Earlier this week, a delegation of Saudi investors arrived in Egypt, headed by the chair of the Federation of Saudi Chambers, for talks on the possible expansion of Saudi investments in Egypt. The delegation of 100 investors is being accompanied by members of the Egyptian-Saudi Business Council. The visit follows Egypt and Saudi Arabia’s adoption of an agreement to encourage and protect mutual investments.
During their visit to Egypt, members of the delegation will meet with Egyptian counterparts, government officials, and cabinet ministers and visit the sites of potential Saudi investments.
It is not clear whether the delegation will give a push to mega deals similar to the Ras Al-Hekma agreement Egypt signed with the United Arab Emirates. Ras Al-Hekma is a Mediterranean coastal enclave of 170 million square metres. Under the 2024 deal, the UAE agreed to pay Egypt $35billion in two installments. The area will be turned into an international tourism hub, with Egypt expected to gain about 35 per cent of anticipated revenues.
According to a government official, similar deals are almost certain to be proposed during the meetings the delegation will hold with senior Egyptian officials because “Cairo is very interested to strike similar deals to help give a push to the economy.”
The section on the Egyptian economy in Al-Ahram Centre for Political and Strategic Studies’ (ACPSS) annual Strategic Report published earlier this month notes that, as of last year, “Egypt adopted a new strategy to strike mega deals of direct investments as part of the economic reform programme the government has adopted, [including] deals like Ras Al-Hekma, Ras Gamila, and Ras Banas.”
Ras Gamila and Ras Banas are on the Red Sea, close to spectacular coral reefs. Earlier this year, government officials said that there are ongoing negotiations between the Egyptian and Saudi governments to develop the area.
According to the official who spoke with Al-Ahram Weekly, the government is committed to both deals to give “a booster” shot of foreign currency to Egypt’s economy and help contain any fall in the exchange rate at a moment of international economic uncertainty.
The ACPSS report notes that on its inauguration in June, the fourth government since President Abdel-Fattah Al-Sisi took office in June 2014 announced its commitment to attracting mega investments as part of an ambitious economic scheme that also includes reducing overall national debt, putting a cap on borrowing, and selling off public companies.
The report adds that these policies, especially the mega investment deals and the selling of public companies, have divided experts, with some seeing them as a forward-looking scheme that could improve the performance of the economy and influx of foreign currency and others expressing concern over the de-nationalisation of vital sectors.
According to the report, the lack of consensus extends to the government’s political choices on the home and foreign fronts. On the domestic front, the report notes that one camp argues that the process of democratisation is too slow while another says anything faster could prove destabilising. On the foreign policy front, specifically on the issue of Gaza, there are also two camps, one arguing for a more aggressive policy towards the Israeli war on Gaza and another arguing that Egypt should avoid becoming embroiled in non-Egyptian affairs.
The ACPSS report argues that this “division” is reflected in the debate over Egypt’s national identity and the split between the Islamist and secular camps.
WIDER UNCERTAINITIES: According to the report, the economic and political decisions Cairo madein2024, and is set to make throughout 2025, are being conditioned by regional turbulence, including the crisis over the Red Sea, exacerbated by Houthi attacks on shipping which have severely reduced Suez Canal traffic and Egypt’s canal revenues.
To avoid making a complicated situation more complex, the report notes that Egypt refused to take part in attacks against the Houthis and, for the longest time, refrained from making any direct reference to the Houthis in official statements on the state of instability in the Red Sea. This, the report argues, is part of a careful Egyptian policy to steer clear of potentially explosive situations.
According to an Egyptian diplomat, Egypt tried to get the Houthis, through multiple channels, including via Tehran, to refrain from the attacks that recently prompted aggressive US strikes ordered by US President Donald Trump.
The report also details Egypt’s diplomatic campaign, pursued in cooperation with Qatar, to secure a ceasefire in the Israeli war on Gaza and Cairo’s attempts to facilitate Palestinian reconciliation, essentially between Hamas in Gaza and the Palestinian Authority (PA) in the West Bank. The attempts faltered because Mahmoud Abbas, the president of the PA, refused all the many forms of power-sharing that Cairo, along with other mediators, proposed.
According to the same Egyptian diplomat, Abbas saw “the weakness of Hamas after over a year of the devastating Israeli war” as a moment of potential surrender by his arch-political enemy.
During a meeting with a senior Fatah delegation in Cairo last week, said the diplomat, Egypt stressed the need for some flexibility to allow for a political set-up for the management of Gaza once a new ceasefire is achieved.
Meanwhile, an informed political source said that a new ceasefire should go into effect “within a week or so”. The new truce will start following Egyptian mediation offering a resumption of the hand-over of Israeli hostages “without the theatrics staged at the previous handover of hostages” and includes a 70-day ceasefire and the entry of humanitarian aid into Gaza, the distribution of which will be overseen by a non-factional Palestinian committee.
But according to the ACPSS report, nothing is certain about the future of Gaza or the West Bank. The report notes that Israel’s military campaign in Gaza has allowed Israeli political and military bodies to rework their objectives —from using power to avoid political or territorial compromises to using it to impose new realities on the ground. With this shift, it adds, the government of Benjamin Netanyahu is unlikely to stop the war before it finishes the job it has started and eliminates Hamas.
This objective, the report explains, is not just about changing the power dynamics of the Middle East, something Netanyahu has spoken of regularly, especially after Israel’s elimination of top Hamas and Hizbullah leaders. It is also about fulfilling the dream of Greater Israel outlined by Israel’s founding prime minister David Ben-Gurion.
Doing this, notes the report, will require the re-annexation not just of Gaza but also of the West Bank. This has become possible, not just due to Israeli military might but because the Haredim has given Israel the population growth to control and populate these territories.
According to the political source, “nothing is certain on the future of Gaza or the future of the West Bank.” He explained that during the past few months, with its military raids, Israel has been dividing the West Bank into quarters with limited, if any, territorial connectivity.
Earlier in the year, the same source said that Israel is planning to eliminate three Palestinian refugee camps and turn them into plots for Israeli settlers.
Reports in the Israeli press this week confirmed the divisions that Israel is imposing on the West Bank. The reports suggested that the endgame is to have tribal leaders running the quarters, effectively replacing the PA which the Netanyahu government believes is in terminal decline.
Israel has also been carving up Gaza. A source close to Hamas said that the objective of Israel is no longer to remove Hamas but to push as many Palestinians as possible to leave the Strip.
According to the ACPSS report, the Israeli objective is clear and fully supported by Trump— to expel Palestinians from their land. While noting the “firm positions taken by Egypt and Jordan” in the face of such proposals and the ambitious international diplomatic scheme launched by Saudi Arabia to promote a two-state solution, the report shared no sense of certainty on the future of the Palestinian cause. It notes that despite the aggressive Israeli war on Gaza, talk about expanded Arab-Israeli normalization is not completely off the table.
The report noted how Saudi Arabia has conditioned diplomatic ties between Riyadh and Tel Aviv on the establishment of a Palestinian state and that Crown Prince Mohamed bin Salman made this commitment before the Saudi Shura Council.
The ACPSS is far more uncertain about the future of Syria’s relations with Israel than Saudi Arabia’s, especially after Israel occupied Syrian territory following the “sudden fall of the Al-Assad regime” on 8 December. According to the report, nothing is clear about Syria’s future, including its support of the Palestinian cause, and the only thing that can be said for certain is that, by the end of 2024, Israel had managed to almost fully neutralize the “impedance axis” with the elimination of Hassan Nasrallah, the leader of Hizbullah in Lebanon, and the growing caution of Shia militant groups in Iraq given the Iraqi government’s wish to end any presence on its territory of the US-led alliance that invaded Iraq in 2003.
For Egypt, the report notes, uncertainties abound not just on its eastern border with Gaza, but beyond its southern border with Sudan and western border with Libya.
The report argues the African Sahel zone is entering a new phase of possible hiccups given the inability of the new leaders in Burkina Faso, Niger, and Mali to pursue democracy or bring about stability. It adds that that these Russian supported regimes are escalating tensions across North Africa, and especially with Algeria and Mauritania which have both been subject to border incursions.
OLD RULES, NEW DYNAMICS: For Africa, as for the rest of the world, the ACPSS report argues that the dynamics of international relations, in place since the end of World War II, are slowly falling apart. This, says the report, includes the receding role of the UN and the Security Council in settling conflicts, the prolonged war in Ukraine that Russia is leading, the emergence of anti-Western alliances including China and North Korea, and the imposition of protective trade measures that are curbing the “excessive globalisation” that has gained traction since the 1990s.
Challenges faced by the international system include the role of international organisations, the rule of international law, and an imploding value system. The rise of new alliances and counter alliances, the report notes, is just one of many symptoms of system failure.
Other signs include the rise of ultra-nationalism and the retreat of “Western-based liberal concepts of human rights” in the face of the double-standards that the West, especially the US, has increasingly embraced. “The US itself has been going through a serious drop in the quality of its democracy and a decline of liberal values in favour of the rise of anti-refugee, anti-foreigners and anti-cultural diversity sentiments,” says the report.
The US is not the only country beset by populism and right-wing policies and sentiments. Europe is also facing a rising tide of populist sentiment and India’s ultra-right government has been able to stay in power for over a decade, notes the report.
There is a shift in the international balance of power. The dominance of Western powers is being challenged by the rise of Asian countries, not just economically but on more futuristic fronts, including the command of artificial intelligence (AI), the launch of lunar gateways, and space militarisation.
Given the increasing use of AI on the military front, it is significant, notes the report, that in 2024 the presidents of China and the US agreed that the use of nuclear weapons should be a strictly human prerogative. Later the same year, more than 40 countries agreed that the military use of AI should be subject to a tight code of ethics and legal scrutiny.
There are more reasons for worry than reassurance about where the world is heading. The report cites nuclear North Korea’s decision to abandon its long-standing policy to pursue peaceful unification with South Korea, Russia’s loosening of its nuclear creed and China’s ongoing skirmishes over Taiwan and control of South China Sea as particular concerns.
The ambitious Chinese Belt and Road Initiative is facing obstacles. The same applies to the India-UAE inspired India-Middle East-Europe Economic Corridor that is supposed to connect India with the Gulf, the wider Middle East, through Jordan and Israel, and Europe via Italy.
In the introduction to the report, Wahid Abdel-Meguid, senior analyst and commentator at the ACPSS, argues that 2024 was the year of “black swans”, a term used to refer to unexpected events. They include seemingly unending wars in Ukraine and Gaza, developments in Lebanon, and Syria and the regional rise of Israel at the expense of non-Arab players such as Iran and Turkey.
Whatever happens this year or next, Abdel-Meguid argues, one thing is clear. New rules are in the making.
* A version of this article appears in print in the 17 April, 2025 edition of Al-Ahram Weekly
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