PREVIEW
Washington boosts US companies as it courts Cairo but its $625m deal falls short of a funding guarantee
Known as US President Donald J Trump’s ‘favourite dictator’ Egyptian president Abdel Fattah el Sisi is reaping some financial benefit for his government from that embarrassing accolade.
The Trump administration is offering El Sisi investment of US$625 million over a five-year investment deal. The ‘Strategic Objective’ Agreement offers a guaranteed $125m in grants in the first year, and promises to increase private sector investment in water management, artificial intelligence and energy, plus food security through science-based agriculture. The cash is a recognition of Egypt’s economic vulnerability due to the disruption to the Strait of Hormuz following the US-Israeli war against Iran (AC Vol 67 No 6, A vulnerable recovery under pressure).
The deal has been trumpeted by El Sisi as international endorsement of his government and its regional strategy.
But the US embassy in Cairo has said that the $125m corresponds to the sum that the US was previously spending on US Agency for International Development projects in Egypt, suggesting that the money has just been repackaged but doesn’t qualify as a new financial initiative.
It is consistent with the Trump administration’s efforts to replace USAID with bilateral deals focused on the private sector. Washington brokered a series of bilateral health accords with African states last year, focused on promoting private medicine and US medicare firms.
Egypt was one few African countries to see increased trade with the US last year, with bilateral trade in goods and services reaching an estimated $16.1 billion in 2025, up 28.9% from 2024, according to the Office of the US Trade Representative.
In September, the US State Department waived human rights conditions for more than $300m of military aid to Egypt, pointing to Cairo's ‘helpful role’ since the launch of the US war with Iran.
‘Exercising this waiver authority is essential for the US-Egypt relationship and US national security priorities, particularly in light of Egypt's helpful role following Operation Epic Fury,’ said a State Department memo signed by Secretary of State Marco Rubio.
But that decision was condemned last week by Democratic party Senator Chris Murphy, a member of the Senate Foreign Relations Committee, who accused the US government of ‘abandoning’ human rights conditionalities, pointing to a series of arrests of journalists in Egypt.
Trump’s predecessor, Joe Biden, withheld military aid from Egypt citing human rights abuses (Dispatches, 4/10/23, US senator moves to block military aid to Egypt over rights abuses & Dispatches 21/9/22, Washington makes symbolic cuts to Cairo's military aid).
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