Feb. 20 (Bloomberg) -- The U.S. should direct $150 million in economic aid to Egypt because the U.S. ally’s economy “is in the tank,” Senator Richard Lugar said today on CNN’s “State of the Union” program.
The Indiana Senator, top Republican on the Foreign Relations Committee, said the U.S. should concentrate on providing financial help to Egypt instead of providing advice on how to best build a democratic system.
“Our assistance here may be the most influential thing we can do,” he said. The “Egyptian economy is in the tank,” with the tourism industry “demolished” and wheat and corn prices affecting whether the country can feed its people, he said.
Secretary of State Hillary Clinton on Feb. 17 said the Democratic Obama Administration is preparing a $150 million aid package to help Egypt recover after the revolt that ousted President Hosni Mubarak.
Unrest in Egypt has cost the nation about $1.5 billion in tourism revenue, according to Central Bank Governor Farouk El-Okdah. It has forced companies to close and sent the currency to a six-year low. Before Mubarak’s resignation, the benchmark EGX30 Index tumbled 16 percent in one week.
Egypt, which has a peace treaty with Israel, is the one of the closest U.S. allies in the Mideast and the fourth largest recipient of U.S. aid for the fiscal year 2011, according to State Department figures.
The State Department’s 2012 budget proposal, released Feb. 14, preserves $1.5 billion in assistance to Egypt, with nearly 87 percent directed to the military. Representative Ileana Ros-Lehtinen, the Florida Republican who heads the House Committee on Foreign Affairs and who is backing cuts to the State Department budget request, has said the agency mishandled prior aid funding to Egypt.
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