EGYPT´S REDLINE IN THE RED SEA / GEOPOLITICAL FUTURES

Egypt’s Red Line in the Red Sea

Cairo can’t afford to compromise the Suez Canal, even at a distance.

Xander Snyder

With all the reports of Saudi Arabia using American weapons to kill people in Yemen, it’s easy to overlook Egypt, a quieter if not quite silent Saudi partner fighting in Yemen’s civil war. Its reluctance to get any more involved than it currently is comes from experience. It lost some 25,000 soldiers when it sent troops to Yemen during the North Yemeni Civil War of the 1960s – a campaign that led only to economic calamity at home. This round, it made sure to limit its involvement to naval operations and air support despite Saudi pleads to commit ground troops.

And it makes sense that this would be the case. Egypt has a vested interest in Yemen (otherwise it wouldn’t have sent troops back in the 1960s), but unlike Saudi Arabia, which shares a border with Yemen, its interests are not on the ground. Instead, its interests are in the water. It needs to maintain freedom of navigation throughout the Red Sea, which runs from Egypt’s Suez Canal in the north to the Bab el-Mandeb in the south, a strait that at its narrowest is just 12 miles (20 kilometers) wide.

Yet recent events could compel Cairo to deploy the troops it once refused to. In July, two Saudi ships were attacked by Houthi rebels, the Yemeni insurgents who took control of the government in Sanaa. The Houthis said they were warships; Saudi Arabia said they were oil tankers. Whatever they were, Riyadh responded by temporarily suspending oil exports from the Red Sea.

Then on Aug. 6, a retired officer from Iran’s Islamic Revolutionary Guard Corps told Fars news agency, a government mouthpiece with close ties to the IRGC, that Iran had instructed the Houthis to conduct the attack. The accusation hasn’t been confirmed, but it’s well within the realm of possibility. Iran supports the Houthis, though the government in Tehran denies it. The Houthis have a habit of attacking Saudi targets. And as U.S. sanctions on Iranian oil draw closer, Tehran has said it would to go to more extreme measures to protect its interests, including by blockading the Strait of Hormuz. Even as recently as July, the head of the IRGC issued a veiled threat suggesting Iran might do what the Houthis did to the Saudi ships.

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This is a threat Egypt takes seriously. A week after the Fars report was published, Egyptian President Abdel-Fattah el-Sissi condemned Iran’s involvement in the attack, even if he refrained from referring to it explicitly: “We categorically reject that Yemen would become a foothold for the influence of non-Arab forces, or a platform for security and stability threats against the brotherly Arab countries or freedom of navigation in the Red Sea and Bab al-Mandab Strait.” It’s no coincidence that he issued the statement during a state visit by Abed Rabbo Mansour Hadi, the president of what Saudi Arabia claims is the legitimate government in Yemen. Statements such as these are often as meaningless as they are perfunctory. But in this case, el-Sissi has sent a clear message by drawing a red line through the Red Sea, which is vitally important to the Egyptian economy. Right now, tolls from the Suez Canal generate about $5 billion in annual revenue, accounting for just about 2 percent of Egypt’s gross domestic product. But Cairo has grand plans for its future. In 2015, it completed an $8 billion expansion of the canal that opened a second passageway, allowing for two-way traffic and representing the first step toward Cairo’s eventual goal of making Egypt a regional industrial and logistics hub. Egypt hopes that canal revenue will more than double by 2023. Its investment minister even expressed the hope that the canal and its associated economic activities – specifically, a special economic zone featuring industrial parks and ports on the Mediterranean and Red seas – will eventually comprise as much as 30 percent of the Egyptian economy. The canal, moreover, is the source of a consistent and substantial inflow of foreign currency. For a country that has recently had to float its currency per the terms of a loan from the International Monetary Fund, more foreign currency reserves mean more protection in the event the Egyptian pound weakens. Given the ongoing currency crises in Turkey and Iran, this is no small consideration. Egypt itself avoided a foreign currency crisis four years ago only by taking the aforementioned IMF loan. Keeping the Red Sea free of an aggressive Iranian presence, and keeping the Suez Canal full of traffic, is therefore in Egypt’s interest. Saudi Arabia’s suspension of oil exports spooked Egypt, which was worried that shipping companies might take it as a sign that the Red Sea was no longer safe to use. An anonymous official from the Suez Canal Authority went so far as to claim that Egypt strongly but privately encouraged Saudi Arabia to resume exports accordingly. It’s too early to say whether anyone has yet crossed Egypt’s red line. But if American actions force Iran to adopt a more hostile posture in the Red Sea, Egypt may have no choice but to intervene more heavily in Yemen. It can’t afford to let Iran block these vital waterways. But, importantly, neither can the world’s trading powers. It’s in their interest to keep global trade humming too, so if worse comes to worst, the burden wouldn’t fall on Egypt alone.