Or so it would seem, judging the good economic news coming out of the Holy Land recently.
On December 14, the United States, Egypt, and Israel agreed to a historic trade partnership. And just a day before, the World Trade Organization agreed to begin membership talks with Afghanistan and Iraq.
The WTO discussions may take a long time–everything involving the WTO takes a long time. But they also represent an important step for two countries that desperately would like to rejoin the community of nations. Afghanistan and Iraq are both troubled places, and increased trade is no panacea for their problems–but it is also a necessary precondition for their revival.
The new partnership between the United States, Egypt, and Israel holds great promise as well. “This is the most important economic agreement between Egypt and Israel in two decades,” said U.S. Trade Representative Robert B. Zoellick.
The accord creates three special trade zones within Egypt. Products from these regions–in Alexandria, Cairo, and the Suez Canal/Port Said area–will enjoy duty-free access to U.S. markets if 35 percent of their components are the result of Israeli-Egyptian cooperation. This special access is made possible by a 1996 law.
Jordan began taking advantage of the opportunity several years ago. More than 35,000 new jobs have resulted–and these Qualified Industrial Zones (as the bureaucrats call them) continue to spark job growth. Combined with the U.S.-Jordan free-trade agreement, these QIZs have helped Jordanian exports to the United States boom from $31 million five years ago to roughly $700 million today.
The wonderful irony of the QIZs is that they force age-old rivals to cooperate. Israel and Jordan are now friendlier than they once were. We can reasonably hope that increased economic links between Israel and Egypt will lead to more friendship–and less violence in a part of the world that already endures too much of it.
The Egyptians and the Israelis certainly feel this way.
“It is our deep belief that the establishment of [QIZs] will contribute to just and comprehensive peace in the region,” said Rachid Mohamed Rachid, the Egyptian trade minister. “The time has come now to work hard, to spare no effort, and to leave no stone unturned as we strive to further the progress of peace in the region.”
“I am very proud of this agreement,” said Israeli trade minister Edud Olmert, “and I hope that it will be a precedent for many other countries in the Middle East and that additional countries will find out that having peace with Israel means not just good neighborly relations, but opens up great opportunities for economic trade, business relations, and the improvement of the quality of life for all peoples involved.”
I like that phrase: The improvement of the quality of life for all peoples involved. That’s what free trade is all about.
President Bush understands this, and he has proposed the creation of a Middle East Free Trade Agreement by 2013. We already have stand-alone free-trade deals with Israel, Jordan, and Morocco. We’ll have another one soon with Bahrain, assuming Congress approves it. Negotiations are set to begin next year for pacts with Oman and the United Arab Emirites. But a MEFTA would eclipse them all.
I can’t think of a better time of year to receive this good news. Although most Americans celebrate Christmas, there aren’t very many folks in the Middle East who do–and yet they, of all people understand the importance of that favorite Christmastime phrase, “peace on earth.”
“I can’t create a peace process,” said Zoellick at a press conference in Cairo. “I can’t tell you how you are going to make Middle East peace, but I can say that if we help people recognize the benefits of working together as opposed to shooting one another, that’s a good step.”
And a wonderful Christmas present, too.