The Cable

Egyptian Embassy: We fired our Washington lobbyists for budgetary reasons

It was the Egyptian government that terminated its lobbyists in Washington, a senior official at the Egyptian embassy in Washington told The Cable Monday, not the other way around, as those lobbyists are claiming.

On Saturday, The Cable reported that the Livingston Group, run by former Rep. Bob Livingston (R-LA), the Moffett Group, run by former Rep. Toby Moffett (D-CT), and the Podesta Group, run by Tony Podesta, had unanimously severed their combined $90,000 per month contract with the Egyptian government. The three firms had formed an entity known as the PLM Group, which had received more than $4 million from the Egyptian government since 2007. The trio came under fire last week for circulating talking points defending Egypt's Dec. 29 raid of several NGOs working to train political parties in Egypt, including three organizations partially funded by the U.S. government -- a dispute that has escalated to include barring NGO workers from leaving Egypt, including Transportation Secretary Ray LaHood's son Sam LaHood, the head of the International Republican Institute's Cairo office.

"We handed the principals of the group the letter of termination. We were surprised by some of the statements made on their behalf," the Egyptian embassy official told The Cable. "We are under instructions from Cairo to try to cut costs, taking into account the economic crisis we are facing in Egypt."

"One of the things that they have instructed us to do is to cut our embassy budget and they specifically instructed us to cut the budget by cancelling the contract with PLM, and we did that in accordance with the contract itself."

Sources at the PLM Group said that they had warned the Egyptians earlier in the month that if the NGO situation wasn't resolved, they would have no choice but to drop Egypt as a client. Late last week, the three principals met with the Egyptian ambassador, who swiftly handed them a letter of termination, the sources said.

"That's not true," the Egyptian embassy official countered. "There was no ultimatum that was given to us by PLM that would terminate their contract with us."

So will the Egyptian government now hire new lobbyists? Not right away.

"This is something for the headquarters to instruct us with, so we're waiting and hopefully we'll get instructions soon whether to go ahead with hiring someone else or not. That also depends on the transition itself... so there will be a new approach, we think, to things like that," the official said, referring to the ongoing political process in Egypt.

The official also confirmed that a high-ranking Egyptian military delegation is coming to Washington later this week to meet with senior U.S. officials and lawmakers. That delegation is in Tampa, Florida, now, meeting with officials at U.S. Central Command, and will arrive in D.C. on Wednesday -- without their lobbyists at their side.

That delegation was pre-scheduled and focused on military-to-military cooperation, the embassy official said. The Egyptian military receives $1.3 billion annually from the U.S. government, aid that is now under new scrutiny due to the military's role in the NGO raids.

"They are coming to discuss military issues; this is a periodic delegation that meets with their counterparts to discuss issues of mutual interest," the official said. "It's not related to the NGO issue."

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