Egypt and Israel sign deal easing access to U.S. market

Reuters, 09.10.07. Egypt and Israel signed an agreement on Tuesday making it easier for Egyptian-based companies to win exemption from duties and quotas when exporting goods to the United States. Egyptian and Israeli ministers agreed to cut to 10.5 percent from 11.7 percent the minimum proportion of Israeli components in goods which are eligible for the exemptions, Egyptian Trade and Industry Minister Rachid Mohamed Rachid told a news conference.

They also agreed to ask U.S. Trade Representative Susan Schwab to extend the special market access arrangements to companies based in eight provinces south of Cairo, he added. Unlike the reduction in the Israeli input, the geographical extension of the arrangements to new areas requires negotiations with the U.S. side, he added. Egypt enjoys the exemptions under a Qualified Industrial Zones (QIZ) agreement signed with Israel and the United States in 2004. The aim was to promote economic cooperation between Israel and Egypt and help Israeli companies export. Since the agreement came into effect in February 2005, 203 Egyptian-based companies have exported to the United States eligible goods worth $1.28 billion, the Egyptian Ministry of Trade and Industry said. Rachid, who signed the agreement with visiting Industry and Trade Minister Eli Yishai, said the reduction was a good first step. "It will not be the last reduction," he added.