CAIRO, 3 April 2005 — Egyptian President Hosni Mubarak will meet today with Saudi Foreign Minister Prince Saud Al-Faisal for talks on bilateral relations and the Middle East peace process. Prince Saud will also head the Saudi side of the 12th ministerial meeting of the Supreme Joint Egyptian-Saudi Committee, while the Egyptian side will be headed by Egyptian Foreign Minister Ahmad Abul-Ghait.
The committee meetings will discuss boosting economic cooperation and methods of attracting Saudi investments to Egypt and the possibility of establishing a free trade zone by next year.
Cairo’s foreign policy has traditionally centered on forging closer economic ties with the country’s two largest trading partners, the US and the EU. Often overlooked, however, has been the extensive relationship that Egypt enjoys with its strong trading partner, Saudi Arabia.
According to the latest figures by the Foreign Trade Ministry, the volume of trade between Saudi Arabia and Egypt between January and August 2004 was $418 million of which Saudi Arabian exports to Egypt accounts for $277 million.
Saudi Arabia currently heads the list of Arab countries that have large investments in Egypt and the two countries are regarded as the two Arab states with the “largest bilateral trade, estimated at about SR1.5 billion ($600 million). Joint investment projects involving the two countries number 112 costing SR9.22 billion or $2.45 billion”
In fact, Cairo was also the main destination of Saudi tourists last summer.
Historically, the relationship has been confined to the exchange of labor and capital. Saudi Arabia has the largest expatriate Egyptian population in the Arab world. The “Saudization” plan, however, has affected the contracts of Egyptian workers that dropped 30 percent in 2004.
The two countries are trying to move away from their reliance on this old traditional market by promoting a more balanced trade and investment relationship.
Some problems, however, persist to remain in face of this ambition plan. In last week’s meeting of the Saudi-Egyptian Business Committee, Saudi businessmen expressed their worries about Egypt’s delay to move to cancel the incentives given to some Arab countries, which affects the Saudi exports.
Egyptian exporters called for lifting the ban on the accumulation of Egyptian onion at Jeddah airport and increase Egyptian potato exports to the Kingdom. They also demanded an end to the ban on Egyptian livestock exports, frozen meat, slaughtered chickens and eggs.
Gamal Al-Nazer, chairman of the Egyptian Businessmen Association and member of the Saudi-Egyptian Business Committee said the two countries will agree on a plan to set up a factory for medicines in the Kingdom and to carry out a project for fertilizers in Egypt with Egyptian-Saudi investments up to $700 million. “We will also announce new tax incentives and custom reduction on Saudi exports entering the country,” Al-Nazer told Arab News.
Today’s meetings are expected to focus on signing memorandums of undertsanding in the fields of tourism, education, culture and housing. It will also witness the announcement of the establishment of a sea bridge to facilitate and pave the way for free passage of goods and people between the two countries within he framework of the Arab Free Trade Accord.
