Egypt plots strange course on foreign policy
Financial Times
By Roula Khalaf

It seemed reasonable to assume that Egypt’s revolution would usher in a new assertiveness in foreign policy, restoring the regional role that had been eroded under Hosni Mubarak.
 
That the largest Arab nation’s authority had been eclipsed by subservience to western powers was one of the sources of frustration with the Mubarak regime.

Remember the immediate post-revolution slogan of Egyptians? “Lift your head high, you are Egyptian,” they chanted.
 
Egypt’s military rulers, however, have a strange understanding of what boldness entails.
 
They are not leading the way on Syria, for example, by adopting a policy at the Arab League that Syrian opposition activists describe as ambiguous if not confused. Instead, they have chosen to pick a fight with the US, jeopardising the $1.55bn a year of mostly military aid over a case of funding for non-governmental organisations.
 
On Sunday, the trial of 45 NGO workers opened in Cairo only to be promptly adjourned until April. Those facing charges of illegally receiving foreign funds and working without licences include 19 Americans, one of whom is the son of the US transport secretary.
 
The NGOs – among them the National Democratic Institute and the International Republican Institute – were allowed to observe Egypt’s first democratic parliamentary elections; indeed they gave the ruling military council good marks on the conduct of the vote. They had been working in Egypt for years under the Mubarak regime and had applied for licences in the past but assumed that a lack of response was as good as a green light to continue operating.
 
The crackdown appears aimed at bringing all funds flowing to NGOs under government control. The prosecutor reading the charges against the defendants on Sunday said receiving “illicit” funds “detracted” from the state’s sovereignty.
 
The anti-NGO campaign, moreover, has been led by Fayza Aboul Naga, the minister of international co-operation and a survivor from the Mubarak regime. She has been a leading advocate of controlling NGO funding, a controversy that gained added prominence when the US began distributing grants directly to unregistered as well as registered NGOs in the wake of the revolution.
 
But why allow the pursuit of this objective to develop into a diplomatic crisis? There are all kinds of theories circulating about what lies behind the authorities’ behaviour.

They range from claims that the military is convinced the NGOs are encouraging young liberal revolutionaries to push for an end to military rule, to suspicion that stirring up anti-US sentiment could improve the image of a military council tarnished by inept management of the political transition. There are even suggestions that the whole issue has been somewhat hijacked by remnants of the former regime, keen to prove that the military authorities are not in control of Egypt.
 
The absurdity of the case is that the generals are the biggest recipients of American aid in Egypt – and they are putting that assistance at risk by going after much smaller amounts the US is spending on promoting democracy. Along the way, the generals are not only undermining Cairo’s crucial relationship with Washington. They are also sullying the image of the new Egypt, which looks as arbitrary as the old one, except with a lot more unpredictability.
 
Worryingly, the country’s new parliament led by the Muslim Brotherhood is backing the crackdown. Some of the ultraconservative Salafi Islamists, meanwhile, seem to think they can replace US weapons with a donations drive.
 
What makes the NGO case alarming is that it comes at a time when Egypt’s economy is in crisis. Foreign exchange reserves are depleting rapidly, which means Egypt desperately needs financial support from the International Monetary Fund and other foreign donors.
 
According to central bank data released earlier this month, reserves were $16.4bn at the end of January, down from $36bn in December 2010, just before the revolution. Foreign donors, however, need stability and predictability – attributes that the NGO case is proving are sorely lacking in post-revolution Egypt.