The war between Israel and Hamas has thrust Egypt’s role as a regional power broker into the spotlight and threatens to win Western support as the country tries to emerge from a dire economic crisis.
Egypt has long-standing ties with Israel and shares a border with Gaza, and its position is emerging as key to determining the fate of the refugees and continued efforts to support the besieged area’s 2 million residents after Israel cut off vital supplies due to deadly Hamas attacks. key to providing assistance. Attacked on October 7th.
That presents opportunities for the most populous Arab country as it grapples with its worst economic outlook in decades and President Abdel-Fattah el-Sisi braces for new challenges . The election is less than two months away. However, a number of domestic and regional considerations are thought to preclude any refugee deal.
The Israeli government has held talks with counterparts in multiple countries about Egypt temporarily housing Palestinians fleeing violence in Gaza, according to officials familiar with the matter. Israel has suggested moving them to tent camps in the Sinai Peninsula funded by the United Nations and the United States and then returning after the military operation ends, people familiar with the matter said. It was unclear whether Israel proposed the idea directly to Egypt.
“Clearly, the Israeli and American sides want Egypt to accept economic incentives to allow Gazans into Egypt at a time when it is suffering from an economic crisis,” said Miret Mabrouk, director of the Egypt Program in Washington, D.C., headquartered at the Middle East Institute.
However, “few voters oppose decades of policies that have not allowed Palestinians to be displaced,” she said, and those incentives “could end up being a political liability, especially in an election year.”
Still, at this month’s annual meetings of the International Monetary Fund and World Bank in Morocco, Bloomberg News spoke with multiple economists, bankers and investors who believe Egypt may receive some economic support regardless of its refugee stance how. The crisis has reminded global players of the North African country’s status as a key player in the region, reinforcing the notion that the country is too big to fail.
People familiar with the matter told Bloomberg this month that Egypt reached an agreement with the International Monetary Fund in December and is currently negotiating to increase its bailout package from $3 billion to more than $5 billion.
The IMF’s main shareholders in the United States and Europe are likely to pressure the Washington-based bank to relax its requirements and move forward with the plan, despite objections from Cairo. The pace of reform is slowsaid Riccardo Fabiani, Crisis Group’s North Africa program director.
This is also because the current conflict highlights the growing instability among parties in Egypt, Libya, Sudan and now Gaza. Fabiani said the United States and Europe need to ensure that “Cairo remains a stable and reliable partner in the region” and “deserves external support.”
There is evidence that Sisi hosted an alleged international conference on Saturday Cairo “Peace Summit”Middle Eastern and European leaders attended.
diplomatic onslaught
The recent flurry of diplomatic activity centered in Cairo marks a return to Egypt’s traditional role, which figured prominently in every discussion of power politics in the region in the second half of the 20th century.
It rallied Arab armies and led the 1973 attack on Israel, triggering the Yom Kippur War, before the two countries signed a peace treaty and established full diplomatic relations in 1980, becoming strategic allies.
Sisi has been courted by many world leaders since Hamas, designated a terrorist group by the United States and Europe, launched an attack on Israel. US President Joe Biden reiterated the two countries’ “enduring strategic partnership” in a phone call. Visiting German Chancellor Olaf Scholz praised the solidarity between Germany and Egypt in preventing a “conflagration” in the Middle East. Chinese President Xi Jinping met with Egyptian Prime Minister Mustafa Madbouly in Beijing.
Robert Satloff, executive director of the Washington Institute for Near East Policy, said the war “underscores the important role Egypt has always played in security issues in Gaza and surrounding areas.”
European governments also recognized Egypt’s importance as a regional natural gas producer after Putin invaded Ukraine last year. European officials are visiting Egypt to assess Egypt’s potential as a natural gas supplier – with help from Israel – to replace at least some of Russia’s supplies.
These governments are now looking to Sisi for help in relieving pressure on Gaza. But he rejected any suggestions from Egypt to take in Gaza refugees and suggested that Israel should admit Palestinians to the Negev desert. “They can transport Palestinians there until Israel implements its announced plan to destroy Hamas,” he said on Wednesday.
Egypt already hosts about 9 million refugees and other immigrants from countries including Syria, Sudan, Yemen and Libya. Opening a route for the Palestinians could also create new security risks in the Sinai Peninsula, where troops have just successfully reined in fighting with Islamist militants.
Jordan has also refused to accept more Palestinians, and Egypt is unlikely to become an exception in the region and take in refugees who many suspect may never be returned to Gaza. This could be seen by the Arab world as fueling another mass displacement and betraying the Palestinian cause, which all Arab states pay lip service to.
Furthermore, the Washington Institute’s Satloff said that while Egypt could absorb a certain number of people, the domestic political consequences would be “huge.” “The political leadership sees this as a red line that cannot be crossed and would rather face worsening financial difficulties than accept large numbers of refugees.”
There is precedent for Cairo winning favors when regional war breaks out.
In 1991, Egypt received a forgiveness of half of $20.2 billion in debt owed by the United States and its allies—one of the most generous debt relief episodes by a creditor nation—in exchange for support for the anti-Iraq coalition during the Gulf War.
The United States wants to reward Egyptian President Hosni Mubarak for his key role in uniting Arab nations against Saddam Hussein and compensate Egypt for the heavy economic losses it suffered during the war. Egypt also sent its armed forces to participate.
However, replicating this would be difficult. It was widely believed at the time that support was needed now that Kuwait had been invaded, and Egypt’s involvement “did not create any great popularity among military circles, but it was not a particularly hard sell, and debt relief brought Huge benefits”. said Mabrouk of the Middle East Institute.
That is not the case today, especially since Egypt’s commitments are not comparable to the burden in 1991, when Egypt was the second-largest source of manpower for the U.S.-led coalition, so it cannot expect similar levels of economic aid, Satloff said .
way out
Strategists say one way out of the predicament could be for Egypt to offer Saudi Arabia a co-leadership role on the Palestinian issue in the Arab world in exchange for financial support. Crown Prince Mohammed bin Salman, aware of domestic anger against Israel, is likely to welcome such a move to bolster his regional image, despite his absence from Saturday’s summit.
Crisis Group’s Fabiani said the instability may provide Egypt with other opportunities to play a mediating role that could pay off.
He said that Egypt will now strive to play a constructive role, “hoping that its contribution will be recognized by international and regional partners and may receive economic rewards.”
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