US embassy cable - 05CAIRO6211

UNCLAS SECTION 01 OF 02 CAIRO 006211 
 
SIPDIS 
 
SENSITIVE 
 
FOR MEPI/TUNIS AND NEA/PI 
 
E.O. 12958: N/A 
TAGS: KDEM, PGOV, EG, MEPI 
SUBJECT: AN UPDATE ON MEPI FUNDING IN EGYPT: REGIONAL 
DIRECTOR PETER MULREAN'S VISIT, JULY 16-20 
 
 
Sensitive but unclassified.  Please protect accordingly. 
 
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Summary 
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1.  (SBU)  On July 16-20, MEPI Regional Director Peter 
Mulrean visited Alexandria and Cairo to meet with current and 
prospective MEPI grantees.  In Cairo, two of the five Civil 
Society (CS) grantees described difficulty in obtaining 
approval from Egypt's Ministry of Insurance and Social 
Affairs (MISA) to receive MEPI funding; and the Ibn Khaldun 
Center, another CS grantee, had still not received its first 
tranche of funding from Washington.  However, that a number 
of other grantees are already operating successfully is 
evidence that the continued fine-tuning of the MEPI grant 
management process, along with frequent visits to grantees by 
MEPI staff, is gradually helping to improve the MEPI image in 
Egypt.  End summary. 
 
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Alexandria 
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2.  (SBU) In Alexandria, Mulrean finalized small MEPI grants 
for the Egypt Cognitive Center and Creative Child (ECC) 
($13,300); the Future Businesswomen's Association (FBA) 
($24,830); and the Sustainable Development Association (SDA) 
($25,500).  These organizations did not expect problems in 
receiving MEPI funding or in project implementation, and each 
expressed willingness to publicize MEPI funding as part of 
their projects.  ECC's project focuses on educational reform 
and developing alternatives to mandatory private lessons in 
Egypt's public education system; FBA's activities focus on 
women's participation in local governance; and SDA will 
conduct two model U.N. programs and produce video educational 
materials on its activities. 
 
3.  (SBU) Mulrean also met with Alexandria Bibliotheca 
Director Ismail Serageldin and special advisor Bernard Salome 
to discuss potential for cooperation between the library and 
MEPI.  They discussed the Bibliotheca's $3.5 million USAID 
proposal for support of the Arab Reform Forum and the Arab 
InfoMall, designed as an online forum for civil society 
organizations to communicate with, and provide support to, 
one another.  (Comment: It is too early to tell whether the 
Bibliotheca's proposed activities might be better funded 
under a MEPI grant.  End comment.) 
 
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Cairo Civil Society Grants 
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4.  (SBU) In Cairo, Mulrean met with the five civil society 
MEPI grantees, three of which are currently experiencing 
problems in receiving funding.  Ibn Khaldun Center (IKC) 
funding had been delayed because required materials for IKC 
to request a drawdown of funds from Washington had not yet 
arrived.  (By August 3, however, NEA/PI reported that IKC had 
received $40,000 in funding after a July 28 wire transfer.) 
Additionally, both the Egyptian Association for the Support 
of Democracy (EASD) and Egyptian Association for Developing 
and Disseminating Legal Awareness (EADDLA) are awaiting MISA 
approval to receive funding.  The legally-mandated 60-day 
waiting period for receiving MISA permission to begin 
activities has expired without MISA comment.  (Note:  The 
Embassy will proceed to inform MISA that the U.S. 
Government's interpretation of the NGO Law is that expiration 
of the waiting period absent a MISA response constitutes 
approval to receive MEPI funding.  End note.) 
 
5.  (SBU) New Horizon Association for Social Development (NH) 
and United Group (UG) are proceeding with implementation of 
their projects.  Nady Kamel, Chief of Trustees, discussed 
NH's Empowering Youth in Old Cairo project, which involves 
educating 1000 youth on political participation.  NH has 
received permission from MISA to withdraw MEPI funds.  Negad 
El Borai, head of the UG, described having a positive overall 
reaction to UG's activities from the public, political 
parties, and the media following the initial negative press 
following the launching of MEPI civil society projects. 
(Comment:  UG has the status of a civil company, not an NGO; 
therefore, legally, it does not require MISA permission to 
receive MEPI funding.  UG's activities may be the most 
political of the MEPI civil society grantees' projects 
because they are focused on legal and technical training of 
political party members and because UG's effective management 
and well-developed programs have a history of effectiveness. 
End Comment.) 
 
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Standing Program Announcement (SPA) Grantees 
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6.  (SBU) Mulrean met with Egyptian NGO Service Center 
(ENGOSC)/South East Consortium for International Development 
(SECID) and Center for Development and Population Activities 
(CEDPA), both MEPI SPA grantees. Shareef Ghoneim, ENGOSC CEO 
and Nihad Rageh, New Initiative for Leadership in Egypt 
(NILE) Project Director reported that the NILE project was 
progressing as scheduled.  In Alexandria, Mulrean observed a 
CEDPA training session on election monitoring and evaluating 
for representatives from the CEDPA NGO network and the 
National Council for Women's Rights.  In Cairo, CEDPA 
Director Amel Gamalin said the organization was very pleased 
with progress, noting that three of the four governorates 
involved were highly supportive.  Implementation in Beni 
Suef, however, is proceeding slowly, partly due to a lack of 
strong leadership and rivalries among different parties. 
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Media Outreach 
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7.  (SBU) Mulrean also participated in media roundtables in 
Alexandria and Cairo each involving a dozen journalists from 
various Egyptian newspapers and international news services. 
Mulrean provided an overview of MEPI activities in Egypt and 
countered misinformation about MEPI civil society grants and 
NDI's ongoing activities.  Mulrean also gave a 20-minute 
radio interview to the Egyptian National Radio English 
program.  PAO also issued a press release on behalf of MEPI 
and CEDPA announcing the CEDPA-sponsored Alexandria training 
session. 
 
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Plans to Audit the Civil Society Grantees 
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8.  (SBU) Mulrean relayed to each of the Civil Society 
grantees MEPI's decision to audit their use of funds, to 
ensure fiscal responsibility of these more politically 
sensitive grants.  All grantees agreed to participate. 
Embassy Cairo has received estimates from Egypt-based 
American auditing firms and in the meantime has made a 
preliminary inspection of the United Group's financial 
records. 
 
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Comment 
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9.  (SBU)  While media outreach efforts to counter 
misinformation about MEPI civil society grants have been 
partially successful, MEPI's ongoing challenges in Egypt are 
to explain itself to a general population largely ignorant of 
MEPI programs and to an educated class having great 
difficulty in differentiating between MEPI funding and other 
U.S. programs, including USAID assistance, and the 
Ambassador's Self-Help Fund.  MISA's lengthy delays in 
approving the funding and activities of several programs is 
evidence of this attitude.  Bureaucratic and technical 
delays, perhaps complicated by the necessary requirement to 
base fund transfers to grantees on successful auditing 
reviews, have not played well with local MEPI supporters. 
However, that a number of grantees either expect no hurdles 
or are already operating successfully -- even in the 
politically sensitive environment of the pending September 7 
presidential elections -- is evidence that continued 
fine-tuning of the MEPI grant management process, along with 
frequent visits to grantees by MEPI staff, is gradually 
helping improve MEPI's image in Egypt.  End comment. 
 
 
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JONES