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Some reforms take longer than others. A third of Egypt’s population remains in the agricultural sector and growth in overall consumer spending is undercut by subsidies for food, housing, and energy. More than 7 percent of Egypt’s GDP is dedicated to government subsidies, and an expansive public sector payroll has dampened growth in the service sector. The Government of Egypt employs six million workers – approximately one-third of the nation’s labor force.

U.S. agricultural commodities continue to lead in export volumes. Year 2006 wheat futures averaged 45 percent higher than 2005 prices, depressing demand and total free-alongside (FAS) quantity of shipments to Egypt.

The fifteenth most populous country in the world, Egypt is becoming increasingly attractive to U.S. exporters seeking dynamic consumption growth. In the words of Minister Rachid: “Egypt is serious about change, and we are open for business.”

Qatar

More quickly than any other nation in the Arab world, perhaps, Qatar has been leveraging its natural resources to bring about significant societal changes at all levels.

The key to this transformation is natural gas. Qatar sits atop the North Field which, at 900 trillion cubic feet, is the globe’s largest known non-associated natural gas field, representing an estimated nine percent of world reserves. Qatar’s gas industry generates $40 billion per year, and the emirate is investing in infrastructure to triple its LNG production and become the market leader, producing 77 million tons by the year 2011.

The Dolphin Project, the region’s first integrated energy network, will carry Qatari natural gas to the United Arab Emirates in 2007 and the Sultanate of Oman in 2008. This $7 billion project, underway since 2001, will initially provide two billion cubic feet of gas per day to the UAE.

One of the most important beneficiaries of the emirate’s gas revenues is the Qatar Foundation, founded in 1995 by H.H. the Emir and chaired by First Lady Sheikha Mozah. The Foundation is committed to the principle that a nation’s greatest natural resource is its people, and with this in mind, it is forming partnerships with U.S.

entities that will “prepare the people of Qatar and the region to meet the challenges of an ever-changing world.”

The flagship of the Qatar Foundation is the Education City, which has attracted such U.S. institutions of higher learning as Carnegie Mellon, Texas A&M, Virginia Commonwealth, Georgetown, Weill Cornell Medical College and the Rand Corporation. Boston University is expected to join the ranks in 2007.

The Education City is also home to the Qatar Science and Technology Park (QSTP), which is positioning itself to become the “premier location in the Middle East for technology companies and start-ups.” The QSTP is just getting off the ground, but it has already attracted a number of the top multinationals doing business in the region.

Qatar – 2007 Forecast Top Ten Manufactured U.S. Imports ($ Billion)

(SOURCE: IRmep)

In 2007, Qatar is expected to continue its build-out as the regional home of CENTCOM and the base of operations for American forces in the Middle East. Al Udeid air base now services 120 aircraft and 4,000 troops and boasts a 4.5-km runway – the longest in the Middle East.

Qatar Airways signed two deals recently for the purchase of 40 GE90 jet engines from General Electric that will power 14 777-300ER and six 777- 200LR Boeing Worldliners. The passenger jet purchase at list price is approximately $4.9 billion dollars.

Fueled in part by purchases of these civilian aircraft and a construction boom associated with hosting the Asian Games, Qatar in 2007 is expected to become the Arab world’s fourth largest market for U.S. merchandise – up from seventh in NUSACC’s 2006 Outlook.

Iraq

The U.S. role in the rebuilding of Iraq, along with U.S. support for the new Government of Iraq, has led to a major realignment of imports. U.S. exports to Iraq, which were less than $2 million in 1998, are now on track to surpass $2 billion in 2007. »