Tag Archives: Egypt

Refinery Progress Highlight’s Egypt’s Domestic Downstream Push

ImageAfter years of delays and challenges from inside the country and out, Egypt’s new refinery project appears poised to finally break ground and it could not come at a better time.

In the two years since the collapse of the government of Hosni Mubarak, Egypt has faced significant challenges to meeting domestic energy needs thanks to increasing demand, an unsustainable state subsidy program and an overall loss of confidence on the part of production partners. In an effort to cut down on costly imports, the country’s new government has pushed for substitution options, the most notable of which is a $3.7 billion refinery projects helmed by Citadel Capital.

First proposed in 2007, the project has encountered a series of obstacles to completion including a wider global economic slowdown that made securing needed financing all but impossible. More importantly, Egypt became the poster case for the Arab Spring, spurring the collapse of the long-standing government of Mubarak. This development pulled the rug out from under the country’s business environment, again, making financing a difficult goal to reach.

Still, while financing the project took far longer than they expected, Citadel was able to close the process last summer, clearing the way for the project finally moving forward. The facility will produce more than 4.2 million tons of refined product a year, halving the country’s imports and saving the government an expected $300 million during that time. Most importantly for a country facing an increasingly frustrated population that has faced blackouts and cuts in services due to fuel shortages, the facility means a long-awaited boost in downstream capacity.

Citadel was able to meet financing needs with the help of a number of outside actors that looked past the country’s current uncertainty. These have included the African Development Bank, the European Investment Bank and Qatar who have pledged billions in investment and support for Egypt over the last several months.

Other efforts to curb dependence on expensive imports at a time of political and economic volatility have included possible new trade deals with Iraq and a soft credit crude agreement with Libya. 

Image: Arabian Business

Originally Posted: Newsbase Downstream Monitor, All Rights Reserved

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Cairo’s Sinai Efforts Falling Short

Weeks after the Egyptian government pledged action to halt growing unrest in the Sinai Peninsula, military action appears to have had minimal effect on stopping violence and safeguarding the country’s energy trade route to Jordan.

The promised action followed months of growing instability in the region, beginning shortly after the fall of the government of Hosni Mubarak. In addition to a growing number of kidnappings, the Sinai saw 15 direct attacks on natural gas pipelines bound for Jordan and Israel. In early August, a single attack that led to the deaths of 16 Egyptian soldiers spurred newly elected President Mohammed Morsi to launch a military initiative aimed at bringing the region back under control. However, as recently as this weekend, attacks have continued, including one that resulted in the deaths of three police officers in El-Arish.

This latest event was followed by the dismissal of the North Sinai security chief, General Ahmed Bakr as well as protests among local police groups demanding greater attention from government forces and the passage of emergency laws. In response, Morsi once again pledged direct action, but will likely face resistance from a local Bedouin population with a long history of conflict with Cairo.

In addition to the clear goal of returning order to the country’s eastern region, the government’s efforts are especially important to protecting a natural gas export route to Jordan and beyond. Although exports from Egypt have recently halted as Cairo deals with a surge in local consumption and dwindling supply, the country’s ability to exploit domestic reserves for future growth will rely on a dependable export route to the east. According to a Jordan Times report, talks between the two governments have suggested that exports could resume as soon as next month, with a possible boost in quantity on the table.

While the government is working to address local consumption issues through a reassessment of subsidy programs and energy diversification, they have also begun pushing for greater exploration efforts, including both on and offshore projects. Recently, the Morsi government offered tenders for fifteen on- and offshore blocks for natural gas exploration.

Image: The Guardian

Originally Posted in Newsbase’s MEA Downstream Monitor

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Qatar Lays Downstream Foundation in North Africa

As investors and development teams from Europe and the United States keep their cautious distance from the uncertainty of North Africa after the Arab Spring, some financial support and confidence is arriving on the Mediterranean shores, perhaps none more substantial than that of Qatar.

Active and present from early on in the rapidly changing capitals of Cairo and Tunis, Qatari representatives have stepped up their support in recent weeks, signaling a willingness to contribute, including downstream efforts that could prove vital to the region’s recovery and future growth.

Eager to strengthen ties in the region, especially in those states that have seen a shift in political leadership over the past year, Qatar began outlining a series of financial programs earlier this year. In Tunisia, a dormant refinery project was revived in May after Qatar announced that they would again put forth the $2 billion necessary to support a refinery project that could see the country’s output capacity increase fourfold. Boasting an initial output of 120,000 bpd, the plant will eventually produce 250,000 bpd upon completion, as well as 1,200 jobs. By aiding in a post-Tunisia’s efforts to reduce heavy dependence on foreign energy resources and even move them towards a possible role as refined product exports, Qatar is hoping to sew the seeds of good will with the post-Ben Ali government.

In addition to cultivating a relationship with the new government in Libya, Qatar has also worked to help the development of downstream energy projects in a post-revolution Egypt. Earlier this year, Qatar announced a $3.7 billion financing agreement with the Egyptian Refining Company to help support a refining project there, with the Qatar Petroleum set to take on a 25.3 percent stake in the effort, according to a Bloomberg report. Shortly after, the Qatar Investment authority announced a sprawling $18 billion investment plan, with $8 billion set aside for electricity and natural gas projects to the East of the Suez Canal.

The expansion of a North African footprint comes as Qatar has extended its reach into the energy sector, including several recent purchases and expansions of stakes in energy companies across North Africa and Europe. The new funding agreements also challenge the tide of recent state and private investors who have acted with caution when dealing with North African nations.

Image: North Africa United

Originally Posted in Newsbase’s Downstream MENA Issue

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Egyptian Downstream Impact Being Felt

As Egypt’s natural gas potential quickly emerges as one of the country’s strongest forces for recovery, its downstream sector is coming under increasing scrutiny as the reality of questionable capabilities and cancellations start to take effect.

Highly dependent on domestic natural gas reserves for both electricity production and export revenue, Egypt has placed the country’s promising sector at the heart of the post-Mubarak recovery. However, despite a steady increase in interest in exploration and production efforts from outside energy firms, Egypt’s downstream operations remain a sore spot for natural gas sector growth, affecting both needed earnings and domestic energy demand.

The most glowing example of this comes with the country’s pipeline system through the Sinai Peninsula, which has remained a volatile point of militant activity since the fall of the Mubarak government in February 2011. Since then, the pipelines allowing valuable exports to Israel and Jordan have been attacked on 15 occasions. These delays were followed by a cancellation of exports to Israel after the controversial nature of the two countries’ trade agreement became clear. The fragile state of Egypt’s Sinai pipelines claimed its first business victim recently when Israel’s Ampal filed for Chapter 11 due to the loss of revenue as a result of the halt in trade this past April. The company held 12.5 percent of EMG, the institution responsible for delivering Egyptian natural gas to Israel. While the company’s ability to meet debt obligations began as early as December 2011 thanks to the repeated attacks, the April cancellation proved to be the final straw for the firm, according to the Egyptian Ahram Online.

In addition to launching a military offensive in the region to help quell unrest, the Egyptian government is looking to outside funding options to help improve the downstream outlook. Some relief may come from a recently announced $18 billion investment pledge from Qatar, $10 billion of which has been set aside for gas, power, iron and steal plants, according to The Chicago Tribune.

Cairo’s largest energy challenges are rooted in the country’s generous oil and gas subsidy program, which increased 40 percent last year to cost the state $16 billion, or one-fifth of its operating budget, according to Reuters. However, the country’s downstream operations have also become an obstacle to recovery as outside interest has focused on E&P efforts, including a recent $10 billion BP plan over the next five years according to Bloomberg, instead of infrastructure investment.

Originally Posted with Newsbase’s Downstream Monitor

Image: Bloomberg

 

 

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Egypt Sees Some Hope in Nat Gas Tenders, But Will it Be Enough?

Following earlier reports pointing to an expansion of Egypt’s energy exploration and production, Cairo announced last week that they would offer a tender for a collection of on and offshore blocks for natural gas efforts taken on by international partners. The tender was announced after winning approval from the country’s Defense Ministry, clearing the way for the Egyptian Natural Gas Holding Company (GASCO) to begin offering the tender this week and for the next several months.

The exploration effort follows in the footsteps of a number of regional neighbors who have launched similar offshore natural gas efforts, including Cyprus, Lebanon and Israel. Those blocks included in the tender will be located very near or on the country’s maritime border with Israel, offering access to an estimated 223 trillion cubic feet of reserves, according to a United States Geological Survey analysis of the area. Of the 15 total areas included in the tender, 13 are offshore and six are located in waters bordering Cyprus and Israel.

The announcement comes as the country tries to stabilize both their energy and political situation, the latter of which has received a blow in the last week after former president Hosni Mubarak was sentenced to life in prison. Further, the political void he left behind is expected to be filled by either a former Mubarak military official or conservative Islamic candidate  – neither of which appeals to the country’s center or the revolutionary groups the led last year’s protests.

Meanwhile, the country’s energy sector is still reeling from cuts in exports and production brought on by a series of attacks on pipelines in the Sinai and an investigation into corrupt sales practices under the Mubarak government. While Cairo has been able to get deliveries of customers in Jordan back on line, the situation led to an eventual suspension of natural gas deliveries to Israel.

More than just lost revenues, the decision to cancel Egypt’s 20-year deal to supply natural gas to Israel is now resulting in a lawsuit filed by investors in the East Mediterranean Gas for violations of bi-lateral investment treaties, according to a Bloomberg report.

Despite such criticism, the government may have little choice than to support new production deals under the pressure of mounting debt and wavering interest from existing project partners. According to Australia’s The National, the Egyptian government has accrued about $4 billion in debt to international energy firms due in part to large-scale purchases to allow for heavily subsidized domestic sales.

Concerns about that debt and the ability of Cairo to ensure the money to pay for it have been credited for three major fuel shortfalls so far this year, the latest of which saw petrol stations and other sources closed or facing substantial delays last week. According to the Ahram Online news site, the country relies on imports for only 10 percent of its energy needs but has consistently faces funding obstacles, made worse by the unstable environment that has followed the government hand-over.

According to a recent Bloomberg report, the situation has required the country’s finance minister to announce a planned $100 million injection to help the local market meet domestic needs.

The actual shortage has been linked to a number of explanations, from the high consumption of the agricultural sector to a more conspiratorial angle that points to former Mubarak officials planting seeds of instability before the country’s run-off election in mid-June, but the end result and solutions are the same. Egypt needs to increase domestic production and address their liquidity challenges and they need to do it fast. Until they do, suppliers will continue to be wary about signing on to provide for the Egyptian markets or take part in an upcoming $1 billion tender.

The country’s fuel situation reflects a much larger challenge on the part of the new government and whoever wins this month’s runoff to offer some assurance to international lending institutions.

“After the outcome of the first round (of the election), we are much more bearish,” an economist at a major foreign bank, who did not wish to be identified told Reuters. “We see a lot more instability, but the major risk is the long-term outlook. This result does not unlock the situation.”

The report went on to say that Egypt would need a minimum of $11 billion over the next year “to stave off a balance of payments crisis and a potential devaluation of its currency”, making any appeal to foreign investors all the more important to weathering the fiscal storm ahead.

While the active development of the country’s natural gas reserves would undoubtedly help alleviate some of that debt and ease the country’s domestic energy demand, it is far from clear whether foreign companies view Egypt as a safe bet. Lingering uncertainty about the county’s stability and ability to ensure a stop in attacks in the Sinai have continued to hinder interest as Cairo struggles to sell themselves as a reliable energy bet.

Image: Jafria News

Originally Posted at Newsbase’s Afroil Monitor. All rights reserved.

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Egyptian Energy Presses Ahead Despite Criticism

Despite extensive efforts, Egypt has struggled to get their economy back on track in the year since widespread public protests led to the ousting of long-standing president Hosni Mubarak. Political instability and uncertain investors have kept needed international funding at bay, as Cairo works to establish a solid foundation for the country’s first new government after decades of Mubarak leadership. The country’s coveted tourism sector remains weak and despite enormous reported potential, Egypt’s renewable industry has been slow to start as investors and international financing agencies adopt a ‘Wait-and-See’ attitude.

Still, despite the stagnate pace of growth and economic recovery, one sector of the country’s economy has continued to shows signs of life – Egypt’s oil and natural gas producers. According to United States National Public Radio report this week, the country’s General Petroleum Company, the government office charged with making final decisions on exploration and production agreements, has continued to add to the country’s 148 standing partnerships.

The continued rounds of licensing for both on and offshore efforts comes despite strong criticism aimed at how such efforts were carried out under the Mubarak government, with critics leveling complaints at a perceived lack of transparency about pricing and the amount of domestic reserves set aside for exporting.

The continued lack of transparency surrounding the natural gas deals has critics worried that even with Mubarak gone, the Egyptian government may still be allowing the kind of controversial agreements that led to a wave of protest earlier this year. The backlash came soon after an investigation uncovered payment agreements with Israel and Jordan for Egyptian natural gas that assured under-market prices in exchange for benefits for local government officials. While Jordan was quick to work out a renegotiated deal, contested trade agreements with Israel added to existing strain between new political leaders in Cairo and its eastern neighbor.  The situation was further complicated by a series of now 14 attacks on natural gas pipelines in the Sinai region of Egypt, halting exports again and again. Energy relations between the two countries showed little sign of improving after Cairo cancelled a 2005 export agreement with Israel, who currently depend on Egypt for 40 percent of their energy needs.

More than just lost revenues, the decision to cancel Egypt’s 20-year deal to supply natural gas to Israel is now resulting in a lawsuit filed by investors in the East Mediterranean Gas for violations of bi-lateral investment treaties, according to a Bloomberg report.

Despite such criticism, the government may have little choice than to support new production deals under the pressure of mounting debt and wavering interest from existing project partners. According to Australia’s The National, the Egyptian government has accrued about $4 billion in debt to international energy firms due in part to large-scale purchases to allow for heavily subsidized domestic sales. This comes despite the country’s own 78 trillion cubic feet of proven natural gas reserves. This debt has recently increased, according to the report, due to late payments as a result of the country’s recent political instability.

Further complicating the situation for the government and local partners, the country’s recent uncertainty and apparent high cost of operating in Egyptian territory has pushed some international firms to reassess their presence there. In November of last year, Royal Dutch Shell handed back an offshore block, stating that the high costs of operating there overshadowed the possible rate of return.

Still, many firms are looking past the country’s current predicament and ahead to a potentially calmer new year, including Houston’s Apache and the UK’s BP, who are hoping to capitalize on a 2010 offshore effort. In fact, it is the government’s willingness to pursue new deals despite the country’s current challenges that has Apache feeling confident about the months ahead.

“Our operation has continued [uninterrupted] and supported by government partners as evidenced by the issuance of new…leases,” Apache President and Chief Operating Officer Rodney Eichler said, according to a Dow Jones report. “We are optimistic for Apache’s future in Egypt.”

Given the financial limitations of the country’s current government, anything more than new licenses may be too much to hope for. Burdened by significant budget shortfalls, the Egyptian government will be unlikely to consider any price renegotiations with existing production partners, regardless of the additional risks now associated with operating in the country.

However, regardless of either company’s intentions or interests, existing deals could soon come under scrutiny should critics chose to build on the investigation that put a spotlight on the Israeli and Jordanian deals.

“Some terms that are now in question are part of the 2010 deal with BP for the extraction of deepwater Mediterranean gas,” reported NPR. “While many details of the deal have not been made public, it has many critics.”

A similar threat of agreement reviews has foreign partners on edge in Libya, where the country’s transitional government has pledged to take a closer look at those oil and gas agreements completed under Gadaffi.

Originally Published at Newsbase’s Afroil Report. All Rights Reserved.

Image: Modern Egypt.info

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Egyptian Energy Sees Some Return to Stability but Challenges Remain

In the months since the collapse of the long-standing government of Hosni Mubarak, Egypt has struggled to stabilize their energy sector amid widespread shortages and a seemingly endless series of attacks on vital transport lines. Despite the uncertainty these setbacks have provided, Egypt’s oil and gas industries have seen some progress, making a needed return to stability an achievable, if still difficult goal.

Egypt’s energy sector began experiencing delays almost as soon as public protests forced military attention away from the Sinai Peninsula and towards volatile city centers. The military exit allowed rebel groups in the region to mount a series of attacks on natural gas pipelines serving customers in Israel and Jordan, halting exports and much needed revenue for the Egyptian government. The natural gas sector received another setback as allegations emerged detailing below-market deals for Israeli and Jordanian customers in exchange for payments to Mubarak officials. Both counties have begun exploring import alternatives as rising tension and repeated shutdowns have made Egyptian natural gas unsustainable.

Making matters more difficult, Egypt has experienced two massive fuel shortages brought on by panicked purchasing amid reports that the government will soon slash fuel subsidies to help deal with a mounting budget deficit.  Currently, about two-thirds of Egypt’s total subsidies go towards fuel costs – an amount that is expected to increase 40 percent this year to reach $16 billion, according to the Council on Foreign Relations.

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However, despite the steady stream of bad news, many oil and gas actors in the country are making strides towards sustaining and even expanding operations in Egypt’s new political and economic environment.

According to Market Watch, Houston-based Apache announced a 3 percent increase in production in Egypt’s Western Desert, reaching 203,000 barrels of oil and 880 million cubic feet of gas per day thanks to the development of seven new leases in the Faghur Basin.

Last week, Ukrainian Minister of Energy and Coal Industry Yuriy Boiko announced the country’s intention to boost production efforts in Egypt with the signing of two concession agreements for the development and operation of oil and gas fields in the Wadi El Mahareeth and South Wadi El Mahareeth oil blocks in the Eastern Desert in Egypt, according to a government release.

Meanwhile, the PetroSinai joint venture, which operates on behalf of the Egyptian Petroleum Company and MENA, announced the successful re-entry in the Lagia 6 oil field. The move is a part of a proposed development plan that will include up to 55 wells aimed at developing the Lagia Development Lease. Australia’s Beach also recently announced their intention to expand their Egyptian footprint with the development of oil finds in the country.

Challenges Remain

However, further progress in Egypt, especially among larger energy investors, could be hampered by an ongoing struggle over hydrocarbon E&P authority, which is currently under the control of the country’s military. According to Lebanon’s Daily Star, a holdover system from the Mubarak government places the final authority over exploration and production efforts in hands of generals and “military permits” that dictate when, where and how projects move forward.

The existing system was at the center of a meeting held late last month between the country’s oil ministry and representatives of companies active or interested in Egyptian projects, including BP and Enap Sipetrol.

“Egypt is investor friendly, but army restrictions make the lives of people harder,” said Marwan al-Ashaal of Enap Sipetrol, according to The Daily Star.

The meeting saw company representatives call for an overhaul of what they saw as dated production sharing agreements in order to spur needed investment and foreign partnerships.

Revising such dated systems related to the country’s energy sector could be vital to ensuring public support, but will also require a demonstration of shared benefits to the general public, not just select government officials, remarked a UN official close to energy development in Egypt last week.

In an effort to cope with the loss of revenue from severed ties with Jordan and Israel, the Egyptian government has pushed for greater trade cooperation with Sudan. Originally built on an export agreement signed in October of last year, this effort now requires Egyptian officials to take on a diplomatic role in hopes of calming tensions between Sudan and South Sudan over the disputed Heglig oilfield.

As for the capital’s struggle to deal with the now 14 attacks on natural gas pipelines in the Sinai, the government has announced a series of military efforts, stepping up their presence in the region to combat rebel groups and even collaborating with Israeli troops to address rocket attacks across the two countries’ border. The dual effort is especially difficult, as public sentiment has turned against stronger ties with Israel due to the natural gas controversy and the rise of political leaders strongly opposed to diplomatic ties of any kind between the two countries.

Despite these efforts, this week saw another attack on an oil facility in the town of El-Arish, resulting in the death of two policemen and injuring a third, according to the Associated Press.

Image: CNN Money

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Egypt Seeks Pipeline Solutions but Little Official Support

As Egyptian security and political forces have sought ways to combat attacks in the Sinai Peninsula that have led to 13 pipeline delays since the fall of Hosni Mubarak last year, it has become clear that ensuring the transport line or finding ways to ensure existing deliveries may not be as important as once thought – at least in terms of trade with Israel.

This month saw the country’s People’s Assembly vote to cut off natural gas exports to Egypt’s neighbor in response to allegations that the outgoing Mubarak government had sold to Tel Aviv at under-market prices, angering a government body that has already expressed their intention to review and revise all existing relations with their neighbor.

The move comes following a months-long deterioration of the security situation in the Sinai region of the country attributed to Bedouin groups, which has included both attacks on the pipeline and a third case of kidnapping last week. While unlikely to signal a wider halt to energy exports, some analysts have pointed to the shutdowns and lack of political will as a signal of greater internal use of Egypt’s energy resources.

So far, according to an off the record comment from a state official, the attacks have caused upwards of $160 million in losses for the Egyptian government, according to the country’s Al-Ahram newspaper.

Opened in 2008, the pipeline in question was meant to provide for 20 to 25 percent of Israel’s energy needs, but the country has so far expressed little concern for the long-term consequences of a prolonged or complete halt in deliveries, pointing to the potential of offshore reserves to make up the difference. However, according to a USA Today report, the pipeline shutdown could do much to damage relations between the two countries.

Emerging as the unintended victim of both the attacks and the lack of Assembly support for the situation, Jordan has been left to find viable alternatives to the loss of imports. Recent shutdowns due to the now 13 attacks have resulted in widespread energy shortages. Even efforts to curb their dependence on the pipeline have resulted in spikes in costs as the country’s shifts away from natural gas towards electricity plants that use diesel or crude.

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Sinai Pipeline Safety Suffers As Egypt’s Nat Gas Sector Falls

A twelfth attack on natural gas pipelines linking Egypt with vital trade partners in Israel and Egypt has case a spotlight on growing instability in the eastern Sinai Peninsula and the ability for the new government to keep things under control.

Attributed to a new group called Ansar al-Jihad by Israeli media outlets, the most recent attack saw deliveries of natural gas to two of Egypt’s most important trade partners, threatening an economy already reeling from a collapse of the tourism sector. Governments in both Jordan and Israel have expressed their intention to seek out alternative fuel resources as the attacks highlight the limitations of the new government to address the impact of armed opposition groups in the region.

After earlier attacks on pipeline projects earlier last year, Cairo sent several thousand troops to the Sinai to combat these groups, but have been hindered by diplomatic restrictions and a lack of support from local residents.  Until recently, the Sinai Peninsula remained largely peaceful, but also mostly ignored by much of the Egyptian establishment in Cairo. Although the region represented the border between Egypt and Israel, Cairo’s military presence in the area was restricted according to the 1979 peace treaty between the two countries. Before sending in troops to help protect the pipelines, leaders in Cairo had to seek permission under the 1979 agreement. Further complicating their mission, the Sinai’s mostly Bedouin population has long expressed their discontent with the country’s leadership, offering a vacuum of influence in the region. While legislative solutions have been proposed to address the lack of support for the Sinai population in terms of economic and development guidance, short term solutions to ensuring regional and pipeline stability have only come in the form of additional troops.

The attacks reflect a broader growth of instability in the region, including an increase in kidnapping and incidents between local groups and the Egyptian military. This growing tension also serves to add pressure to diplomatic and trade relations between Israel and Egypt, which has seen public attacks on the Israeli embassy in Cairo as well as the country’s border area.

Image: MSNBC

 

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Aftershocks of the Revolution Pt. 2: LGBT Human Rights and Foreign Aid to MENA States

After coming across a Christian Science Monitor map displaying the treatment of LGBT citizens in each country in Africa earlier this week, I thought back to the speech recently delivered by U.S. Sec. of State Hillary Clinton. Delivered at the Palais des Nations, Geneva, Switzerland, the speech called for greater support for the human rights of LGBT citizens across the world and, in so many words, making it clear that State Department personnel would be advised to consider treatment of LGBT populations when making decisions about foreign support, including foreign aid. The message seemed clear – countries that tolerated or supported the abuse or lack of equal rights for LGBT citizens would run the risk of aid reviews and/or cancellations.

While we are still some time away from seeing just how the US State Department will follow up on Clinton’s speech, its worth exploring how closer attention to LGBT rights could impact much needed aid packages to countries emerging from the Arab Spring. This is especially relevant in countries that have seen more conservative parties make significant strides during recent elections, such as Egypt, Morocco and Tunisia. According the CSM summary, all countries in North Africa have policies of imprisonment from one to ten months for LGBT citizens. Further, every one of those countries receives some level of foreign aid from the United States, led by Egypt with $1.5 billion in support as of last year. According to the US government releases, Egypt is followed by Morocco with $43.6 m, Tunisia with $6.5 million, Algeria with $2.8 million and Libya with $1.6 million though that is likely to change after the country holds planned elections in the Spring.

There is little reason to believe that the US will base all or any of their attention on LGBT rights when making final aid decisions over the coming months given the weight of other factors in the region, including security and political stability. Furthermore, it may not even be advisable at this point to interfere in how foreign aid is spent at all so early in the process of building new governments, according to regional observers.

“The best thing is probably to just give the money to the governments and then encourage them to use it in ways that make sense and monitor it,” Frank Anderson, president of the Middle East Policy Council, told the International Business Times.”History has shown that there’s great sloppiness and opportunity for corruption when you give governments money, but attempting to manage the system ourselves has failed miserably in place after place after place.”

Still, given the timing of Clinton’s speech, it is worth being aware of the elevated status of the issue as countries across the region struggle to find a new political and social balance and what, if any, role does the State Department intend to play in that process.

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