Directorate-General for Trade

Egypt

Egypt is a major trading partner for the EU in the Southern Mediterranean region. It is part of the Euromed process for creating a free trade area of the Mediterranean.

The EU and Egypt have made significant progress in freeing up trade between them. Since the signing of the new EU-Egypt Association Agreement in 2004, half of the EU industrial exports to Egypt has already been liberalised and special preferential treatment for agriculture have significantly boosted agricultural trade. Ongoing negotiations are aimed at furthering this agricultural liberalisation and improving conditions for services trade and for companies seeking to establish businesses in both markets.

Trade between the EU and Egypt has risen substantially after the entry of the EU-Egypt Association Agreement in 2004

Trade in goods

• EU goods exports to Egypt 2007: €10.3 billion
• EU goods imports from Egypt 2007: €7 billion

In 2007, EU imports from Egypt were dominated by energy (43.4%) and textiles and clothes (10.1%). EU exports to Egypt consist mainly of machinery (26.2%) and chemicals (15.4%).

Trade in services

In 2006 Egypt exported to the EU-27 mainly travel (57%) and transportation (31%,) services. It services imports from the EU were dominated by business services (57%).

Foreign Direct Investment

Egypt experienced an FDI surge in 2005 as a result of privatisation and economic reforms. Overall FDI inflows have neared €2 billion since the start of the reforms. EU direct investment in Egypt amounted for €1 billion out of the total stock of €5.3 billion.

More statistics on Egypt

The European Neighbourhood Policy

EU-Egypt co-operation is an important part of the new European Neighbourhood Policy. The Neighbourhood policy supports political and economic cooperation between Egypt and the EU and is the framework for financial assistance from the EU to Egypt. The European Neighbourhood Policy Instrument - ENPI - will be endowed with €11.9 billion for 2007-2013. Egypt will receive a share of this. Funds are used to support Egypt's reforms in the areas of democracy, human rights and justice, develop the competitiveness and productivity of the Egyptian Economy and ensure the sustainability of the Egyptian development through support for reform and education, public health and investment in the transport, energy and environment sectors.

South-South integration

On 25 February 2004, Egypt signed the Agadir Agreement with Jordan, Morocco and Tunisia. This committed all parties to removing substantially all tariffs on trade between them and to harmonising their legislation with regard to standards and customs procedures. It entered into force in July 2006. The effective implementation started in April 2007 with the creation of the Agadir Technical Unit in Amman. Egypt has also a free trade agreement in force with Turkey since March 2007 and, more recently, with EFTA countries. These agreements cover the application of the new Pan-Euro-Mediterranean system of cumulation of origin, which Egypt also adopted bilaterally with the EU.