Egypt is planning to maximise the potential of the Qualified Industrial Zones (QIZ) agreement with the U.S. to unlock $5 billion in exports.
Last year, Egypt reached $1.2 billion in exports under the 2004-agreement, which grants Egyptian products duty-free entry into the U.S. provided they meet a minimum 10.5 percent amount of Israeli content.
The North African country aims to expand the reach of the QIZ deal to include industries like ICT and food to align with the state ambitious plans to reach $100 million in exports in the coming years, a government source with knowledge told Amwal Al Ghad on Monday. It also plans to expand the geographical areas covered by the QIZ to include more zones.
Currently there are around 1,140 QIZ companies in Greater Cairo, Alexandria, the Middle Delta, the Suez Canal area, and Upper Egypt, the source said, adding that there were 16 companies listed after a recent joint committee quarterly review meeting in Cairo late May.
About QIZ Deal
In 1996, the U.S. Congress introduced the QIZ concept to build regional economic partnerships between Israel and its neighbours.
Jordan was the first to join the QIZ protocol, when it had signed a peace treaty with Israel in 1994.
Although Egypt was the first Arab country to sign a peace treaty with Israel in 1979, it did not join the QIZ protocol until December 2004.
The Israeli content requirement under the QIZ protocol started at 11.7 percent but was negotiated down to be 10.5 percent in October 2007.
Since the QIZ took effect in February 2005, it has allowed products jointly manufactured by Egypt and Israel duty-free entry into the U.S. eligible products must have at least 35 percent of their value added by QIZ factories.
Since beginning of April 2017, Egyptian authorities started talks to lower the Israeli input requirement to 8 percent.