VZCZCXYZ0002
PP RUEHWEB

DE RUEHEG #2507 3510719
ZNR UUUUU ZZH
P 160719Z DEC 08
FM AMEMBASSY CAIRO
TO RUEHC/SECSTATE WASHDC PRIORITY 1059
INFO RUEHTV/AMEMBASSY TEL AVIV PRIORITY 1813
RHEHAAA/WHITE HOUSE WASHDC PRIORITY
RUEATRS/DEPT OF TREASURY WASHDC PRIORITY
RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY

UNCLAS CAIRO 002507 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR NEA/ELA AND NEA/IPA 
TEL AVIV FOR APRIL COHEN 
TREASURY FOR BRYAN BALIN AND FRANCISCO PARODI 
WHITE HOUSE FOR USTR/SONIA FRANCESKI 
 
E.O. 12958: N/A 
TAGS: ECON ETRD EFIN EINV PGOV PREL IS EG
SUBJECT: MOVING FORWARD ON QIZ EXPANSION 
 
REF: A) 07 CAIRO 3022 B) 08 CAIRO 2410 
 
¶1. (U) This is an action request.  Please see paragraph six. 
 
¶2. (SBU) On December 14, econcouns met with Ali Awni, chief 
of the Qualifying Industrial Zone (QIZ) Unit of the Ministry 
of Trade and Industry (MTI).  Awni stated that he hoped 
further consideration of the proposed QIZ expansion to Upper 
Egypt (ref a) could still take place this year.  Awni told us 
that the Egyptian QIZ Unit and their Israeli counterparts 
were preparing a joint letter (ref b) to USTR proposing a 
revision to the expansion request originally submitted in 
October 2007.  This proposal would ask for a more limited 
expansion of the QIZ to only Beni Suef and Minya 
governorates.  He informed us that the Commercial Counselor 
at the Egyptian Embassy in Washington had recently discussed 
this idea with USTR in Washington.  In connection with this 
new, more limited expansion request, Awni promised to provide 
us with the names of companies in Beni Suef and Minya with 
the potential to export under the QIZ program.  He hopes to 
have this information to the Embassy by December 16.  He 
reiterated that many of these companies were very small with 
only a handful of employees. 
 
¶3. (SBU) In addition to the QIZ request, Awni expressed 
concern that the USG has not yet responded to a separate 
Egyptian proposal to establish a memorandum of understanding 
(MOU) with the U.S. Customs and Border Patrol (USCBP) 
division of DHS.  This proposal, unrelated to the request for 
QIZ expansion, was made directly by the Egyptians to DHS this 
past spring.  The purpose of the agreement is to help the 
Egyptians gain greater expertise in compliance with and 
enforcement of existing QIZ terms and documentation. 
 
¶4. (SBU) In a subsequent conversation on December 15, MTI 
Senior Advisor Sayed Elbous told econoff that he hopes to 
have a signed, joint Egypt/Israel letter with the formal 
request for a more limited QIZ expansion ready by December 
¶16.  It was not clear to us if he will deliver that to us 
here in Cairo or through the Egyptian Embassy in Washington. 
 
¶5. (U) Post will forward the list of potential QIZ exporters 
upon receipt.  We also stand ready to assist visitors from 
USTR who would be interested in a site visit to the proposed 
QIZ expansion areas. Both Beni Suef and Minya can be visited 
in a day-trip from Cairo. 
 
¶6. (SBU) ACTION REQUESTED:  Post would appreciate a status 
update, as soon as it is available, on the GOE's outstanding 
request for an MOU between the GOE and U.S. Customs. 
SCOBEY