President Mohamed Morsy met Sunday with president of the European Council Herman Van Rompuy and discussed methods to strengthen bilateral relations amid political and economic developments.
The meeting was a continuation of talks between Egypt and the European Council held in Brussels in September 2012. During Morsy’s first official visit to the EU, Belgian Rompuy had offered Egypt €5 bn in the form of grants and concessional loans.
The promised financial assistance has not been delivered however. But in a press conference with Morsy on Sunday, the European Council president said: “We still pledge the €5 bn grant for 2012/2013 in support of Egypt’s democratic transition.”
On 14 November 2012, Morsy met with the EU’s high representative for foreign affairs and security policy Catherine Ashton and discussed methods to strengthen ties between Egypt and the EU. At the meeting, Morsy announced that the EU had approved the €5bn grant to Egypt as a “support package” to be disbursed via the union’s financial institutions.
Rompuy linked the EU’s grant with ongoing discussions over the sough-after IMF loan. He said: “a large amount of this grant should be utilised along with the special preparations of the IMF loan.”
He added: “The EU welcomes the ongoing discussions with the IMF, nevertheless delaying action is not an option,” stressing that approving the loan will help “regain the trust of investors and tourists in Egypt.”
On 7 January, Morsy met with IMF senior official and resumed talks on the requested $4.8 bn loan.
Rompuy and Morsy also discussed the possibility of launching the largest free trade area between Egypt and the 27-nation bloc. “The EU is the top trading partner to Egypt,” Rompuy said.
The recovery of assets was also a topic of discussions. Rompuy highlighted that the EU will discuss with European countries efforts to facilitate the return of Egyptian assets. “We have taken decisions and we are playing our role with the involved countries to make our cooperation more efficient and facilitate the recovery of assets,” he said.
Since March 2011, Britain has frozen £85m of Egyptian assets, which are considered to be misappropriated funds belonging to former President Mubarak. More than 18 former regime figures have had their assets frozen in the EU.
The two leaders also discussed political developments in Egypt after the passing of the new constitution. “I told President Morsy that you have an extraordinary task with other political and social forces to push for achieving national dialogue. We wish you success,” Rompuy said.
Talks also included discussions over the “worrying developments” that took place over the past weeks in Egypt.
On 25 December 2012, Egypt’s new constitution was officially passed in a public referendum. The result was a 63.8% margin of support for the constitution. The presidential palace continues to hold national dialogue sessions to debate controversial articles. Opposition groups protest against the constitution and the Shura Council’s discussions to finalise the new elections law.
Rompuy said he advised Morsy to intensify his efforts to ensure consensus building, inclusiveness and dialogue between all involved parties.
In preparations for the upcoming parliamentary elections, the European Council president said the “EU is ready to send an electoral observation mission to Egypt.” Morsy did not respond as to whether Egypt will receive the EU mission, but said parliamentary elections should be held after almost three months. “By holding these elections, we would be completing in our path towards the establishment of state institutions and that aspires to good governance.