Aid is central to Washington's relationship with Cairo. The US has provided Egypt with $1.3 billion a year in military aid since 1979, and an average of $815 million a year in economic assistance. All told, Egypt has received over $50 billion in US largesse since 1975. The money is seen as bolstering Egypt's stability, support for US policies in the region, US access to the Suez Canal, and peace with Israel. But some critics question the aid's effectiveness in spurring economic and democratic development in the Arab world's most populous country - a higher US priority after Sept. 11, 2001...
Now an independent economist, Abdallah says USAID needs to decrease support for the Egyptian government, and increase its support for civil society in order to realize the sort of economic and political reforms that the United States and the Egyptian people desire."[USAID] is distributed by the Egyptian government in an anarchic way, through personal contacts and political influence," Abdallah says.
Each year USAID gives $200 million to the Egyptian government in cash handouts to do with as it pleases. The money is theoretically conditional upon economic reforms in problem areas such as deregulation, privatization, and free trade. Most Egyptian economists and businessmen, however, agree that few positive economic reforms have occurred."The role of the state in Egypt is still very similar to the role of the state in Eastern Europe in the 1960s," says Tarek Heggy, the former head of Shell Oil in the Middle East, and a prolific writer on Egyptian society. "I am not aware of much economic reform."
USAID has been ineffective at changing economic policy here because Cairo knows that in the end it will get the US money regardless of its economic policy, according to Walker, who since leaving the State Department has become head of the Middle East Institute in Washington.
