CONTENTS

1. EU “Fast-Track” Candidates Fall Short On Environment
2. Israeli Election Results Produce Cautious Optimism Within Region
3. Jordan Agrees To IMF Economic Restructuring Program
4. MEDA Programs To Support Energy And Economic Restructuring
5. Modernization Program To Accelerate Industrialization In Egypt
6. Egyptian Energy: New Sources And New Production
7. Arab Capital Conference Held In Beirut
8. Conference Held on Promoting Regional Cooperation In Agricultural Trade
9. News In Brief
10. Announcements
11. Events

EU “FAST-TRACK” CANDIDATES FALL SHORT ON ENVIRONMENT

All six countries on the “fast track” to joining the European Union, including Euro-Med partner Cyprus, and five eastern European nations, are said to be far from meeting EU requirements in terms of upgrading and implementing environmental regulation.  The nations are hopeful to become full members of the EU within the coming 3-5 years, however, acting EU Environment Commissioner Ritt Bjerregaard warned that none of the six candidate nations seem on track to meet their obligations to implement environmental protection measures by the designated target dates.

Of particular concern were the areas of water quality, waste-water treatment, and industrial pollution.  Of the six, Cyprus was thought to face the least difficulty in actually meeting the criteria, however, it is thought that all six will need either to postpone their accession dates and/or receive an official temporary exemption in order to fully come in line with EU regulation.   Such exemptions, if granted, however, could reduce the credibility of the EU’s commitment to environmental protection as a priority issue area.

ISRAELI ELECTION RESULTS PRODUCE CAUTIOUS OPTIMISM WITHIN REGION

The sound victory of challenger Ehud Barak over incumbent Benyamin Netanyahu in Israel’s recent Prime Ministerial elections gave a renewed hope for progress in the stalled Mid-East peace process.  Barak’s victory, welcomed not only by the majority of Israelis, but by leaders throughout the Middle East and abroad, was seen more as a referendum rejecting Netanyahu than an indication of support for Barak.

Immediately following the election results diplomatic feelers were sent out from around the Arab world, including, notably, from neighboring Syria and Lebanon, indicating that they were interested in and hopeful of achieving a peace treaty with a new Israeli government.  The stalemate in the peace process has been a major stumbling block in progress in realizing the vision of the Euro-Med Partnership’s goals of promoting integration among the Mediterranean countries themselves.

Barak has decided to try to assemble a broad coalition, including not only his natural left and center support-base, but also moderate right-wing and religious parties, in order to assemble a broad mandate for any political agreements reached with Arab partners.  Such a coalition may complicate reaching any agreements, however, and thus, at least for now, the attitudes among Arab leaders can best be described as cautious, but hopeful.

The Hashemite Kingdom of Jordan agreed to a three-year reform program laid out by the International Monetary Fund (IMF), that includes $220 million in loans to Jordan as part of Jordan’s efforts to promote economic growth rates of 3.5 per cent by 2001.  The economic restructuring upon which the loans are conditioned, is expected to be strict.  Included among the plans are reduction in import duties, tax reform, and privatization of industries, especially within the transportation and mining sectors.

The program comes in response to Jordan’s efforts to scrap or reschedule portions of its US$7 billion foreign debt.  Currently the Kingdom is saddled with international interest payments of US$800 million per year – nearly 20% of the nation’s GNP.   The Paris Club, a grouping of many of Jordan's major state creditors, agreed to reschedule $1 billion of the Kingdom's foreign debt.  King Abdullah, however, had been pushing for debt forgiveness to the tune of US$3.5 billion, stating that only large-scale debt relief would allow for economic growth.

Editor’s Note: Broad economic restructuring programs, including many imposed by the IMF, have come under criticism by many environmental and development organizations, as they often encourage government budget cuts in “peripheral” areas, such as environment and health, while at the same time encouraging environmentally detrimental industry and agricultural practices.   Jordan’s restructuring program has committed to developing a “social safety-net” to protect the countries poor.  Whether there is room in this net for environmental concerns remains to be seen.

MEDA PROGRAMS TO SUPPORT ENERGY AND ECONOMIC RESTRUCTURING

The European Commission and Tunisia agreed on a 9.6 million Euro financing package designed to support small-scale enterprises while Tunisia undergoes economic restructuring, including wide-scale privatization.

The MED Committee in the EU indicated its desire to approve three financing proposals worth 7.5 million Euro, including two dealing with energy production, and one supporting development organisations.   Under the plans the Euro-Mediterranean Energy Forum would receive 2 million Euro for various working groups in order to prepare the region for the energy demands of a Mediterranean Free Trade Zone, while 1.5 million Euro would be dedicated to promoting use of solar thermal energy for uses such as water heating in Algeria, Egypt, Lebanon, Morocco, the Palestinian Authority and Tunisia.  Application of such techniques is already wide-spread in some partner countries, such as Israel and Jordan.  In addition, a further 2 million Euro was approved for promotion of grassroots development organisations, including NGOs, in Morocco.

Morocco also is taking on a European Investment Bank (EIB) lending package priced at 100 million Euro in order to upgrade the industrial facilities for the mining, processing and marketing of Moroccan phosphate.  Morocco is the world’s leading exporter of phosphate and phosphoric acid.  Among the stated goals of the project is the reduction of the industry’s environmental impact.  Another EIB loan to Morocco worth 23 million Euro is designated to improve and extend sewage collection and treatment facilities in Maknes.

MODERNIZATION PROGRAM TO ACCELERATE INDUSTRIALIZATION IN EGYPT

An Industrial Modernization Programme (IMP) was recently initiated an in Egypt by the European Union (EU).  The initiative is intended to improve the efficiency, export capacity and competitiveness of Egypt’s industrial sector.  The Egyptian Ministry of Industry has emphasized that this industrialization process is a priority in order to achieve steady development and capability to compete in a free market economy.

The IMP initiative is intended to rectify problematic areas identified in a one-year assessment of the current state of Egyptian industry currently being conducted. The Programme will concentrate primarily on small and medium-size industries, introducing automation into designated priority sectors and attempting to help Egyptian production meet EU industrial standards.

The IMP will be initiated at an estimated cost of $1 billion.  The EU, Egypt’s largest trading partner and a potentially very lucrative market for Egypt, will provide $300 million for the first four years.  After this four-year period other donors are expected to fund the Programme.

EGYPTIAN ENERGY: NEW SOURCES AND NEW PRODUCTION

BG Egypt, a UK based energy exploration company, announced the discovery of a sizeable natural gas reserve in the Mediterranean off Egypt’s northern coast.  According to the Financial Times, the find is the tenth in this area in two years and is expected to yield 45 million cubic feet per day.

In separate news, the Egyptian government closed a deal worth US$760 million with Electricite de France to build two gas-powered energy production plants.  The two plants, to be located along the Suez canal, will be operated by EdF for 20 years, after which time they are to pass over to Egyptian governmental control.  Such European led build/operate/transfer schemes in power generation are under way in Tunisia, Morocco as well as Egypt.  The energy deal was officially signed parallel to a French trade fair in Egypt attended by over 250 French companies looking to develop Franco-Egyptian business ties.

ARAB CAPITAL CONFERENCE HELD IN BEIRUT

Lebanon, once the unchallenged financial capitol of the Arab world, has once again attracted the attention of the region’s business sector.  A conference on Arab capital markets was hosted in Beirut on May 12-14.  The three-day conference was sponsored by the Lebanese Central Bank, the Bankers’ Association and the International Finance Corporation.  In attendance were over 500 hundred participants from over 20 countries, including dignitaries from Arab governmental ministries, as well as from the European Union companies and high-level representatives of several public and private-sector Arab businesses.  Within the framework of the conference, various seminars and workshops were organized on issues such as investment opportunities in the region, risk management for banks, dealing with rating agencies, electronic commerce, and information technology.

CONFERENCE HELD ON PROMOTING REGIONAL COOPERATION IN AGRICULTURAL TRADE
A conference on “Regional Agriculture – Facing the European Markets” sponsored by the Israel Palestine Center for Research and Information (IPCRI) and Germany’s Konrad Adenauer Stiftung was held in Taba, Egypt, May 23-25.  In attendance were senior representatives of the Egyptian, Israeli, Jordanian, and Palestinian Ministries of Agriculture, as well as select representatives of the private sector and of NGOs.

Among the topics covered in conference discussions were:

• difficulties encountered in obtaining both information and technology necessary to meet European standards,
• the role of limited water resources for agricultural production in the region,
• the potential for trade in organic agricultural goods, and
• problems in transporting goods within the region, especially those experienced by Jordanian and Palestinian producers who rely on Israel for port facilities.

The recommendations of the program included:

• Convening of a regional forum for harmonizing appropriate quality and safety standards and for developing a common export strategy vis-à-vis the EU
• Establishment of joint regional programs for development of water desalination techniques and technologies.
• Extension by the EU of support and aid within the Euro-Med framework to facilitate cooperation within the agriculture sector among the Southeast Mediterranean countries.

NEWS IN BRIEF

• Jordan’s Ministry of Agriculture announced a long-term plan to promote the use of integrated pest management (IPM), a move which is hoped to dramatically reduce pesticide use.  The initiative is being supported by Germany’s GTZ to the tune of over US$4 between 1999-2001.  Last year Jordan banned 16 different pesticides and is looking to bring its cultivation more in line with European standards in order to facilitate exports.  Currently the EU represents only a small share of Jordanian agricultural trade, which is currently designated primarily for other Arab states.
• The European Commission proposed granting association agreements to Macedonia and Albania.  While the announcement was ostensibly made in order to promote a degree of stability to the war-stricken countries, it is far short of the full membership in the EU sought.
• EU-Mercosur talks on establishing a free trade zone between the two regions have stalled, primarily over agricultural issues.  Several EU countries are insisting that agriculture be left out of any initial agreement, as is the case in the Euro-Med Partnership.  The Latin American countries of Mercosur, however, feel that such moves would remove the primary incentives for signing any trade agreement.  The countries will meet in an EU-Latin American summit in June in Rio.
• Several environmental and development NGOs have begun actively opposing the initiation of a comprehensive “Millenium” trade round in the World Trade Organisation.   Such a new round is supported by the EU, which seeks to introduce such topics as investment regulations, electronic commerce, information technologies, and possibly environmental issues.  It is opposed by developing nations including Egypt and members of SAARC - the South Asian trade area, and several African nations, who insist that proper assessment be done of the Uruguay Round agreement, currently in effect, before any further liberalization occurs.

ANNOUNCEMENTS

2000 Dubai Award: Call for Best Practices

The Dubai International Award for Best Practices in Improving the Living Environment (DIABP) recognizes initiatives which have made outstanding contributions to  improving the quality of life in cities, communities, eco-systems and eco-regions around the world.  Each of the ten Awards consists of a US$30,000 cash prize, a  trophy and certificate. The Award is open to all organizations from the public, private and civil society sectors.  The deadline
for submissions is 31 March 2000. Substantive feedback will be provided to those that submit early. For the complete submission guide in English, French or Spanish, please visit:
http://www.sustainabledevelopment.org/blp/awards/
or contact: bestpractices@unchs.org
Nicholas You, Coordinator

EVENTS

Official Euro-Med Partnership Events

EURO-MEDITERRANEAN COMMITTEE FOR THE BARCELONA PROCESS
When: 8 June 1999
Where: Brussels
 

MEETING OF EURO-MEDITERRANEAN WATER DIRECTORS
When: 4-7 July 1999 (to be confirmed)
Where: Malta
 

JOURNALISTS’ SEMINAR ON ENVIRONMENT AND DEVELOPMENT IN THE MEDITERRANEAN
When: August-September 1999 or November-December 1999 (to be confirmed)
Where: to be determined

SECOND EURO-MEDITERRANEAN MINISTERIAL CONFERENCE ON LOCAL WATER MANAGEMENT
When: October 1999 (to be determined)
Where: Turin
 

Other Related Events

MEDITERRANEAN COMMISSION ON SUSTAINABLE DEVELOPMENT
Working Group on Trade and Environment Meeting
When: June 4-5, 1999
Where: Barcelona
Hosted by the Regional Activity Centre for Cleaner Production of the Mediterranean Action Plan (MAP) and by Plan Bleu.

TAKE BACK THE STREETS – GLOBAL STREET PARTY
When: June 18
Where: In city centers throughout the world.
*  For information on activities in Tel-Aviv contact Green Action at <greenman@shani.net>

GLOBAL ISSUES FOR MINING DEVELOPMENT: INDUSTRY CONSOLIDATION, THE  ENVIRONMENT, HUMAN RIGHTS AND COMMUNITY  PARTICIPATION
When: 21-25 June 1999
Where: Dundee, Scotland
Hosted by the Centre for Energy, Petroleum and Mineral Law and Policy, University of Dundee. For
information on these two events contact University of Dundee, DD1 4HN, Scotland, UK,
 tel: (44-1382) 344300, fax: 322578, e-mail: cpmlp@dundee.ac.uk

MEDITERRANEAN COMMISSION ON SUSTAINABLE DEVELOPMENT
When: July 1-3, 1999
Where: Rome

SUSTAINABLE DEVELOPMENT VERSUS ECONOMIC GROWTH?
When: September 24-26, 1999
Where: Berlin
Organized by the Heinrich Boell Foundation in cooperation with
- the Wuppertal Institute for Climate, Environment, Energy,
- the European Society for Ecological Economics (ESEE), and
- the International Society for Ecological Economics (ISEE).
 

Please let us know of any events you feel should be listed.
Contact us at: mftz@gmx.net

MFTZ Environment Monitor
Produced by:  Friends of the Earth Middle East (FoEME)
e-mail: info@foeme.org
Website: www.foeme.org

MFTZ Environment Monitor is produced in collaboration with Friends of the Earth International’s Trade, Environment, and Sustainability (TES) program.  Copies of all issues of MFTZ Environment Monitor can be found on the MFTZ Environment Watch Website at: www.foeme.org/mftz

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