In spite of joining the war in Iraq, Australian trade with the Arab world has dramatically increased. Gamal Essam El-Din spoke with Peter , managing director of the Australian Trade Commission (Austrade), who was visiting Cairo last week Does your visit to Cairo reflect a new Australian interest in promoting trade relations with the Arab world, particularly Egypt? First of all, let me explain that Austrade is the counterpart of Egypt's Commercial Representation Agency. It is the Australian government agency that helps Australian companies win overseas business for their products and services. With this visit, I explored the possibilities of strengthening commercial and business relations with the Middle East, particularly Egypt. We decided to increase our trade missions in this region and encourage Australian companies to fully tap its markets. The reason for this strategic move is that the Middle East has been the fastest growing region in the world for Australian exports in recent years. For example, Australian wheat exports to the Middle East have grown so much that now they account for more than one-third of total Australian wheat exports. My visit is aimed at helping Australian companies build stronger relationships with their counterparts in Egypt. Not only is Egypt a big consumer market in the Middle East, but it is also a gateway to Australian exports to Arab and African markets. We want to see business between Australia and Egypt extend beyond agriculture to cover other important areas. So, which officials did you meet in Cairo and what topics did you discuss? I met the Foreign Trade Minister Youssef Boutros-Ghali and El-Sharqawi El-Hefni, chairman of the Commercial Representation Agency. Boutros-Ghali visited Australia in November 2003 and met with Australian Trade Minister Mark Vaile. They discussed the prospects for cooperation on a variety of issues such as developing strategic alliances with Australian commodity exports and technical assistance to Egypt for export finance and anti-dumping. Vaile visited Cairo in June 2003 for a WTO mini- ministerial meeting and a resumption of trade discussions with Boutros-Ghali. Traditionally, Australian companies have been mainly agricultural. They are mostly involved in wheat and livestock production. But we would like to see other kinds of Australian companies coming to Egypt, especially those with expertise in information technology, medical equipment and car manufacturing. I told Boutros- Ghali that there is a big opportunity for doing business in these areas. Have your talks with Boutros-Ghali involved the possibility of establishing a free trade agreement with Egypt? We recognise that a big reason for the growth of trade between the Arab world, Europe and the US is largely due to recently signed FTAs. As a matter of fact, a big part of Boutros-Ghali's 2002 visit to Australia was aimed at negotiating an FTA between Australia and Egypt. During my visit, we resumed talks and discussed the Trade and Investment Framework Agreement (TIFA), an important step in the abolition of trade barriers between our two countries. Australia is an open economy and it would like to see its partner in a free trade agreement with an equally open economy. How do you see the economic relationship between Egypt and Australia? The bilateral cooperation between Egypt and Australia is focussed on trade and investment. Egypt is Australia's 44th largest trade partner. Bilateral trade is substantial, but does not reflect the full potential of the markets. In 2002- 03 two-way merchandise trade totalled $391 million. Australian exports totalled $370 million, consisting mainly of livestock, wheat, fresh vegetables, coal, butter and cream. Imports from Egypt totalled $20 million (excluding services such as tourism and transport) consisting mainly of fertilisers, floor covering, other manufactured textiles and furniture. Australia ranks as Egypt's 11th largest import source. Also, some 45,000 Australian tourists visited Egypt in 2000-01. I hope the proposed TIFA and increased tourism and investments will significantly push our trade relationship forward and fully realise the potential of our two markets. In recent years, Egypt turned to Australia to meet its growing needs of wheat, thereby increasing competition in the wheat market. Have your talks covered this important issue? Traditionally, Australian companies have been agriculturally-based, specifically focussed on exporting wheat and livestock. A main reason for our interest in the Egyptian market is its increasing demand for wheat and livestock. There is a wide understanding in Egypt that Australian wheat is high quality and relatively inexpensive. In all of its markets Australia seeks to build customer relationships to ensure markets of a consistent and high- quality supply of not only wheat, but all kinds of other goods as well. Has Austrade registered any negative impact on its trade with the Middle East since Australia joined the US in the war in Iraq? Not at all. As I told you, our wheat exports to the Arab world have increased so dramatically that they now account for one-third of total Australian wheat exports. Also, half of Australia's livestock exports now go to the Middle East. Australian exports to Egypt declined, but this was largely due to the fact that the Egyptian pound fell by some 59 per cent against the Australian dollar during 2003, causing a large increase in the prices of Australian goods.