On 24 January, US Secretary of State Marco Rubio announced a freeze on US aid funding, with the exception of humanitarian food programmes and military aid to Israel and Egypt.
According to the US media, a memo on foreign aid was sent to American embassies around the world laying out how the State Department, the United States Agency for International Development (USAID) and other agencies are expected to execute US President Donald Trump’s executive order halting foreign aid for a 90-day period. Trump signed the executive order on 20 January, hours after taking office.
The United States is the world’s largest single donor, providing $72 billion of aid in fiscal year 2022-23.
The State Department is in charge of overseeing military aid to allies and partner nations. A line in the memo specifically exempted Israel and Egypt. Both receive military financing from the US government to purchase US weapons and other military equipment and pay for military training.
The $125-130 million of economic assistance that Egypt receives each year to fund development programmes, mainly focused on health, education, agriculture, climate and energy, will be halted under the State Department’s freeze order, pending a 90-day review.
Commentators in the US and Egypt mostly agree that Egypt’s exemption is linked to Cairo’s role in maintaining security in the Middle East, and to the peace treaty between Egypt and Israel.
Foreign Minister Badr Abdelatty and his US counterpart Marco Rubio had their first phone call on Friday, the same day the State Department imposed the aid freeze. According to US State Department spokesperson Tammy Bruce, Rubio thanked Abdelatty “for Egypt’s mediation efforts in securing the release of hostages, and for sustaining humanitarian assistance deliveries throughout Gaza.” Both Rubio and Abdelatty affirmed the importance of the US-Egypt strategic partnership for regional peace, security, and stability, and Rubio reiterated “the importance of close cooperation and coordination to advance post-conflict planning for the governance and security of Gaza”.
Tom Harb, a Republican Party member and director of the Washington-based American-Middle East Alliance for Democracy, told Asharq Al-Awsat newspaper that while the exemption decision is undoubtedly linked to the peace agreement between Egypt and Israel, “the security situation in the Middle East, the Gaza war and Houthi threats to navigation in the Red Sea” all played a role .
Following the 1979 signing of the Egyptian-Israeli peace agreement, US president Jimmy Carter announced that both Egypt and Israel would receive annual economic and military aid. In 1982, the aid began to be paid in the form of non-refundable grants of $3 billion to Israel, and $2.1 billion to Egypt, though the economic, rather than military component of the aid, has substantially fallen.
American aid accounts for 57 per cent of the total amount Egypt receives and equates to less than two per cent of Egypt’s GDP.
Washington-based American affairs expert Mohamed Al-Sattouhi agrees that “the decision concerning Egypt is linked to the peace treaty with Israel and the sensitivity of the situation should aid be given to Israel and not Egypt.”
“The decision is also linked to Washington’s assessment of Egypt’s position, especially with regard to events in Gaza and the fear of any confusion in the ceasefire agreement and the arrangements associated with it.”
A third factor, in Al-Sattouhi’s view, is that “Republicans, in general, have positive positions towards Egypt while under Democratic administrations the relationship tends to face tensions given the way Democrats link aid to the human rights situation in Egypt.”
In September 2024, for the first time under Democratic president Joe Biden, Washington approved Egypt’s military aid in full. The US State Department said at the time it was “in the interest of US national security”.
On 7 January, Reuters reported that the Biden administration, without any official explanation, had transferred $95 million of military aid allocated to Egypt to Lebanon. It remains unclear whether this sum is included in the Trump exemption.
Egyptian military strategist Samir Ragheb believes Egypt’s role in combating terrorism, the close military cooperation between the Egyptian and American armies and the passage of American warships through the Suez Canal all influenced the exemption decision.
As for US economic assistance, professor of political science Tarek Fahmy notes that it has been decreasing steadily, from $850 million in the early 1990s to just $130 million last year.
“It is not a problem that US economic assistance to Egypt will face a freeze given how little money is involved,” says Fahmy.
Al-Ahram political analyst Gamal Abdel-Gawad believes US President Donald Trump is using a “stick and carrot” approach to achieve US interests. In a recent TV interview, he said Trump’s statements that he would like to see Egypt and Jordan increase the number of Palestinian refugees they accept from the Gaza Strip had raised suspicions that he might use US aid to pressure them into doing so.
Should that happen, Abdel-Gawad warns “it will make the future of US aid to Egypt uncertain, and dependent of how far Trump sees Egypt as serving America’s interests.”
* A version of this article appears in print in the 30 January, 2025 edition of Al-Ahram Weekly
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