Middle East Politics & Diplomacy The Gulf

MENASource

June 28, 2022

Egypt is cozying up to Russia. It’s time for the US to step in.

By Shahira Amin

In June, Russia’s state-owned atomic energy firm, Rosatom, made a surprise announcement that it would begin producing equipment for Egypt’s first nuclear power plant in the northwest town of El-Dabaa. The new development has raised concerns in the United States and Europe -which harbor resentment toward Russia for its aggression against Ukraine and see the continuation of the project as a sign of Egypt cozying up to Moscow.

The announcement, which came during a visit to Moscow by the head of Egypt’s Nuclear Power Plants Authority, marks a revival of an agreement signed by Egypt and Russia in 2015 and has seen little progress since. The decision to resume work on the controversial Dabaa civilian nuclear facility has also raised some skeptical eyebrows among observers in the US and Europe.

For one, Russia—which has committed to financing 85 percent of the cost of the Dabaa project through a $25 billion loan over a twenty-two-year period—is engaged in the war in Ukraine that has led to the imposition of punitive, multilateral economic sanctions.    

Egypt, meanwhile, has no pressing need for a nuclear facility, analysts argue.   The North African country has an energy surplus thanks to growing investments in renewable energy and large oil and gas discoveries made in recent years. Production from Zohr—one of the largest gas fields in the Mediterranean (discovered by Italian energy firm Eni in 2015)—reached a record 2.74 billion cubic feet of gas per day in 2021. The addition of two new wells to the gas field is expected to further boost production in the coming months. Moreover, a $10 billion solar power facility is under construction in the southern city of Aswan, with the potential to produce the same amount of energy as Dabaa (at just one-third of the latter’s cost). This renders the Aswan facility far more cost-effective and without the potential environmental risks posed by the Dabaa facility.

Egyptian officials insist, however, that the country’s future energy security—and population growth—necessitate diversification of energy sources, including nuclear and coal.

They see the construction of the Dabaa facility as a means of catalyzing the country’s shift to a low-carbon economy: nuclear energy is low-carbon and can supply the Arab World’s most populous country with clean, reliable, and affordable electricity, one security official told me. Egypt’s Integrated Energy Strategy aims to raise power production from renewable sources to more than 40 percent by 2035. Not surprisingly, the project is being touted in Egyptian media as one that would improve the living standards of Egyptians. The project also aligns with Egypt’s ambition to become a regional energy hub for Africa, the Mediterranean Sea, and the Middle East. Toward that end, Egypt has been implementing fiscal reform and constructing energy interconnections (besides its marked shift toward renewable energy resource development.)

Meanwhile, the Russian war in Ukraine and subsequent push by the US and its European allies to abandon the use of Russian fossil fuels, offers an opportunity for Egypt to step in and plug the gap in gas supplies to Europe through increased production and exports. Agreements have already been signed by Eni and the Egyptian Natural Gas Holding Company, EGAS, for Egypt to provide Europe—Italy in particular—with 3 billion cubic meters of liquified natural gas in 2022.  

Seeing a solid partner in Russia and grateful to the latter for its support, Egypt has refused to cave in to pressure from US and European allies to blatantly condemn the Russian war in Ukraine. Egypt has instead chosen to remain neutral in the conflict and has rejected the idea of imposing sanctions on Russia despite the fact that the country, too, is suffering from the implications of the ongoing war. Egypt—the bulk of whose wheat imports had come from Russia and Ukraine before the war—is now having to turn to alternative wheat import sources like Romania, France, and India, and is also paying a lot more for its imports. As Egypt grapples with a growing budget deficit and a shortage in foreign currency reserves, the country is paying up to $480 per ton for imported wheat—an approximately 78 percent increase over the original price ($270) paid before the war.

Addressing the International Economic Forum held in St. Petersburg on June 15-18, President Abdel Fattah al-Sisi praised Egypt’s “distinguished” relations with Russia. He noted that the two countries were implementing “large” and “ambitious” projects, citing the Dabaa facility as one such project. Russia is also enhancing its cooperation with Egypt by establishing a Russian industrial zone in the Suez Canal, which is expected to attract $7 billion in investments and is also helping develop Egypt’s dilapidated rail network. 

The two countries have enjoyed close relations for decades, but ties have grown stronger since President Sisi came to power in 2014. Irked by criticism from the US and European leaders in regard to “grave” human rights abuses committed by his regime, Sisi has sought to diversify Egypt’s global partnerships by cementing ties with his Russian counterpart—an autocrat unconcerned with democracy and human rights.  

Sisi, meanwhile, continues to be wary of the US, since the latter threw its weight behind the pro-democracy activists that led the 2011 uprising against dictator Hosni Mubarak, and was later willing to give democracy a chance by acquiescing to Muslim Brotherhood rule. The US went further, suspending in 2013 a portion of the $1.3 billion it annually gives to Egypt over “the bloody crackdown on the Muslim Brotherhood,” according to a CNN report.  Although the US released the suspended aid in 2015, the suspension had already caused a strain in US-Egypt relations. 

In September 2021, the US State Department announced plans by the Joe Biden administration to withhold $130 million worth of military aid to Egypt until the latter “takes specific steps related to human rights.” The Egyptian Foreign Ministry has repeatedly characterized allegations of human rights violations as “interference in the country’s internal affairs” and misinformation spread by the opposition.

If the US wishes to bolster its cooperation with Egypt, it may need to do what the European Union (EU) has done: water down its criticism of Egypt’s human rights situation and look out for its interests. So long as Sisi halts the flow of illegal migration from the Middle East and North Africa (MENA) region to Europe and continues his counter-terrorism efforts, the EU is willing to turn a blind eye to any excesses and bolster the Egyptian military’s arsenal through increased European arms sales to Egypt (notably from Germany and France.) This unspoken agreement has prompted Egypt to sign a long-delayed partnership deal with the EU to be implemented over the next five years. Priorities of the new partnership include helping Egypt build a sustainable and resilient economy through green and digital transition, energy, rural development, and supporting the country in tackling its food security challenge.

That isn’t to say that the US and EU should disregard their core values of respect for human rights, equality, freedom, and democracy. Rather, the West should continue to press for political reforms through enhanced support and greater cooperation to build mutual trust.  

In his address to the St. Petersburg Forum, Sisi acknowledged that Egypt is feeling the pinch of the global economic crisis and called for “a collaborative effort from all parties to address the crisis. ”

The US would do well to heed the call by continuing to extend support to its North African ally in this time of economic upheaval and uncertainty. The Biden administration has made no secret of its plan to withdraw from—or at least downsize the US footprint— in the Middle East. The decision has left countries in the region feeling vulnerable—abandoned even—as their leaders had looked to the US for support during the lingering effects of the COVID-19 pandemic, food shortages, and the impact of climate change, to name a few.

It isn’t surprising that Russia would step in to regain its position in MENA and fill a potential vacuum created by the US disengaging from the region and shifting its focus to the Russian war and China. As Egypt continues its war against terrorism in the Sinai and struggles to lift its economy from imminent recession, the US needs to reconsider its policy vis-a-vis  MENA—in particular, Egypt, whose stability is key for the stability of the region.

Supporting Egypt is a win-win, as it would guarantee that the US has a reliable partner to work with, especially when conflicts arise in the region. Egypt has, on several occasions, proved its mettle as a  mediator between Israel and the Palestinians. Such support would also ensure Cairo’s commitment to continuing the economic and political reforms it has started which are in the interests of both the US and Egypt. Now is the time for the US to cooperate more with Egypt, not less. 

 Shahira Amin is an independent journalist based in Cairo. A former contributor to CNN’s Inside Africa, Amin has been covering the development in post-revolution Egypt for several outlets including Index on Censorship and Al-Monitor. Follow her on Twitter @sherryamin13.

Further reading

Image: Egypt's President Abdel Fattah el-Sisi speaks with Russia's President Vladimir Putin during the first plenary session as part of the 2019 Russia-Africa Summit at the Sirius Park of Science and Art in Sochi, Russia, October 24, 2019. Sergei Chirikov/Pool via REUTERS