On June 1 with the implementation of a cooperation agreement between Egypt and the European Union, Egypt embarked on an important economic and political experiment. The agreement is an honest expression of the importance of economic ties. During this time of turbulence in the Middle East, the EU parliaments ratified the Egyptian-European agreement with unprecedented speed. In less than a year, 15 different parliaments have approved an agreement that normally takes three to five years. The EU has confirmed that the agreement with Egypt is central to creating a strategic partnership between Europe and the countries south of the Mediterranean; it goes beyond free trade to include a wider economic consolidation of southern Mediterranean countries within the economies of Europe and the world.
For Egypt, the agreement has many advantages. On the commercial level, it is an opportunity to increase the flow of bilateral trade since Europe is Egypt’s foremost commercial partner. The movement of manufactured goods from the EU to areas of cheap production will attract foreign investment from countries such as Japan, South Korea and China who will be drawn by the lure of commercial advantages such as tax exemption for products exported to the EU if those products originated in Egypt.
The extent of the developments in ties between Europe and Egypt have been questioned in recent times owing to the proposal for a greater Middle East — a project with unclear and uncertain features though it appears to aim at bringing stability to the region and fighting terrorism.
Several days ago a number of political analysts began to fear the results and effects of putting forward this greater Middle East plan at the G-8 Summit, to be held in the US in a few days. The fear is that Europeans may change their minds, whether as a result of political pressure or in submission to economic temptations that may eclipse what the southern Mediterranean countries and Egypt can provide.
The logic of profit and loss, however, dictates that EU countries will remain committed to their agreement because whatever the temptations, they will never reach the level of gain to be made from the markets of the southern Mediterranean countries. This eternal struggle between international economic blocs will in the end be won by those who develop their ties with other countries.
The extremely sensitive and dangerous situation in the Middle East makes it imperative that the situation be managed calmly and with diplomacy rather than with violence, threats of force or attempting to impose ideas and principles that conflict with the nations in the region. Additionally, economic integration between rich and poor is the shortest and most important road to ending violence in all its forms.
The Egyptian-European partnership has now begun in earnest. Its continuation, however, hinges on European leaders participating in the G-8 Summit and, later, the decisions of the NATO leaders. Their decisions will assuredly crystallize the European-American relationship in the coming period. These relationships are part of the economic war begun in the final decade of the last century.
