Egypt is a key U.S. ally in the Middle East, and the relationship between the two nations has been rebooted since the arrival of President Donald Trump to the White House. As they both step up their efforts in counter-terrorism, U.S. investors are looking to Egypt’s economic resurgence and see the nation as a key investment destination in the region.
Egypt and the U.S. have enjoyed a strategic relationship for almost four decades. And as a key ally in the Middle East, Egypt has received nearly $80 billion in military and economic assistance from the U.S. over the past 30 years. But the launch of the Egypt-U.S. Strategic Dialogue in 2015 and President Abdelfatah El-Sisi’s first visit to Washington, DC in 2017 represent the opening of a new chapter in this vital partnership, which will be underpinned by stronger ties in politics and diplomacy, security and defense, and trade and investment.
In May, 2017, President El-Sisi became the first Egyptian head of state in eight years to make an official visit to Washington, DC. At a meeting at the White House, President Donald Trump, who is keen to reboot ties with Egypt following a period of strained relations during the Obama administration, praised President El-Sisi’s efforts to revive the Egyptian economy and fighting terrorism in the Middle East. The two leaders called for closer cooperation on a range of issues, particularly on combating militant extremism and greater focus on economic and commercial cooperation for the mutual benefit of both nations.
Egypt has always been a favored destination in the region for U.S. business, and major American companies are heavily invested in Egypt and have been here over the last 40 or 50 years. U.S. foreign direct investment (FDI) in Egypt stood at $22.2 billion as of 2016, representing 38.6 percent of U.S. FDI in Africa. In 2016, Egypt was the largest recipient of U.S. FDI in Africa, and second in the Middle East after the United Arab Emirates.
In FY 2016/17 U.S. FDI into Egypt doubled to $1.8 billion, a clear sign of growing U.S. investor confidence in the recovering Egyptian economy. Moving forward, investment opportunities for U.S. business are set to increase, thanks to projects such as the Suez Canal expansion and economic zone, New Capital City and Vision 2030 plan to build a diversified economy, dependent on innovation and knowledge.
With the multibillion-dollar Suez Canal Zone project – which will see major investments in ports and other infrastructure to support industry and logistics – U.S. companies will have the ideal base to expand manufacturing and to take advantage of the free trade arrangements that Egypt has with both the Arab world and Africa.
As a vital partner for the U.S. in counter-terrorism, Egypt’s relationship with the U.S. is also firmly grounded in security and defense. At a meeting between the two leaders during the UN General Assembly in September – which focused on the fight against terrorism, as well as economic cooperation and ways to boost American companies’ investments in Egypt – Donald Trump again reiterated that President El-Sisi was doing an “outstanding job” in the fight against terrorism, of which, he said, Egypt was “at the forefront”.
“We have very special things happening, our relationship has never been stronger, we are working with Egypt on many different fronts including military and trade,” stated President Trump.
A few weeks before the UN General Assembly, U.S. Secretary of State Mike Pompeo authorized the release of $1.2 billion in military assistance to Egypt to boost its defense and security capabilities in the region – something which is vital to both regional and U.S. national security.
Together, the two nations are dealing with the challenges of conflicts in Syria, Iran, Yemen and Libya, and the stability that Egypt itself has achieved over the past four years since the Arab Spring uprisings can serve as an example and contribute to stability in the rest of region.
In the September meeting with Donald Trump, President El-Sisi emphasized “Egypt’s commitment to enhancing the outstanding partnership…between the two countries,” and reiterated “the significant role of this partnership in promoting peace and stability in the Middle East.”
“Egypt looks forward to more coordination and consultations with the U.S. on various regional issues, primarily combating terrorism, which is the greatest threat to the stability of the region and the world.”