VZCZCXYZ0019
RR RUEHWEB

DE RUEHEG #3367 3331556
ZNR UUUUU ZZH
R 291556Z NOV 07
FM AMEMBASSY CAIRO
TO RUEHC/SECSTATE WASHDC 7587
INFO RUEATRS/DEPT OF TREASURY WASHDC
RUCPDOC/USDOC WASHDC 0360

UNCLAS CAIRO 003367 
 
SIPDIS 
 
SIPDIS 
SENSITIVE 
 
STATE FOR NEA/ELA, NEA/RA, AND EEB/IFD/OIA 
USAID FOR ANE/MEA MCCLOUD AND RILEY 
TREASURY FOR MATHIASON AND HIRSON 
COMMERCE FOR 4520/ITA/ANESA/OBERG 
 
E.O. 12958:  N/A 
TAGS: PGOV ECON EAID EINV EG
SUBJECT:  EGYPT: NEXT STEPS ON A BILATERAL INVESTMENT TREATY 
 
Sensitive but Unclassified.  Please protect accordingly. 
 
¶1.  (SBU) Visiting EEB PDAS Elizabeth Dibble met with Minister of 
Investment Mohieldin to discuss next steps on updating the 
U.S.-Egypt Bilateral Investment Treaty (BIT).  Mohieldin was 
positive about the U.S. white paper and said his staff would have a 
reply soon.  He does not foresee problems with any articles of the 
model BIT, but considers the agreement very "technical," requiring 
considerable effort and resources from the Egyptian side to 
negotiate and implement.  Mohieldin now believes updating the BIT 
will take at least 24 months, and will only be ready to introduce to 
the People's Assembly at its November 2009 session. 
 
¶2.  (SBU) Mohieldin said he still hopes to open discussion on a 
U.S.-Egypt FTA, and asked if BIT negotiations should be delayed in 
anticipation of FTA negotiations in the next few years.  He was 
concerned that formally announcing BIT negotiations would signal 
that the FTA was "dead," and was being replaced by a BIT.  That is a 
message Mohieldin did not want to send to the government or the 
business community.  Furthermore, he thought the BIT should be 
negotiated in the context of an FTA, where there may be 
"trade-offs."  Dibble noted that the focus now is on getting the 
four completed FTAs through Congress.  Without Trade Promotion 
Authority, it would be very difficult to envision opening talks on 
new FTAs.  A BIT, on the other hand, should be relatively easy to 
pass through Congress.  Opening BIT negotiations would not signal 
that the FTA is dead, but rather that the U.S. and Egypt are moving 
from a donor-recipient relationship to an economic partnership. 
 
¶3.  (SBU) Mohieldin agreed that his staff could meet with U.S. 
representatives on the margins of the OECD Investment Committee 
meeting in Paris December 12-13 for exploratory talks on updating 
the BIT.  Zaid Bahie el Din, former head of the General Authority 
for Investment and Free Zones, will lead the Egyptian delegation to 
the OECD Investment Conference in Paris December 12-13, and will be 
accompanied by Egypt's main BIT technical negotiators, Maha 
Serageldin and Mohamed Abdel Gawad.  Mohieldin noted that the 
ministries of Investment and Justice would need technical 
cooperation and capacity building in order to implement some 
obligations of the model BIT, including enforcement of property 
rights.  Dibble agreed that this would be discussed in the context 
of the talks. 
RICCIARDONE