U.S. senators seek free-trade pact with Egypt

WASHINGTON, August 4 (Reuters) -- Twenty-six U.S. senators have asked the Clinton administration to negotiate a free trade pact with Egypt, arguing that it would bolster Middle East peace and help U.S. farmers.

"A free trade agreement would move our relationship to one of 'trade not aid,' and would help ensure Egypt's continued ability to increase its purchases of American goods, commodities and services," the senators said in a letter to President Bill Clinton, released by aides on Friday.

The United States already has a free trade agreement with Israel, and is working on a similar pact with Jordan.

"Adding Egypt to this free trade zone would form the basis for a Middle East Free Trade Region comprising all of the peace partners," the senators wrote. Egypt is one of America's most important allies in the Middle East and was the first Arab nation to make peace with Israel in 1979.

Egypt was the United States' 33rd-largest export market in 1999. U.S. imports from Egypt totaled $617 million, compared to U.S. exports to Egypt of $3 billion. The country is a top market for U.S. wheat growers.

The letter, dated July 28, was signed by 26 senators, including Nebraska Republican Chuck Hagel and Connecticut Democrat Joe Lieberman. It was also signed by Senate Agriculture Committee Chairman Richard Lugar, an Indiana Republican, and Senate Appropriations Committee Chairman Ted Stevens, an Alaska Republican.

Since 1992 the Egyptian government has stepped up the pace of market-opening reform, reducing some barriers and tariff rates. But Washington complains that tariffs on a number of products have remained high and other trade barriers have handicapped U.S. exporters.

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