Israeli-Egyptian Relations, 1980-2000 by Ephraim Dowek

Author:Ephraim Dowek [Dowek, Ephraim]
Language: eng
Format: epub
Tags: International Relations, Social Science, Political Science, Regional Studies, General
ISBN: 9781135279370
Google: 220ECwAAQBAJ
Goodreads: 27288584
Publisher: Routledge
Published: 2001-06-01T00:00:00+00:00

13 • Commerce and Economy

Negotiations on the establishment of trade, economic and financial relations between the two countries were also initiated before the opening of the embassies. Israel attached great importance to these fields — more out of political than economic considerations. It was clear that, for objective: reasons, Egypt would never become a major commercial partner for Israel. Israeli experts in foreign trade estimated, that within three to five years, the volume of trade with Egypt (not including oil) would reach annually around $150-200 million, representing less than one per cent of Israel's global trade (today, less than 0.5 per cent). They believed that, with time, there might arise additional opportunities for joint ventures with the Egyptian public and private sectors. They also hoped that Egypt would become a transit point for indirect trade with Arab and Muslim countries which did not maintain diplomatic relations with Israel and implemented the Arab commercial boy cot i.

The geographic nearness and the short distance by good roads between the two countries gave Israel a relative advantage over overseas competitors — maritime freight costs as well as the substantial expenses involved in repeated handling of goods and land transportation to and from the ports could be spared. Altogether, only 520 kilometers separate Jerusalem from Cairo (of which 400 are on Egyptian soil). From the main Israeli industrial centers the distance was much shorter and did not significantly exceed the distance from Alexandria to Cairo (270 kilometers). In the early days, the road was narrow and heavily congested (in the late 1980s, a super-highway was built) and, furthermore, Alexandria harbor was overcrowded and the long waiting time made the costs of maritime freight even heavier. But all this proved to be irrelevant in the light of the Egyptian policies aimed at reducing trade with Israel to the bare minimum, even if it was economically advantageous for Egypt.

With the opening of the embassies, Israel strove to accelerate the economic negotiations and reach, as quickly as possible, mutually agreed solutions on all relevant issues. It raised the need for arrangements in the fields of: trade exchanges, goods transportation, customs facilities, anchoring rights, access to public sector tenders, banking and financial links, direct relations between the two central banks, encouragement of joint ventures and reciprocal investments, prevention of double taxation, and participation in trade and industrial fairs. First and foremost, it demanded the termination of Egypt's adherence to the Arab boycott and the abrogation of all related laws and regulations.

Egypt was in no hurry. It dragged its feet on every issue and made the convening of subcommittees (established under Israeli pressure) into a complex and time-consuming diplomatic operation. Discussions were acrimonious and went into the smallest details. Elementary matters, which would have been settled in a few hours with any other country, were turned by the Egyptians into cardinal issues necessitating endless discussions and which seldom found a satisfactory solution. Only a few weeks before the decisive date - the second phase of withdrawal from Sinai -

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