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MENASource April 20, 2021

Lessons from Israel and Egypt’s lukewarm peace

By Gabriel Mitchell

On March 9, Israeli Intelligence Minister Eli Cohen met with his Egyptian counterpart Nasser Fahmi in the resort town of Sharm El-Sheikh, located at the southernmost tip of the Sinai Peninsula.

On the face of it, nothing about this encounter was consequential—security cooperation is the bedrock of Israeli-Egyptian relations.

However, what captured Israeli headlines was the fact that Cohen was reportedly accompanied by a large delegation of Israeli businessmen. Could the recently signed normalization agreements with the United Arab Emirates, Bahrain, Sudan, and Morocco be warming the “cold peace” between Israel and Egypt?

Possibly, as it is hard to argue that there has ever been a better period in Israeli-Egyptian relations.

Since President Abdel Fattah al-Sisi came to power in 2013, security cooperation between Jerusalem and Cairo has reached unprecedented levels. The two countries share common goals in containing Iranian regional influence, countering Islamic radicalism, and maintaining peace in the Sinai Peninsula and Gaza Strip. Their 170-mile border—for decades a lawless frontier and hotbed for illicit trafficking and terror activities—now stands quiet. Understanding the need for flexibility in the post-2011 Arab Spring Middle East, Israel regularly permits Egyptian forces to enter Sinai’s demilitarized zones in numbers that exceed what was originally permitted in the 1979 peace treaty. There are similar reports of Egypt allowing cross-border operations by the Israel Defense Forces.

Nevertheless, security coordination has always been the relationship’s epicenter. So, while the depth of cooperation between Israeli and Egyptian forces is laudable, where is the relationship evolving?

Few examples are more demonstrative of that point than Israeli-Egyptian energy cooperation. In the early 2010s, when offshore hydrocarbons were discovered in the Eastern Mediterranean, it was not assumed that Jerusalem and Cairo would buddy up. For years, Egypt supplied Israel with natural gas, but the collapse of their arrangement in 2012 resulted in an unpleasant international arbitration process. In 2015, the International Chamber of Commerce ordered Egypt to pay $1.8 billion in compensation to the Israel Electric Corporation.

This could have been the death knell for future Israeli-Egyptian energy cooperation, yet both governments agreed that the commercial and geopolitical gains outweighed what Cairo owed. Israel’s natural gas reserves were trapped without an export route and Egypt’s dormant liquid natural gas facilities in Idku and Damietta were an ideal destination. The Eastern Mediterranean had become a breeding ground for maritime disputes—particularly with Turkey—and great power intervention, demanding more teamwork between friendly states. In 2018, an accord to deliver Israel’s gas to Egypt was signed to the tune of $15 billion. Then, a few months later, the parties reached a $500 million settlement on their old dispute.

Today, Israel and Egypt’s budding energy partnership is the foundation for the Eastern Mediterranean Gas Forum (EMGF), an international organization committed to advancing  energy development and cooperation opportunities between Eastern Mediterranean states. Based in Cairo and including Cyprus, France, Greece, Israel, Italy, Jordan, and the Palestinian Authority, Egypt sees the EMGF as a vehicle to establish itself as a regional gas hub, which would create jobs, improve Egyptian energy security, and strengthen its geostrategic position. For Israel, membership in a forum with three Arab actors and four European actors is no small accomplishment.

Unsurprisingly, Egyptian Petroleum Minister Tarek El Molla and Israeli Energy Minister Yuval Steinitz are among the most recognizable and well-traveled politicians in the Eastern Mediterranean. In late February 2021, El Molla was the first Egyptian minister to visit Israel in the last five years. Their personal rapport is viewed as one of the linchpins of bilateral ties.

Security and energy cooperation has also borne diplomatic fruit. After repeatedly downgrading diplomatic ties during various low points of the Israeli-Palestinian conflict, Egypt has maintained its ambassador to Tel Aviv since 2008. Israel’s new ambassador to Egypt, Amira Oron, is fluent in Arabic and has a personal bond with Egypt’s vibrant Jewish past. In 2018, Egypt asked Israel to mediate its dispute with Ethiopia over the Grand Ethiopian Renaissance Dam. Those efforts fell short but presented an opportunity for Israel to offer technology to help mitigate Egypt’s water security challenges upon the dam’s completion.

There are other examples of improving Israeli-Egyptian relations. For years, the route between Tel Aviv and Cairo was flown by Air Sinai—a one-plane airline that did not even bear the Egyptian flag—and not EgyptAir. However, in March 2021, it was announced that EgyptAir would fly the route under its name and triple the number of daily flights. Egypt has also restored multiple Jewish sites in Cairo and Alexandria. The gesture mirrors a trend amongst several Middle Eastern regimes who have tried to alter the perception of their attitudes towards Jews in an effort to court Washington. This message is not lost on Israelis. Anecdotal as these stories are, in concert, they reflect a larger shift taking place at the official level.

In comparison to his predecessors, President Sisi’s stance towards Israel is pioneering. However, there are also clear limitations to Israeli-Egyptian growth.

The Egyptian public has been consistently opposed to normalization with Israel and that position is unlikely to change until the Israeli-Palestinian conflict is resolved. Even civilians, like Egyptian actor Mohamed Ramadan, are castigated by the press if seen socializing with Israelis. As a result, high-profile meetings with Israeli officials—like the one with Cohen’s business delegation in March—continue to be censored for fear of public reprisal. These contradictions aren’t exclusively Egyptian. According to reports, the Israeli delegation was organized without prior consultation with the Economy and Trade Minister and Ambassador Oron.

This shouldn’t prevent Israeli and Egyptian officials from thinking creatively about the future of their relationship.

Israel and Egypt should invest more in maritime cooperation. In 2021 alone, a leak aboard a vessel reportedly smuggling Iranian oil to Syria polluted the Israeli coast with tar, and the Ever Given—a massive container ship—was stranded on the Suez Canal, backing up international commercial traffic for days, if not weeks. While neither incident was a bilateral issue per se, they both highlighted areas where enhanced communication—on monitoring maritime traffic, environmental protection, and naval security—could pay dividends.

For the foreseeable future, Israel and Egypt will continue their security coordination on matters pertaining to Hamas—the Islamist movement within Palestinian politics—and the Gaza Strip. But this should also include efforts to alter the economic circumstances that enable Hamas’ grip on power. Egypt’s recent decision to help develop the Gaza Marine natural gas field is exactly the kind of project that could meaningfully improve the living conditions of Palestinians. Expanding the Qualifying Industrial Zones program first introduced by US Congress during the Oslo Peace Process is also an area worthy of review.

Across the region, there is rising demand for technology that will increase human security and food security. Egypt should find ways of bringing Israeli tech into the economy in order to enhance the quality and quantity of its annual harvest. Investment in desalination technology would increase public access to clean water. In a country that has more than once rioted over the price of bread, diversifying Egyptian cooperation with Israel could be the difference between stability and chaos.

Advancing Israeli-Palestinian peace is not high on today’s agenda. Despite years mediating between rival Palestinian factions, Egypt appears fairly disinterested in the upcoming elections. Still, Jerusalem and Cairo will never be able to completely decouple their relationship from the Israeli-Palestinian conflict and therefore must continue working together to prevent future rounds of violence and the deterioration of the status quo. A disturbance to this delicate balance—for example, renewed Israeli interest in annexing portions of the West Bank—could scuttle the progress of the last six years.

Normalization demonstrated the fluid nature of Israel’s relationship with Arab states, however, methods that work with one country shouldn’t be expected to work everywhere. In Egypt’s case, the strategy is clear: keep expectations low and prioritize steady progress over grabby headlines. That may come as an unsatisfactory answer to some, but it is likely to yield the greatest benefits.

Gabriel Mitchell is the director of external relations at the Israeli Institute for Regional Foreign Policies (Mitvim) and a doctoral candidate at Virginia Tech University. Follow him on Twitter: @GabiAMitchell.

Image: Israeli Energy Minister Yuval Steinitz speaks at the third East Mediterranean Gas Forum (EMGF) meeting which is hosted by Egypt and brings together Cyprus, Greece, Israel, Italy, Jordan and the Palestinians in Cairo, Egypt January 16, 2020. REUTERS/Shokry Hussien/File Photo