CAIRO: In his first official visit to Moscow after being inaugurated on June 8, President Abdel Fatah al-Sisi reached deals Tuesday with his Russian counterpart Vladimir Putin to create a free trade zone with Eurasian countries and a Russian industrial zone in Egypt.
In a press conference between both presidents held Tuesday in Sochi, Russia, Putin said that his country would consider a free trade zone with Egypt.
“The free trade zone will be established in Egypt,” Rashad Abdo, head of the Egyptian Center for Economic Studies, told The Cairo Post Tuesday.
Abdo said the free trade zone will not be limited to just exchanging duty-free products, but also enhance and promote investments between both sides.
Abdo added that former Minister of Foreign Trade Rashid Mohamed Rashid had previously attempted to establish such a system with Russia.
Sisi announced in a press conference following the meeting that Egypt offered Russia the opportunity to establish an industrial zone as part of the Suez Canal Axis project.
“We hope that Russia could establish a Russian industrial zone, coinciding with the launch of the ‘new’ Suez Canal which will be completed within a year,” Sisi added in the conference, which was aired by CBC Extra channel.
As for trade between both countries, Putin said that Russia, the biggest wheat exporter to Egypt, will increase wheat exports to Egypt by at least 5 million tons.
On June 16, the Egyptian General Authority for Supply Commodities announced Egypt had imported 3.3 million tons of Russian wheat from July 1, 2013 to April 30, 2014. Egypt has suffered from a wheat shortage following the last three years of political unrest, and is now the world’s largest importer of the staple, importing 17.4 million tons last year according to UN Data.
Putin, at the conference, said the wheat deal may be reciprocal, and that Russia would try to increase its imports of Egyptian agricultural products by 30 percent.
Russian Agriculture Minister Nikolai Fyodorov told reporters in Sochi, according to Reuters, that Egyptian shipments of potatoes, onions, garlic and oranges should increase. He added this could help compensate a potential shortage of these products following an exchange of sanctions between the EU and Russia over the Ukraine crisis.
The EU agreed on July 29 to impose economic sanctions on Russia for its role in Ukraine, Reuters reported. In a retaliatory step, Putin ordered on Aug. 7 a ban on agricultural imports from the EU, France 24 reported.
Russian investments in Egypt amounted to $65.62 million in January 2013, with 383 Russian companies investing in Egypt according to the Egyptian State Information Service (SIS). Meanwhile, Egyptian investments in Russia amounted to $13.7 million in December 2012, also according to (SIS).
Putin also said Russia and Egypt would expand military cooperation. Sisi during his two-day visit discussed the purchase of anti-tank missile systems, military transport helicopters and gunships and MiG-29 fighter jets, according to Russian state news agency RIA Novosti.
Last February, Sisi visited Russia when he was still defense minister to discuss weapons deals valued at $2 billion.