Egypt consolidates grip on northern Sinai

According to a The Jerusalem Post report, the Egyptian military has secured large areas of the strategic stretch of land bordering Palestinian-run Gaza and Israel on one side and the Suez Canal on the other. 

It is no longer on the back foot, witnesses, security sources and analysts say. Civilian life is still severely curtailed but the long-neglected region is changing as the state forges ahead with development schemes.

Many of the militants have been killed, fled or surrendered. Around 200 are still active, down from 400 two years ago and 800 in 2017, according to three Egyptian security sources.

On the outskirts of North Sinai's main city Al Arish, near where razed olive farms once stood, the government has built new apartment blocks.

A resident said people just sought a return to normality.

"We've had enough," said the man in his 50s, declining to be named. "We want to return to our houses or even the new ones they are building. We want to live in peace again."

Unrest roiled northern Sinai following the uprising in Egypt against Hosni Mubarak in 2011, escalating after the army overthrew President Mohamed Mursi.

In November 2017, the Islamic State-affiliated militant group Sinai Province claimed the most lethal attack in Egypt's modern history, which killed more than 300 people at a North Sinai mosque, as well as an assassination attempt against the defense and interior ministers at Al Arish military airport.

The military started an operation in response in February 2018 and now appears to be in its strongest position in North Sinai - the only area in Egypt where there is regular militant activity - for at least a decade.

The security presence in southern Sinai, a popular tourist destination, has also been reinforced and some international travel warnings scaled back.

At Sinai's northeastern point at Rafah and along the border with Gaza, a buffer zone has been created on cleared land, monitored by dozens of Egyptian watchtowers.

In its most recent statement on North Sinai, the Egyptian military said 89 suspected militants had been killed in an undefined period over recent months, against eight casualties from its own ranks.

There has been a "continuous and significant decline" in the number of attacks over the past three to four years, with approximately 17 recorded shooting attacks and 39 bomb attacks so far this year compared to 166 and 187 respectively in 2017, security analyst Oded Berkowitz said.

Sinai Province's capability has also been eroded by the squeezing of supply lines and recruitment from Gaza due in part to deteriorating relations with Palestinian factions there, and the hostility from Sinai residents, Berkowitz said.

Though, estimating militant numbers is hard, recent death notices suggest those still active are mostly Egyptian and Palestinians from Gaza, while previously they included foreign fighters from the Caucuses and Saudi Arabia, he said.

Near Bir al-Abd, where militants occupied a group of villages for weeks in the summer of 2020, masked gunmen stormed a café where Salem al-Sayed was watching football in September, kidnapping him and seven others and accusing them of cooperating with the military.

"They put us in a closed place so we could not hear anything, not even the sound of the wind," the 35-year-old told Reuters. After four days with their hands bound and blindfolded, they were freed by the military in a raid, Sayed said.

President Abdel Fattah al-Sisi, who as Army Chief ousted Mursi in 2013, says developing Sinai is a priority.

"We will not leave any land that can be developed in Sinai until we make it grow," he said this month at an event to mark the 1973 war with Israel on the peninsula.

Last month in northwestern Sinai, Sisi inaugurated a US$1.3 billion agricultural wastewater plant to help reclaim land for farming.

The government recently announced a plan for 17 agricultural and residential development clusters across Sinai, 10 of them in the north. It says it is allocating modern and traditional homes for those displaced.

Access and international cooperation development remain limited, however. Demolitions and other restrictions linked to military operations have triggered complaints from some residents and rights groups.

State infrastructure projects and housing developments seem beyond local needs and means, said Ahmed Salem of the London-based Sinai Foundation for Human Rights.

The effective siege in north-eastern Sinai has restricted much economic activity, he said.

"They (both sides) destroyed Al Arish, which used to be one of the most beautiful tourist places in Egypt. Nowhere else you could see such sandy beaches," said one middle-aged resident.

"We don't support Islamic State, but many Sinai residents, from Rafah to Al Arish, were dealt with unjustly and paid a heavy price after doing nothing wrong," he said.

Is European energy crisis self inflicted?

Europe is facing the brunt of an unprecedented energy crunch. Some call it a crisis and term it comparable to the Arab oil embargo of the 1970s, while others classify it self-inflicted. Brent crude is being traded at a 5 year high of US$84 per barrel, while spot natural gas prices are up more than 500% YoY. 

This is forcing gas to coal switching and putting the brakes on the EU’s green energy transition. Resurgent energy demand post-Covid, extreme weather conditions, supply chain disruptions and poor regional and global stockpiling have all contributed to Europe’s current crisis. Russia’s supremo Vladimir Putin may have a reason to pop a champagne bottle in view of the EU’s sanctions on the Kremlin. He says that Europe had created a self-inflicted wound.

Samer Moses, Manager of Global LNG Analytics at S&P Global says, “Europe finds itself between a rock and a hard place. With global liquefied natural gas (LNG) markets tight for nearly a year, and Russia facing its own upstream and infrastructure issues, Europe's two key sources of flexible gas supply have not shown up. Given just how depleted the region's storage situation is, any tremble of bullish news, be it weather or supply outage, has the power to send markets in search of ever higher price anchors, with fundamentals dictating the market will need to balance on demand destruction, a dynamic already being seen in industry across both Asia and Europe.”

This illustrates the concerns of many energy experts about Europe’s hasty transition away from traditional base-load power sources (gas, coal, and nuclear) to intermittent renewable generation. Europe’s master plan for carbon neutrality has pushed the member states away from long-term purchase agreements and towards short-term pricing, making the crisis even more costly to energy utilities and other consumers who are now seeking alternative fuel sources. Gas exporters like Russia and Qatar are ready to cash in.

The Qatari Energy Minister, Saad Al-Kaabi stated, “we have huge demand from all our customers and unfortunately, we can’t cater for everyone.” Qatar prefers East Asian customers who pay a premium. The EU is no longer the top market. This trend is consistent with exporters around the globe. Coupled with a decrease in domestic production, such as the depletion of the giant Groningen gas field in the Netherlands, the EU is left to bid higher and higher for imports. This coincides with overall uptick in demand for LNG across the globe in an effort to use it as a bridging fuel away from hydrocarbons.

At the same time, China, too, is in the throes of an energy crisis aggravated by unprecedented flooding across the country, post-Covid supply chain disruptions, and resurgent demand. To compensate for the lack of domestic coal production China has doubled their LNG imports over the last year (another reason Europe finds itself with lower than normal supplies).  More than 20 provinces have enacted rationing to deal with the worsening situation. “Get energy supplies at any price”, ordered the ruling Politburo, highlighting the giant economy’s dependence on imported coal and gas.

Russia – though appears not to be an outright market manipulator – is well positioned to benefit from the unfolding market conditions as Europe seeks out any and all gas supplies at outrageous prices. Indeed, the gas shortage is being used by the Kremlin to tout the necessity of Nord Stream 2, an ambitious (and highly controversial) geostrategic gambit by the Kremlin to pump 55 bcm of gas directly into Germany via undersea pipe. The project may be framed by certain German manufacturers and Russian policymakers as a boon for Europe’s energy security, but the reality is the pipeline will only make the EU more dependent on – and vulnerable too – the whims of Russia’s state-owned Gazprom.

European leaders were quick to claim that Russia is now weaponizing the gas markets to gain approval of the Nord Stream 2. Currently, Gazprom sends piped natural gas through Ukraine. A new pipeline would circumvent the embattled country. By law, Russian energy producers must satisfy domestic demand prior to exporting, meaning that a missing volume of exports could be attributed to domestic stockpile shortages.

IEA Executive Director Fatih Birol has claimed that “Russia could do more to increase gas availability to Europe and ensure storage is filled to adequate levels in preparation for the coming winter heating season.” Birol went on to say a further 15% could be supplied by Russia immediately.

A staunch pro-Russia actor, former chancellor of Germany Gerhard Schröder published an article claiming that the Russian government is incapable of manipulating the markets: "Anyone who conducts a serious study states: the reasons for the rise in prices should be sought in the international market - increased demand, global trends in the world market, and weather."

As the EU sought to decarbonize their energy infrastructure, Brussels failed to establish a reliable baseline capacity for electricity generation. Today, without the ample nuclear, coal, and gas power stations, Europe would be a dark and cold place indeed. Moreover, they lack sources of energy for low renewable periods like the “windless summer” of this past year in the UK. Low wind speeds and cloud cover are becoming more unpredictable as climate change progresses, and the lack of base-load generation has resulted in the current crisis.

Some of the reactions were to purchase alternative fuels such as coal, a fuel source that produces double the carbon emissions of natural gas. This defeats the purpose of energy transformation.

The United Kingdom, France and Spain have all issued new price ceilings. France has gone a step further and announced a one billion euro investment in nuclear power by the end of the decade.

Germany, despite all rationality, will decommissioned nearly all its reactors next year, while betting on wind and solar, and may soon be forced to bend knee to Russia, and therefore Lord Putin, by embracing Nord Stream 2, for their energy needs. Jack Sharples, a research fellow at the Oxford Institute of Energy Studies had this to say:

“The only way that we will know that for sure is if we see that Russia suddenly pull some spare gas out of their back pocket that we didn't know they had as soon as the Nord Stream 2 commercial operation is approved… Conversely, if/when Nord Stream 2 is approved and launched, we suddenly see gas transit via Ukraine drop to very low levels, that could be an indicator that Gazprom really don't have anything spare and that actually the purpose of Nord Stream 2 is to simply displace Ukraine.”

Depending on Russia to fill the energy supply gap is a risky proposition. But perhaps even more short-sighted is Europe’s unwillingness to partner with the United States beyond short-term contracts. Refusal to engage in long-term purchase agreements has led Europe to fall behind Asia as America’s top destination for LNG.

The energy crisis unfolding in Europe has many drivers, but EU green policy hubris and Russian hard-nosed energy poker are the key. The main lesson is: one cannot will energy transformation into reality without building ample, reliable and economically viable baseline generation capacity.

 

Afghanistan the largest source of opium

According to certain reports, Afghanistan is classified the source of more than 80% of the world’s opium supply, and in recent years, much of that has been in Taliban-controlled areas

When Taliban seized control of Afghanistan earlier this year, its leadership promised to end poppy cultivation across the country. To back up its pledge, Taliban leadership pointed to the prohibition on opium it imposed two decades ago when it was last in power.

Taliban will have a long way to go to make good on its commitment. In 2020, Afghan farmers devoted their third-highest-ever acreage to opium production, and the United Nations Office of Drugs and Crime reports that the opium trade has grown to constitute more than 10% of the country’s economy.

Much of that growth came from lands under Taliban control. In fact, in recent years, Taliban leaders have used the opium trade as a major revenue source, imposing an informal tax on farmers, laboratories that converted the crop into heroin, and smugglers who transported the drugs.

Some analysts, like the International Crisis Group’s Ibraheem Bahiss, believe that Taliban’s pledge on ending the opium trade in Afghanistan is merely a “bargaining chip in return for international aid.” According to the World Bank, prior to Taliban takeover such aid accounted for 43% of Afghanistan’s GDP.

The last time Taliban took control of Afghanistan, the poppy fields flourished. In 1999, three years after the group established its Islamic Emirate of Afghanistan, the country’s total production of raw opium was estimated to have hit nearly 4,600 tons — more than double the amount for the year before.

Almost a quarter century later, Afghanistan continues to be the world’s top opium producer. But since Taliban assumed power in Kabul earlier this month, spokesman Zabihullah Mujahid has repeatedly told international media Taliban would not allow the production of opium or other narcotics within its state.

“Afghanistan will not be a country of cultivation of opium anymore,” Mujahid said during a news conference on Aug. 17, two days after the group seized the Afghan capital.

That may not be an easy task. According to another report Afghanistan accounted for 85% of the opium produced worldwide last year, far outdoing rival producers such as Myanmar and Mexico. The country has also been accused of playing a major role in the global supply of cannabis and methamphetamines.

Despite its austere version of Islamic theology and strict enforcement of religious rules, the Taliban has long had a symbiotic relationship with the trade in opium, which can be processed chemically to produce narcotics such as heroin. In the 1990s, the group allowed the opium trade even as it banned hashish and cigarettes as haram (forbidden) for Muslims.

The group’s religious justification? Heroin largely affected non-Muslims outside of Afghanistan.

It was a “gymnastic” interpretation of Islamic law, said Haroun Rahimi, a legal scholar at the American University of Afghanistan. But the group needed the support of smugglers and farmers, as well as funding, which it could get by taxing opium production.

Taliban banned opium production in 2000 under Western pressure. However, after the 2001 US-led invasion of Afghanistan, production flourished again in Taliban-held areas. Despite US-backed eradication efforts estimated to cost US$9 billion, production peaked at an estimated 9,000 tons in 2017.

Today, Taliban face a new landscape. It is no longer the isolated, inward-looking government that ruled between 1996 and 2001, nor the mostly rural insurgency that fought against the US-backed Afghan government until its victory this month. It is now the de facto leader of a desperately poor nation recovering from decades of war, with significant levels of opioid addiction among its own citizens.

Robert Crews, an expert on Afghanistan at Stanford University, said Taliban proclamation on opium was probably a “diplomatic overture.” “It is aimed at demonstrating they will form a ‘responsible’ government, one that adheres to international legal norms,” Crews said.

The poppy can grow in warm and dry climates, requiring only a little irrigation. Resin from the plant can be refined into morphine, which can then be processed further into heroin; both are easily transportable, making opium an attractive crop in a country with weak infrastructure.

There is evidence of opium production in Afghanistan since at least the 18th century, scholars have said. But the industry only began to thrive after 1979, when the Soviet Union invaded, setting off a protracted period of conflict in the country that has lasted almost unbroken until the present.

Before the Taliban effectively seized power in 1996, around 59 percent of global opium production was estimated by the United Nations to be from the country. But production rose quickly under the Taliban’s auspices, drawing international criticism.

Taliban founder Mohammad Omar banned the cultivation and trade of opium in July 2000 and received a US$43 million grant in US counternarcotics funding. A UN report released the following year suggested the policy was showing signs of success.

But the US-led invasion of Afghanistan a year later upended that. As more and more rural areas of Afghanistan fell out of government control, poppy cultivation soared. By 2004, it had surpassed the peak of the first Taliban era and would soon go on to double it. Efforts to end the industry, backed by the United States, faltered.

In classified interviews published by The Washington Post as the Afghanistan Papers, officials admitted it wasn’t just Taliban enabling the trade.

“The biggest problem was corruption in Afghanistan, and drugs were part of it. You couldn’t deal with one without dealing with the other,” Douglas Wankel, a former Drug Enforcement Administration agent who led a federal counternarcotics task force in Kabul, told government interviewers.

 

It’s difficult to say to what extent the opium trade has contributed to the Taliban’s victory. Some experts argue that the funds produced by the trade, as well as Taliban control over it, are overstated. As the drugs have been largely exported abroad, the greatest profits have been made by criminal cartels outside of Afghanistan.

One study released earlier this year that estimated Taliban revenue in the opium-producing province of Nimruz found the group raised far more money there by taxing legal sectors such as transit goods and fuel than drugs — with US$40.9 million in taxes levied on the former and US$5.1 million on the latter in 2020.

In a sign of the shifting international drug market, the majority of revenue from the drug industry in the province was estimated to come from the production of methamphetamines, rather than opium, according to the Overseas Development Institute, the British think tank that produced the study.

David Mansfield, a British expert on Afghanistan’s informal economy and one of the authors of the report, said his research showed the limits of “control” in Afghanistan. “Everything is negotiated in Afghanistan because political and military power is diffuse, even with the Taliban,” he said.

Ibraheem Bahiss, an expert on Afghanistan with the International Crisis Group, said Taliban’s recent statements showed it was effectively “using narcotic eradication as a bargaining chip in return for international aid.”

While the group was estimated to have made US$39.9 million in revenue from taxes on the opium trade in 2018, the US government has previously supplied the Afghan government with around US$500 million in civilian aid each year.

Already blocked by the US treasury from accessing some Afghan government funds, Taliban is likely to need all the money it can get. So far, there has been no financial backing from the United States or other world powers. But cracking down on the opium trade would probably give the Taliban leverage with its neighbors such as Iran and Russia, the next stops on the drug route, or Europe and Canada, where it often ends up in its final form as heroin. (Most heroin in the United States comes from Mexico.)

For a group that has based much of its political legitimacy on the strict enforcement of religious law, it would also be more consistent. “Fundamentally, anything that harms the human body is haram [in Islamic law]. If something is prohibited, its consumption, dealing and trade are always prohibited,” Rahimi said.

Opioid addiction has taken a toll on Afghan society. One 2015 survey concluded that there were between 2.9 million and 3.6 million drug users in Afghanistan, with opioids being the drug of choice — an exceptionally high level of per capita drug usage.

Just as the Afghan government struggled with these problems, the Taliban may now too. “In many communities, opium cultivation is crucial to survival,” Crews said, adding that there could be confrontations with Afghan growers across the country who face economic problems because of drought and the coronavirus.

“They are harsh. They can use force,” Rahimi said, of the Taliban. “But there is a limit to how much force they can use. … It’d be like using force against their major base of support.”

Colin Powell embarks upon eternal journey

General Colin Powell, the first black American, former US Secretary of State and Chairman of the Joint Chiefs of Staff, passed away on Monday due to complications from Covid 19. He was fully vaccinated. 

"We want to thank the medical staff at Walter Reed National Medical Center for their caring treatment,” the Powell family said in a statement posted on Facebook. “We have lost a remarkable and loving husband, father, grandfather and a great American,” the family added.

Powell, born on April 5, 1937, in New York City, was raised by Jamaican immigrant parents in the South Bronx. The family said the former chairman of the Joint Chiefs of Staff had been fully vaccinated and was receiving treatment at Walter Reed National Medical Center. Powell reportedly had been diagnosed with multiple myeloma, a type of cancer. 

Following a decorated military career that included tours in Vietnam, Powell held key military and diplomatic positions throughout government, serving under both Democratic and Republican presidents. Powell endorsed then-candidate Joe Biden in the 2020 presidential election.

Former President George Bush, who tapped Powell to serve as his secretary of State, said he was “deeply saddened” by the military leader’s death.

“Laura and I are deeply saddened by the death of Colin Powell.

He was a great public servant, starting with his time as a soldier during Vietnam. Many Presidents relied on General Powell’s counsel and experience,” Bush said in a statement.

“He was National Security Adviser under President Reagan, Chairman of the Joint Chiefs of Staff under my father and President Clinton, and Secretary of State during my Administration. He was such a favorite of Presidents that he earned the Presidential Medal of Freedom — twice. He was highly respected at home and abroad. And most important, Colin was a family man and a friend. Laura and I send Alma and their children our sincere condolences as they remember the life of a great man,” he added.

Powell first joined the Reagan administration in 1987 as national security adviser, becoming the first Black individual to serve in the role. He later transitioned to chairman of the Joint Chiefs of Staff in 1989, a position he held for four years under former Presidents George Bush and Clinton. 

Calls for Powell to wage a presidential bid ramped up ahead of the 1996 election following the US-led coalition’s win in the Gulf War. He ultimately passed on a campaign of his own, concluding that he did not have a “passion” for elected politics.

The four-star general reentered the political sphere in 2001, when he was tapped by George Bush to serve as secretary of State, breaking another barrier and becoming the first Black American to serve in the role. He served in the post until 2005.

Powell led the US on the diplomatic front in the aftermath of the September 11, 2001, terrorist attacks, helping to secure support from other countries for the war on terror and invasion of Afghanistan. The secretary also faced criticism for his push for invading Iraq in 2003.

In a speech before the United Nations in February 2003, Powell showed what he said was evidence from US intelligence that illustrated that the Iraqi military was misleading United Nations inspectors and concealing weapons of mass destruction.

“There can be no doubt that Saddam Hussein has biological weapons and the capability to rapidly produce more, many more,” Powell said in his speech.

Inspectors, however, later said that weapons of mass destruction did not exist in Iraq.

In 2005, two years after Powell’s speech before the UN, a government report concluded that the intelligence community was “dead wrong” in its claim that Iraq was holding weapons of mass destruction prior to the United States' invasion.

Powell later said his speech before the UN was a “blot” on his record and recognized that it would be a part of his legacy, adding that he regretted delivering the remarks.

“I regret it now because the information was wrong — of course I do,” Powell told CNN’s Larry King in November 2010. “But I will always be seen as the one who made the case before the international community.” “I swayed public opinion, there's no question about it,” he added.

In his memoir “It Worked for Me,” published in 2012, Powell again discussed the speech, writing that “the event will earn a prominent paragraph in my obituary," according to CNN.

Powell studied at the City College of New York, where he participated in ROTC.

After graduating in 1958, Powell joined the US Army and was twice deployed to South Vietnam, where he was wounded twice.

Powell waded into the political arena during the Trump administration, announcing after the January 6 attack on the Capitol that he no longer considered himself a Republican.

Asked by CNN’s Fareed Zakaria if he believes “fellow Republicans” who have not criticized former President Trump “encouraged, at least, this wildness to grow and grow,” Powell said, “They did, and that’s why I can no longer call myself a Republican.”

“I’m not a fellow of anything right now. I’m just a citizen who has voted Republican, voted Democrat throughout my entire career, and right now I’m just watching my country and not concerned with parties,” he said.

 “I do not know how he was able to attract all of these people. They should have known better, but they were so taken by their political standing and how none of them wanted to put themselves at political risk. They would not stand up and tell the truth or stand up and criticize him or criticize others,” he added.

  

Iranian trade with neighbors up 52%YoY

The value of Iran’s non-oil trade with its 15 neighbors rose to US$22.588 billion in the first six months of the current Iranian calendar year, posting 52% increase year on year (YoY). This was stated by the spokesman of the Islamic Republic of Iran Customs Administration (IRICA).

The Islamic Republic traded over 47.222 million tons of commodities with the neighboring countries in the mentioned year, IRIB quoted Ruhollah Latifi.

The volume of the traded goods in the mentioned period also increased by 37% as compared to the figure for the previous year’s same period.

Iran traded a total of 79.104 million tons of non-oil products worth US$44.926 billion with its trade partners during this period.

Trade with neighboring countries in the first half of the year accounted for 60% and 50% of the country’s total non-oil trade during the said period, in terms of weight and value, respectively.

The country exported over 36.087 million tons of non-oil goods worth more than US$11.218 billion to the neighboring countries in the period under review, while imported more than 19.138 million tons of goods worth over US$11.369 billion.

Iraq was Iran’s top export destination, importing $3.840 billion worth of commodities from the Islamic Republic, while the lowest volume of exports was made to Saudi Arabia with only US$39,000, according to Latifi.

After Iraq, the main export destinations for Iranian products and goods were Turkey, the United Arab Emirates (UAE), Afghanistan and Pakistan.

On the other hand, the highest volume of Iran's imports from neighboring countries was made from the UAE with US$7.305 billion, followed by Turkey, Russia, Iraq and Oman.

Increasing non-oil exports to the neighboring countries is one of the major plans that the Iranian government has been pursuing in recent years.

Iran shares land or water borders with 15 countries namely UAE, Afghanistan, Armenia, Azerbaijan, Bahrain, Iraq, Kuwait, Kazakhstan, Oman, Pakistan, Qatar, Russia, Turkey, Turkmenistan, and Saudi Arabia.

According to IRICA, Iran currently exports non-oil commodities to 40 European countries, 21 Asian countries, 28 African countries, and 12 American countries, while importing from 41 European countries, 31 Asian countries, 12 American countries, and 11 countries in Africa.

Egypt an emerging global logistics hub

The government of Egypt has introduced a fully automated customs process aimed at significantly improving processing time and reducing costs for companies exporting goods to Egypt. 

The new trade facilitation technology—the Advance Cargo Information (ACI) system—was successfully implemented on October 1 across all of Egypt’s ports, and is being applied to all goods imported into the country.

By using digital methods underpinned by block chain technology, the new customs system dispenses with paper documents, enabling goods to be checked and cleared before they reach Egyptian ports. The technology also strengthens risk management systems, identifying goods before they are shipped.

At the time of its launch, 38,700 exporters from around the world were registered to the new system, which has been broadly welcomed by Egypt’s trade partners. “This new trade facilitation technology will make it simpler, easier and cheaper for all companies exporting goods to Egypt,” said Jan Noether, CEO of the German-Arab Chamber of Commerce (AHK Egypt). “It shows that Egypt is not only open for business, but serious about maximizing its location at the crossroads of the world to become one of the world’s great trading economies.”

Independent evaluation shows that Egypt’s customs processing times have already improved by 55%.

Egypt is Africa’s second-largest importer; responsible for total imports in 2019 valued at $76.4 billion, and it is the world’s largest importer of wheat and asphalt. The biggest exporting countries to Egypt are China, the United States, Saudi Arabia, Germany and Turkey.

At the launch of ACI, in Cairo, H.E. Dr. Mohamed Maait, Egypt’s Minister of Finance, described the implementation of ACI as “a crucial step in our plans to transform Egypt’s trade infrastructure. This new technology will make it much easier for companies all over the world to trade with Egypt, helping to deliver the government’s plan to create the most advanced logistics hub in the region.”

“The implementation of the Advance Cargo Information system is a crucial step in our plans to transform Egypt’s trade infrastructure. This new technology will make it much easier for companies all over the world to trade with Egypt, helping to deliver the government’s plan to create the most advanced logistics hub in the region.”

 In April 2019, the Egyptian government launched the National Single Window for Foreign Trade Facilitation (Nafeza), a single digital trade portal for all import, export and transit operations that links all of Egypt’s ports. The transformation program has also included the establishment of high-tech logistics centers in Cairo, East and West Port Said, Port Tawfik, Ain Sokhna, Damietta, Dakhilah and Alexandria to ensure that port facilities are transiting goods efficiently.

An evaluation shows that Egypt’s customs processing times have already improved by 55% since the portal was launched—a significant step in realizing the objective of reducing customs clearance time to less than one day.

Nafeza is part of an ambitious economic program to drive the wholesale modernization of the Egyptian economy. This initiative includes a $4 billion overhaul of Egypt’s ports, involving 58 wide-ranging projects that include the construction of new berths, trading yards and wharves as well as the dredging of shipping lanes and port docks. Plans are also in progress to develop a series of dry ports that will connect Egypt’s seaports to inland locations.

The dry port connections are part of a major railway and road expansion program—comprising more than 2,000 projects—set to be completed by 2024. Flagship projects include a highway linking Egypt with nine other African countries to boost Egypt’s exports to the continent, and a high-speed railway between Egyptian ports on the Red Sea and the Mediterranean coast. In line with Egypt Vision 2030, launched in February 2016, Egypt plans to almost double trade in goods and services, from 37% of the economy to 65%.

In 2020, Egypt attracted the second-highest level of foreign direct investment in the Arab world and was the biggest recipient of FDI funds in Africa.

Egypt’s infrastructure upgrades are part of a broader package of economic reforms to improve the country’s business environment and attract investment. Despite the impact of the pandemic, particularly on the country’s vital tourism sector, the Egyptian economy was one of the few emerging markets to experience growth last year. Egypt’s exports in June were up nearly 50% from the same month last year, while its trade deficit fell by over a quarter, according to data from the country’s Central Agency for Public Mobilization and Statistics. In 2020, Egypt attracted the second-highest levels of foreign direct investment in the Arab world, and was the biggest recipient of FDI funds in Africa.

Egypt is Africa’s top manufacturing hub, accounting for 22% of the continent’s value added in this sector, according to OECD, and the country’s reforms seek to boost the country’s manufacturing base. A key component of the economy, manufacturing is set to expand further as the country develops new sectors such as Covid vaccine and electric car production.

The OECD has also recognized, in a report published in July, that a growing number of firms are choosing Egypt as their production base for the African continent and the Middle East, and benefiting from the large number of free-trade agreements signed between Egypt and African, Arab, European and Latin American countries.

Aukus pact attracts mixed response from Asia

It’s been nearly a month since the United States, Britain and Australia stunned the world with their new Aukus pact that will deliver a fleet of nuclear-powered submarines to Canberra. China reacted with rage, angered by what it saw as a clear move by the West to further encircle it. 

France, meanwhile, felt deeply betrayed by Australia’s eleventh hour decision to cancel a long-standing submarine deal with it in place of the new deal. Others have quietly applauded Aukus, and there are some governments that have maintained a stoic silence. 

It is necessary to critically review the diverse responses to one of the most significant security developments in recent decades. 

Asia’s varied reactions to the Aukus security pact between Australia, Britain and the United States offered a fresh indication of just how diverse the region is when it comes to their outlook on the future of the region’s balance of power.

Expectedly, reactions from Australia were particularly fulsome, given that Canberra is the biggest beneficiary of the pact. 

Under the deal, Australia will become only the second country after Britain to receive nuclear-powered submarine technology from the US. 

Prime Minister, Scott Morrison’s government plans to have a fleet of eight nuclear-powered submarines operationally ready in the 2040s.

Among Australia’s foreign policy elite, the move — which resulted in the scrapping of an earlier order for French diesel-powered submarines — was an urgent necessity given fears about increasing Chinese naval assertions in the neighbourhood.

On the opposite end of the spectrum, China responded in blistering fashion and lost no time in painting the pact as the latest effort by the West to strategically encircle the Asian superpower.

Beijing described the deal as “extremely irresponsible”, and mainland analysts echoed that view. 

Lu Xiang, a US-China scholar at the Chinese Academy of Social Sciences, told soon after the deal was announced that it indicated that Australia was “tying itself completely to America’s chariot”.

Reactions by governments elsewhere in Asia put in focus how they viewed the deal through the prism of their own national interests. 

In India, for example, some strategic watchers lamented: what about us? In their view, New Delhi should have been offered the US nuclear submarine technology first, given their intensifying strategic ties in recent years. 

In Japan, contrastingly, the Aukus deal was welcomed amid anxieties over whether Tokyo’s defensive-minded military had the ability to contend with increasing Chinese assertions. 

The government stated publicly that it welcomed the three Western allies strengthening “their commitment to the region”.

Reactions from Southeast Asia -home to the deftest of geopolitical fence sitters - naturally was mixed. 

Singapore, seen as one of Washington’s closest strategic partners in the region, was cautious not to be effusive about the pact. Instead, officials said they understood why the deal was struck and hoped it would contribute constructively to regional peace. 

Neighbouring Malaysia, meanwhile, said it was concerned the pact would “catalyze a nuclear arms race” in the Indo-Pacific.

The Philippines offered what appeared to be a full throated support, with Foreign Secretary Teodoro Locsin saying he viewed Australia’s submarine procurement plan as an “enhancement of a near-abroad ally’s ability to project power” to “restore and keep the balance” of power in the region. It would be foolhardy to consider these positions as set in stone, however. 

Thus far, countries that have maintained strategic silence or offered support for Aukus appear to have taken at face value Australia’s promise that the pact is not aimed at third parties, including China.

But if there is increased volatility in the South China Sea and other hotspots arising from the deal, expect countries to alter their positions quickly. There are after all no permanent friends or enemies in Asian geopolitics — only permanent interests.