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CAPITOL REPORT
WOLF BLITZER
The Complexities Of Taba As An Issue
U S. officials believe
there are some serious
differences of opinion
within Egypt fight now on
whether or not to complete an
agreement with Israel setting
the terms of reference for arbi-
trating their longstanding Taba
border dispute.
As seen by these American ex-
perts, there are basically two
schools of thought in President
Hosni Mubarak's government
on Taba as well as on the entire
matter of relations with Israel.
One group believes that
Egypt should delay any final
Taba arbitration agreement un-
til the political picture in Israel
becomes absolutely clear. Will
the political rotation in Jeru-
salem in October, for example,
take place? If it becomes ap-
parent that Yitzhak Shamir will
indeed replace Shimon Peres as
Prime Minister, this school
argues, Egypt would be wise to
avoid any agreement with Israel
on Taba.
These officials maintain that
the Taba arbitration "corn-
promise" would, after all, be on-
. ly part of a basket of issues aim-
ed at improving relations bet-
ween Cairo and Jerusalem.
There is a whole host of accom-
.panying bilateral agreements in-
volving such issues as trade and
tourism that are being discuss-
ed — in addition to Taba.
Even though setting the
terms of reference for resolving
Taba would still require atleast
a year or two of actual arbitra-
tion, Egypt would be bound im-
mediately to return its am-
bassador to Tel Aviv — a sym-
bolically dramatic development.
Egypt also would be required to
limit the anti-Israel propaganda
in its officially-controlled news
media. The short-term upshot
would be an improved Israeli-
Egyptian relationship.
But this first group of Egyp-
tian officials is very reluctant to
enter into any wide-ranging im-
provement of relations with an
Israel headed by Shamir and his
Likud party. They fear that with
Shamir in the Prime Minister's
Office, Israel would quickly step
up its settlement activity on the
West Bank and Gaza. There
would also be a reduced readi-
ness within Israel to improve
the "quality of life" for Pales-
tinians living there. And as a
■
result of such controversial
measures, Egypt would auto-
matically become further embar-
rassed and isolated in the Arab
world. Domestically, Mubarak's
regime would also suffer.
Therefore, this first school
argues that Egypt should drag
on the Taba talks until the
political scene within Israel
becomes clear.
The second school of thought,
on the other hand, is less con-
cerned about the scheduled rota-
tion in Israel. These officials are
more seriously worried about
the overall impact that a deter-
iorating Egyptian relationship
76 , Friday, July 4, 1986
THE DETROIT JEWISH NEWS
with Israel has on Egypt's ties
with the United States.
These officials, considered
more "practical," are very wor-
ried about Egypt's extremely
serious economic woes. They
recognize that their only long-
term hope is to win more
economic assistance from the
United States — as quickly as
possible. Shoring up relations
with Israel would, of course,
strengthen Egypt's posture in
Washington, especially in Con-
gress which ultimately must ap-
propriate all foreign aid.
U.S. analysts believe that
Egypt's economic problems
pose a considerably greater
danger to Mubarak's regime
than the steady rise of Islamic
fundamentalism and other polit-
ical headaches. Egypt's isola-
tion in the Arab world, for ex-
ample, is not nearly as complete
today as it was only two or three
years ago. Jordan has restored
normal diplomatic ties with
Tiny Taba has major
domestic and foreign
implications for
Egypt.
Egypt. Relations with Iraq and
other "moderate" Arab coun-
tries are also good even though
Egypt has not yet been admit-
ted back into the Arab League.
The economic problems facing
Egypt, however, are the poten-
tial killer. The situation is bad
and getting worse. The bottom
is just about ready to fall out.
This was pointed out the other
day by The Wall Street Journal
which noted that Egyptian De-
fense Minister Abdel Halim
Abu Ghazala had come to
Washington earlier in June "as
a messenger of doom."
According to the report, Abu
Ghazala told Defense Secretary
Caspar Weinberger that if the
U.S. didn't help Egypt with its
economic problems quickly, U.S.
strategic and political interests
in the regime would be under-
mined. "Economic unrest could
provoke political unheaval,"
Abu Ghazala reportedly said.
Weinberger and Secretary of
State George Shultz promised
to help, but that will not be easy.
The U.S., the Journal report
noted, "would have to show new
creativity, defy Treasury De-
partment conservatism and
bend usual practices to help
Egypt out of its economic bind.
Washington's budget squeeze
rules out conventional increases
in aid, and bilateral debt relief or
forgiveness isn't a precedent the
Administration wants to set.
The Treasury and some in Con-
gress argue that the U.S. should
force Egypt to straighten out its
inefficient economy before gran-
ting relief."
But Egypt's economy may al-
ready be beyond repair. What is
needed is a complete overhaul of
the country's basic infrastruc-
ture — and that is financially
impossible unless something
like Peres's Marshall Plan pro-
posal actually gets off the
ground. Egypt needs a massive
infusion of money. But the Mar-
shall Plan, which Peres initially
raised largely in response to
Egypt's very pressing needs,
does not look like it's going
anywhere.
A recent report by Republican
Senator Charles McC. Mathias
of Maryland, a member of the
Senate Foreign Relations Com-
mittee, underlined some of the
builtin problems facing Egypt.
Although Mathias said that
Mubarak's regime is probably
not "immediately threatened,"
the economic picture is very
bad. "These problems are large-
ly not of Egypt's making," he
wrote. "Egypt is the victim of
events beyond its control.
Regional terrorism has discour-
aged tourist visits. Oil revenues
have plummeted with the col-
lapse of international- oil prices.
Remittances from workers liv-
ing aboard have begun falling
with the economic downturn in
the Persian Gulf."
Mathias continued, "Egypt
faces other problems which are
domestic in origin. Population
pressures are intense. It is
estimated that Egypt adds a
million people to its population
every eight to ten months. The
economy remains hopelessly in-
efficient. The government does
not feel sufficiently confident
politically to take hard decisions
on issues of subsidies and ex-
change rates. Egypt is forced to
import about 50 percent of its
food needs, where once it was
self-sufficient. The government
has refused thus far to go to the
IMF ( International Monetary
Fund), and has rejected
rescheduling its debt, which is a
crushing burden."
Mathias proposed that Egypt
be forced to turn to the IMF for
economic relief, rather than to
Washington. "In the long
term," he said, "it is probably
unwise for one sovereign nation
to be in the position of preaching
to another sovereign nation with
respect to its domestic economic
policy. Our mutual interests
would be better served by
Egypt obtaining and following
advice from international bodies
such as the IMF."
The problem with that route,
however, is that the IMF would
more forcefully link economic
relief to the imposition of tough,
politically-unpopular economic
. reforms and austerity measures.
Mubarak probably doesn't feel
strong enough to handle that
scenario.
Thus, the likelihood is that
Egypt will continue to resist the
IMF option, looking instead to
the Reagan Administration and
the U.S. Congress for
assistance. And that should
strengthen those in Egypt urg-
ing a more pragmatic approach
in relations with Israel.