CAIRO: United States aid to Egypt is expected to remain unchanged in 2011, with the same NGO funding restriction and a projected 2 percent allocated to democracy promotion, according to a recent report. US President Barack Obama's budget proposal for Fiscal Year 2011 continues to give financial aid to Egypt at a constant level, but also continues a controversial 2009 decision to restrict financial aid to NGOs sanction Egyptian government-sanctioned NGOs, as well as creating a special “endowment” to be managed by the Egyptian president's office. The suggested budget proposes $1.56 billion in aid to Egypt, to be distributed through a wide variety of US governmental organizations — the same amount as requested for FY 2010. Of that $1.56 billion, $1.3 billion (84 percent of the total) is allocated for military assistance, as part of the US government's Foreign Military Financing initiative. That number has remained constant since 1987, and is currently required by a 10-year agreement between the US and the Egyptian government, signed in 2008. The remaining $250 million (16 percent of the total request) is allocated for civilian aid. Of that $250 million, $25 million (2 percent of the total request) is specifically earmarked for promoting democratic growth, as part of the government's Governing Justly and Democratically (GJD) fund. Originally, the Obama Administration only requested $20 million for the GJD, but a recent earmark by the US Congress required “not less than $25 million shall be made available for democracy, human rights, and governance programs.” The Obama Administration subsequently raised the GJD request to $25 million. The $250 million in aid comes with restrictions some find troublesome. The proposed budget continues a controversial decision by the Obama administration to require the United States Agency for International Development (USAID) to only distribute its funds to Non-Governmental Organizations (NGOs) officially registered with the Egyptian government. “Many Egyptian civil society groups, however, choose not to register as an NGO for fear of heavy-handed government interference,” said Stephen McInerney, Director of Advocacy for the Project on Middle Eastern Democracy in Washington, DC. “Many other organizations do try to register with the Egyptian government, but do not receive approval.” Writing in a report critiquing President Obama's budget, he continued, “making funds available only to those groups that do receive Egyptian government approval for their NGO registration essentially gives the Egyptian regime veto power over the recipients of its civil society direct grants.” He added, “Many observers … view this change in policy as contradicting the language of the annual appropriations act.” That congressional act states that “with respect to the provision of assistance for democracy, human rights, and governance activities, the organizations implementing such assistance and the specific nature of that assistance shall not be subject to the prior approval by the government of any foreign countries.” In other words, the act explicitly does not require US Government funds to only go through locally-sanctioned NGOs. “This policy decision … certainly does appear to violate the spirit and intent of [this act's] language,” McInerney said. The Obama Administration has defended this action by noting only USAID is required to abide by this restriction, and that the Bureau for Democracy, Human Rights, and Labor (DRL) at the US State Department, as well as the Middle East Partnership Initiative (MEPI), created under President George W. Bush, are still free to invest in NGOs not approved by the Egyptian government. However, these organizations have been allocated approximately $3 million, whereas USAID routinely contributed approximately $10 million to unregistered groups before the restrictions first appeared, in FY 2009. This amounts to a continuing 74 percent cut for non-registered NGOs, according to McInerney. The other element of the proposed budget some find controversial consists of $50 million allocated to a “bilateral endowment” between the US and Egyptian governments. “The idea is that the US government would deposit funds into the endowment for a period of years, after which the Egyptian government would be able to draw on the fund without the uncertainty of congressional appropriations,” McInerney said. The proposal has been criticized by some observers. “[This] amounts to a trust fund for Hosni Mubarak's regime,” said Gregg Carlstrom, a writer at the Middle East affairs blog The Majlis. “Mubarak can use the money in the endowment — and the dividends earned on investment — however he wants; the money is already appropriated, so Congress cannot impose any conditions.” The endowment fund originated in a 2007 proposal by New Hampshire Senator Judd Gregg, a Republican member of the Senate Appropriations Committee, to create a “United States-Egypt Friendship Endowment,” with an original budget of $500 million. He amended the FY 2010 omnibus bill to allow for this $50 million endowment, according to Foreign Policy. Ratification of a US president's budget is no easy process. It is first subjected to intense scrutiny and debate in the US House of Representatives, and then, if approved, the US Senate repeats the process. Due to the wide range of areas the budget covers, the process can take many months.
