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Friday, September 16, 2011     INTELLIGENCE BRIEFING

Report: U.S. losing influence in Egypt despite $1.3 billion in aid

WASHINGTON — The United States has lost leverage over Egypt, a report said.


The Washington Institute for Near East Policy has determined that Washington no longer has leverage over an increasingly Islamic Egypt. In a report, the institute said U.S. aid, particularly military assistance, can no longer ensure that Egypt would maintain stability in the region.

"The potential for Egypt's revolution to take an anti-democratic turn — either toward more radical, anti-liberal, anti-West policies or toward a new authoritarianism — is frighteningly high," the report said. "No matter which path the Egyptian revolution takes, Egypt-Israel peace, in any tangible sense of the term, is almost surely a victim."

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The administration's immediate challenge was to prevent an Islamist government in Cairo.

The report urged Washington to offer free trade as an incentive meant to discourage the election of the Muslim Brotherhood in presidential and parliamentary elections expected in late 2011.

"The United States has virtually no economic leverage over the Egyptian government," the report, titled "Needed: High-Level U.S. Attention to the Dire Situation in Egypt," said.

Author Robert Satloff, the institute's executive director, cited annual U.S. military assistance to Egypt of $1.3 billion per year. The report said the aid has failed to persuade the new Egyptian military regime, which controls the Suez Canal, to maintain relations with neighboring Israel.

"Furthermore, military aid is a hollow lever, given that the Pentagon wants to sustain the U.S. relationship with the Egyptian armed forces at least as much — if not more — than the Egyptians themselves," the report, released on Sept. 13, said. "In this environment, U.S. threats have limited utility."

The administration of President Barack Obama has appointed William Taylor as the State Department's special coordinator for Middle East transitions. The report said Taylor's biggest challenge would be to maintain the U.S.-sponsored Egyptian-Israeli peace treaty amid rising opposition from the Muslim Brotherhood. On Sept. 10, Egyptians attacked and ransacked the Israeli embassy in Cairo.

The report said Egypt was moving toward a "no war, no peace" relationship with Israel. Satloff, a leading analyst on the Middle East, said this would be "almost impossible to sustain" and endanger U.S. interests in the region.

"As Egypt's elections approach, the likely results range between bad and worse," the report said. "Liberal, reformist forces will not have a majority. The question is how large a plurality will be achieved by illiberal Islamist groups."

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