(Adds details of EU position, paragraph 4) By Jonathan Wright CAIRO, March 7 (Reuters) - A policy plan signed by Egypt and the European Union, worth 558 million euros ($733 million) to Egypt over four years, has much more carrot than stick when it comes to politics and human rights, experts said on Wednesday. Political analysts and politicians said they doubted the European Union (EU) would ever threaten to withhold any of the aid money to punish the Egyptian government for any abuses. "The aim is not to penalise but rather to encourage. The European approach will be very patient, very incremental and very supportive," said a diplomat who asked not to be named. The Europan diplomat said the money was already allocated to sectors and programmes agreed by the two sides and the Europeans had no intention of linking it to performance benchmarks. "The European Union waves a carrot and not a big stick. There is positive conditionality in that countries that move faster will gain extra incentives," he added. The European approach has irritated some Egyptian liberals, who saw the government concede more freedoms when the United States campaigned for political change in 2004 and 2005. The agreement, signed in Brussels on Tuesday and known as a joint action plan under the EU's Neighbourhood Policy, sets out common objectives broadly designed to help the Egyptian government modernise and liberalise the country. The political objectives include encouraging participation in political life, European help with aspects of elections, strengthening civil society, ensuring the independence of the judiciary and promoting human rights and basic freedoms. But Egyptian Foreign Minister Ahmed Aboul Gheit told the signing ceremony on Tuesday that any political changes in Egypt would be based on Egyptian decisions. "Whether it is the suggested amendments to the constitution, or changes in the Egyptian laws and legal system and the modernisation of the judiciary ... Egypt will do it according to its own pace and according to whatever results Egypt desires," he said. REDUCED SAFEGUARDS The ruling party of President Hosni Mubarak, through its dominance of parliament, is pushing through constitutional changes which make it harder for the main opposition group to win elected office and reduce the safeguards for fair elections. Gameela Ismail, spokeswoman for the opposition Ghad Party and the wife of imprisoned liberal politician Ayman Nour, said the European Union's position on human rights was "very frustrating" because despite well-intentioned words she saw little European interest in following up on Egyptian cases. "They know what is happening very well. They have a big file on human rights violations and democracy repression. But Aboul Gheit is such a magician that he seems to have put them to sleep when he went to Brussels," she told Reuters. Hassan Nafaa, a professor of political science at Cairo University, said the European Union had set a pattern for the future by failing to set any political conditions for signing the agreement in the first place. "The European Union always uses these agreements for public relations to prove it is committed to human rights and so on, but once it comes to real implementation it has always been written in vague terms," he added. The EU approach is much the same as that of the United States, which campaigned for political reform in Egypt in 2005 but has since lost interest, he said. "In the end the defence of interests also prevails over the defence of values," he added. Walid Kazziha, who teaches politics at the American University in Cairo, said: "The pattern the Europeans have adopted over the years is that they do not use their economic aid for political purposes. I don't think we will see them embarking on that." Issandr El Amrani, an independent political consultant, said the aim of the agreement was to provide a mechanism to cooperate on political reform if conditions are right in Egypt. "But the conditions will not be right for some years," he said. It would take a major upheaval, such as a presidential succession which is not legitimised through elections, to throw the European aid package off track, he added.
