The consequences of the “Arab Shaking” have yet to end. Each state that experienced these “winds of change”, withstands the emerging regional and international reality differently, based on the way it defines its current position. Egypt under a-Sisi, and in the post-Mursi era, has re-defined its aims and mode of action. The newly created Egyptian national security outlook prioritized two main objectives: to restore (both domestic and regional) security and to strengthen the Egyptian economy.

Regarding the security objective, as soon as Egypt defined “terrorism” (both domestic and international) as its biggest threat, it made sure to label the Muslin Brotherhood movement a terror organization and carried out severe measures against its members. Furthermore, the Egyptian authorities have occasionally accused the Hamas of carrying out terror attacks in cooperation with the Muslim Brotherhood and intermittently with ISIS. No wonder that every now and then news surrounding military cooperation between Egypt and Israel battling ISIS in the Sinai Peninsula appear in the media.

In addition to this, the Iranian policy in the Middle East is perceived by Egypt as a threat (and so by Saudi Arabia, Jordan, Israel and the United Arab Emirates). Both Turkey and Qatar are considered Egypt’s consistent and uncompromising rivals, due to their support for the Muslim Brotherhood and Hamas, and based on their membership in the Middle Eastern axis opposing Egypt. A new reality has evolved that we have never seen before, in which the regional interests of Israel and Egypt, as well as those of other Arab states, have intertwined.

The long-standing Egyptian policy that strives to resolve the Palestinian issue relies, even to this day, on its ability to engage in what is happening in the Gaza strip. Egypt wishes to promote steps of reconciliation within the Palestinian wing itself (between Hamas and the Palestinian Authority), and to serve as a mediator between the Palestinians as well as between the Palestinians and Israel. All actors in this equation view Egypt as a trustworthy and influential actor. In this way, Egypt acts as the most significant mediator that negotiates understandings between Israel and Hamas, and that supports Israeli-Palestinian dialogue. Egypt is expected to continue playing such a role in the future as well.

The meeting between Israel and Egypt’s leaders that took place during the 2018 UN General Assembly, was not the first meeting between Netanyahu and a-Sisi this past year. Among the issues discussed by the two leaders were the situation in Gaza, the Palestinian issue, security matters, regional developments and bilateral issues. The meeting reflected rather accurately the cooperative relations between the two countries over the past four years.

The second objective put forward by the Egyptian leadership has been to stabilize the economy. A strong sense of security and a steady economy may turn Egypt into a source for regional stability. This leads Egypt to be increasingly interested in promoting economic and trade cooperation with Israel. Egypt hold an important strategic location, on the maritime route from the Indian ocean through the Bab al-Mandeb strait, and toward the Suez Canal and the Mediterranean Sea. Therefore, the interest in Egypt’s stabilization is not limited to regional actors alone, but is also eminent for the US, the EU, Russia, India, and China. This generates international interest in supporting Israeli-Egyptian cooperation as a keystone for enhancing regional stability.

Broader cooperation between Israel and Egypt in the security and-political spheres may stimulate their economic relations and therefore work for the benefit of both countries. Nevertheless, there is still a significant gap between the high level of strategic cooperation between Israel and Egypt, and their much lower level of civil cooperation. The number of Israelis touring Egypt is stable but rather low. Trade between the countries is taking place but to a limited extent, and the same is true regarding the field of agriculture, where there is far greater potential for cooperation than what is taking place today (at least in comparison to cooperation in the 1990’s). In addition to that, there is potential for Egypt to utilize technologies such as solar energy and water desalination, areas of which are widely known as Israel’s field of expertise, both as a manufacturer and as an implementer.

The field of energy, and in particular the production and marketing of natural gas, plays a central role in the Israeli-Egyptian economic and trade cooperation. Moreover, both countries can cooperate in traditional industry fields, in unique qualified industrial zones (QIZ, a three-way agreement that allows the export of free trade Egyptian goods to the US, in the condition they hold a certain percent of Israeli components), in agriculture, tourism and more. Such cooperation can promote both Israel’s and Egypt’s economies, and have a positive economic impact on the broader region.

The announcement made by the Israeli company “Delek Drilling” that it will purchase (together with the Noble Energy and East Gas companies) the Egyptian EMG company is a step towards achieving these goals. The natural gas pipeline owned by EMG connects Israel and Egypt, and will deliver natural gas from the “Tamar” and “Leviathan” reservoirs to Egypt. This is considered to be a milestone in transforming Egypt into a regional energy hub, as a major importer and as an exporter based on its liquefying gas facilities. According to Israel’s Minister of Energy Yuval Steinitz, the rehabilitation of the Israeli-Egyptian natural gas pipeline, along with the construction of a Jordanian-Israeli pipeline, creates a regional foundation between the “peace countries”. It is rare to have a joint infrastructure project with geo-political significance take shape between Israel and its neighbors.

The positive nature of Israel-Egypt ties in recent years, together with evolving regional developments in the Middle East, Egypt’s role in mediating between Israel and the Palestinians, and the steps taken by Egypt to thaw the “cold” peace with Israel, may all point to the existence of an opportunity for further advancement in ties between two strategic partners in the region – Egypt and Israel.

Dr. Haim Koren, a task-team member at Mitvim – The Israeli Institute for Regional Foreign Policies, served as the Israeli Ambassador to Egypt between the years 2014 and 2016. This article is based on a research on Israel-Egypt relations, written as part of Mitvim Institute’s project on the unfulfilled potential of Israel’s relations with Arab countries.

(originally published in the Jerusalem Post)

הפוסט Israel and Egypt: A Strategic Axis in the Regional Landscape? הופיע לראשונה ב-Mitvim.

Israel, Cyprus, and Greece have demonstrated an enduring interest in collaborating on an ambitious undersea pipeline that would deliver Israeli and Cypriot gas to Europe. Since 2011, heads of state from these three East Mediterranean states have met on a regular basis and signed MOUs pledging future energy cooperation (in addition to other areas), if and when the climate is right. Italy’s deepening participation in these dialogues only adds to the general sense of enthusiasm surrounding the appropriately named “EastMed pipeline”. Neither consensus between multiple governments nor the European Union’s commitment of $100 million in a feasibility study – a number that sounds significant, but in comparison to the estimated $7 billion pipeline costs, is a drop in the ocean – promises that this vision will become reality. After all, the average Israeli family invests a larger percentage as a down payment for an apartment.

Commercial viability lies at the center of the EastMed pipeline debate. At present, companies like Noble Energy and Delek Group have found more success in smaller, regional deals. The decision to export Israeli gas to Egypt, for example, demonstrates the compelling logic of limited scale projects where there is pre-existing infrastructure. By contrast, the EastMed pipeline – which would be the world’s largest undersea pipeline – requires not only investment and partnership between multiple corporations, but also the patience to endure a longer, more ambitious, and riskier route. Eni, the Italian oil and gas supermajor developing many of Egypt’s reserves and also investing in Cyprus’ waters, might be the perfect partner for such an endeavor, however there is little indication at present that developers are in agreement about the EastMed pipeline’s feasibility and estimated timeline.

If a consortium of corporations did decide to invest in the EastMed pipeline, its members would need to be resolute in the face of the proposed pipeline route’s many anticipated engineering challenges, shifts in the global energy market that may temporarily nullify the economic value of the pipeline, as well as the predictable delays that would accompany an enterprise of this scale. It took four years to connect Tamar field – a modest, 90 kilometer pipeline – to Israel’s coastline, so it is ambitious to imagine that a 2,200 kilometer pipeline would be constructed in similar timetable. So long as shorter, cheaper options are available, it is unclear that the EastMed pipeline will reach the minimal financial investment required to get off the ground.

That doesn’t mean Steinitz is barking up the wrong tree. After all, Israel has signed impactful export agreements with Jordan, Egypt, and the Palestinian Authority. In an increasingly diverse and competitive energy market, one must generate headlines in order to attract investment (on November 5, Israel extended its bid round for offshore exploration licenses), and Steinitz has proven to be a talented frontman for the Netanyahu government’s energy ambitions.

Still, Steinitz’s statement to Israeli TV on November 24 was oddly tone deaf. “For decades, we have complained about the Arab influence in Europe due to oil and gas,” he told Hadashot news, “The export of gas to Europe will moderate this influence to a certain extent and be a counterweight to Arab power.” While historically oil-producing Arab states have wielded outsized international influence because of their central role in the global energy market (and specifically in the case of the Arab-Israeli conflict), many of these states are in the midst of a budding security relationship with the Jewish state. Steinitz seemingly ignores the fact that the selling point of the EastMed pipeline from a European perspective is the opportunity to diversify supply and reduce Russian influence, not necessarily Arab influence. Most importantly, the minister’s claim was based on state-level analysis of energy’s impact, sidestepping the bigger question that Israelis should be asking themselves: how will the EastMed pipeline impact my bottom line?

A major infrastructure project that delivers Israeli gas to Europe would be a historic achievement, strengthening a diplomatic and economic partnership that is essential to Israel’s success. But that doesn’t mean the average consumer is going to feel the difference when they receive their monthly electricity bill, and Israel’s government must make a more concerted effort to explain how it remains in the public interest to support projects like the EastMed pipeline. Failure to do so may result in a wave of protests similar to those that responded to the original natural gas framework. Given that the EU feasibility test is expected to offer its conclusions in 2019, there is no better time for the government to start answering the big questions associated with Israel’s energy policy.

Gabriel Mitchell is a Policy Fellow at the Mitvim Institute, and a PhD Candidate in international relations at Virginia Tech University.

(originally published in Globes)

הפוסט EastMed Gas Pipeline Must Overcome Major Obstacles הופיע לראשונה ב-Mitvim.