The Egyptian transfer of the islands of Tiran and Sanafir in April 2016 to Saudi Arabia can be understood from at least four separate perspectives.
First, the agreement between the parties is another testimony of the close relationship between Cairo and Riyadh as part of the anti-Iranian axis. Within this alliance, Saudi Arabia had provided massive economic support to General al-Sisi’s regime and is now using the leverage it has to bring this issue to a close.
The islands’ history serves as a further reminder of the depth of Riyadh and Cairo’s relationship. The islands were part of Saudi Arabia until 1950 when Egypt gained effective control over them with Saudi acquiescence, as part of Cairo’s campaign against Israel. Herman Elits, who was the US Ambassador in Egypt in the heyday of Kissinger’s shuttle diplomacy, wrote in 2004 that Saudi Arabia refused to accept one of the islands from Israel, during the years in which Israel controlled the Islands (after the 1967 Six-Day War and until the implementation of the 1979 Israel-Egypt peace treaty). According to Elits, the Saudi position, which was based on commitment to the common Arab stance and to Egypt, was that the land should be returned to them only in the context of a comprehensive Arab-Israeli agreement.
Secondly, the peaceful resolution of this issue is part of a broader set of bilateral agreements that will benefit both countries. One such project is a joint initiative to build a bridge for transportation across the Red Sea that will connect southern Sinai and northwestern Saudi Arabia. This bridge, if it is built, will enable a flow of interaction between Arab Africa and Arab Asia. Such a bridge can also increase the volume of trade between the two continents, assisting the Egyptian economy.
Thirdly, both countries chose to resolve the issue bilaterally. The international system and international law in particular furnish disputing parties with multiple channels, fora, and norms to resolve conflicts. A similar approach is seen in some of the other regional disputes, such as the conflict between Israel and Lebanon over the demarcation of their respective international maritime boundary. This is another reminder of the limitations of international mediation – both in terms of substance and process – when coming to resolve inter-state conflicts in the region.
Finally, the agreement is the first formal territorial change in the Arab world since the beginning of the political instability in the region in late 2010. It is not a change in the full sense of the word, as the land was on a “loan” of sorts. And yet, it was significant enough for the numerous Egyptians that protested against the move. While a number of countries like Syria, Iraq and Libya are de-facto divided, the international norm of “border fixity” was strong enough till now to prevent any such formal change. The regional instability is likely to bring more territorial change, especially in disputed areas but perhaps also in formerly unitary states such as Syria.