- Feb 10, 2005
- Reaction score
- Montgomery, Al
I don't get it. We are at war with Muslims and we send them more of our borrowed money? What's wrong with this picture?
WASHINGTON—President Barack Obama will announce this week a new aid plan for the Middle East and North Africa that U.S. officials say will be far bolder than previous American economic assistance to the region.
Mr. Obama will outline the plan, which could include debt cancellation and a reprogramming of financial aid the U.S. already provides to countries like Egypt, in a speech he is scheduled to deliver Thursday at the State Department.
Whatever aid he announces, though, is unlikely to assuage Arab governments, which had been hoping the White House would push forcibly for a resumption of Palestinian-Israeli peace talks. The president's aides say his speech will focus only briefly on the issue.
"At the end of the day, the Palestinian cause remains a dominant issue," said a senior Arab official. "A speech by the president without addressing the conflict is unlikely to generate much enthusiasm."
Power Shifts on Foreign-Policy Team
Mr. Obama met Tuesday with King Abdullah II of Jordan, who has been pressing U.S. officials to take a more aggressive role in the peace process, according to Arab diplomats.
After the meeting, Mr. Obama said the U.S. will provide Jordan with hundreds of millions of dollars through the Overseas Private Investment Corporation, the government institution that finances and insures private business to promote economic growth. The result, according to the U.S., will be roughly $1 billion for economic activity in Jordan. The president also pledged 50,000 metric tons of wheat.
"All of this will help to stabilize the cost of living and day-to-day situation of Jordanians and will provide a foundation so that these economic reforms can move forward and long-term development can take place," Mr. Obama said.
The president's goal, officials said, is to give a financial boost to the political change sweeping the Mideast and North Africa, where dashed economic aspirations have fed unrest.
Senior U.S. officials are particularly alarmed by the deterioration in Cairo's finances since the street revolt that ousted President Hosni Mubarak in February. The Egyptian government has been forced to spend between $3 billion and $3.5 billion of its foreign-exchange reserves a month to pay for food and other commodities as tourism has plunged and overseas remittances have dried up.
Egypt's government has been seeking relief on around $1 billion in debts tied to wheat purchases in the 1970s, according to officials involved in the talks. Cairo has paid off the principal on these loans, but continues to service interest payments.
The administration is looking at a mixture of direct aid, debt relief, and export credits to help stabilize Egypt's finances. "There are a whole range of tools we could use," said a U.S. official. "We've been looking for the right mix."
Mr. Obama's speech will come ahead of action on economic and trade initiatives that the Group of Eight economic powers are poised to take during their summit in France next week. Leaders are working on a short-term stabilization package, particularly for Egypt and Tunisia, that would involve international financial institutions and perhaps some of the Persian Gulf states, according to a G-8 diplomat.