypt to prepare the country, especially its small and medium size businesses, for the opening up of markets, dismantling of customs tariffs, and increased competition. (menareport.com)
© 2004 Mena Report (www.menareport.com)