Egypt will light the way, says US (Photo: Reuters)
New US support for the Egyptian economy aims to make the country a beacon of success in a financially stagnant region, a US Treasury official has told Ahram Online.
"We look to Egypt to chart a new course that can be an inspiration for everybody, not just in the Middle East but several countries across the world that may be going through their own transitions," said Navtej Dhillon, senior advisor to the US Treasury Department.
Answering questions during a webstreamed press conference, Dhillon said that Egypt's revolution was part of wider quest for political freedoms and economic opportunities across the Arab world and that Egypt's large population and long history give it major influence in the new regional order.
His comments followed US President Barack Obama's speech on the Middle East and North Africa on Thursday evening, which promised $1 billion of debt relief to Egypt, $1bn of enterprise funds and greater market integration between Egypt, its neighbours, Europe and the US.
Dhillon said the cancellation of $1 billion of Egypt's approximate $3.6bn debt with the US was a "historic initiative", unmatched since a similar waiver was granted to Poland in the early 1990s. Speaking to Ahram Online, he denied there was any contradiction between the debt relief mentioned in the President's address and a debt swap detailed in a State Department release.
"I think what the President has outlined and what the State Department has outlined is consistent," Dhillon said. "The idea here is that the United State will cancel $1billion dollars of debt... and what that does is free up the resources for Egypt. We would be working with the Egyptian government and civil society to redirect those payments towards projects that have a development focus."
Dhillon was quick to stress the ways in which the $1bn are reinvested in Egypt would not be dictated by the US.
"There is wide recognition that our investments will be aligned with the interests and the aspirations of the people," he said. "Sectors [of investment] will be decided in close consultations with the Egyptians."
The US government has also held discussions with local economists and civil society groups since the January 25 revolution, he added. "We know that some fundamental economic grievances played a very important rule of the revolution - lack of opportunities, a clearer rule of law that allows entrepreneurs to succeed. Infrastructure is important too."
But Dhillon wouldn't be drawn on what impact a change in Egypt's political direction could have on US economic aid. Would the policy change if Egypt elected a government less friendly to US interests?
"I think that it's probably too early to speculate," Dhillon said. "We certainly look forward to the outcome of the election and obviously stand ready to support the government and the people."
While refusing to condemn the growing appetite in Egypt for the nationalisation of key companies, Dhillon suggested the US favoured a different solution.
"Egypt really has to chart its own path, there's no straitjacket here," he said. "I think it's... clear that an economy that's more open has a thriving private sector, one where corruption is combated, citizens have a voice and better access to services. I think these will be the core pillars of a successful Egyptian economy and we stand ready to support that path."
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