S E C R E T CAIRO 000181 SIPDIS NOFORN E.O. 12958: DECL: 2020/02/09 TAGS: PREL, MASS, PARM, ETTC, EG SUBJECT: Scenesetter for Admiral Mullen CLASSIFIED BY: Margaret Scobey, Ambassador, DOS, EXO; REASON: 1.4(B), (D) 1. (S/NF) Key Points: -- Since your last visit, the U.S. and Egypt initiated a senior-level Strategic Dialogue that built upon the improved bilateral atmosphere following President Obama's June 2009 speech in Cairo. We have seen improved cooperation in multilateral fora, in addition to close cooperation on regional issues including Arab-Israeli peace and Sudan. -- While the U.S.-Egypt military relationship remains strong, the Egyptian military has been resistant to our efforts to adjust its focus to reflect new regional and transnational threats. -- While Egyptian leadership continues to view Iran as the greatest strategic threat to the Middle East, the Israeli-Palestinian conflict and Sudanese instability are immediate concerns for Egypt. -- Egypt has increased counter smuggling efforts, including the construction of a subterranean steel wall along the Egypt-Gaza border that has provoked intense domestic and regional criticism of perceived complicity in the Israeli blockade of Gaza. ---------------------------- Renewed Cooperation ---------------------------- 2. (C) Admiral Mullen, welcome back to Egypt. Building upon the optimism generated by a new U.S. administration and President Obama's well-received June 4 speech in Cairo, we resumed in June our Strategic Dialogue and set in place a new framework for regular bilateral meetings with the Egyptians to explore areas for cooperation and coordination, including examining our respective assessments of strategic threats such as Iran. The most recent meeting was hosted by Under Secretary Burns in December in Washington. We are exploring other ways to translate this sense of goodwill into concrete action, including a renewed focus in our bilateral assistance programs on human capacity development and strengthening Egypt's ability to compete in education, science, and technology. 3. (S/NF) Our goal remains to widen our military cooperation discussion beyond the annual flow of Foreign Military Financing (FMF). At the end of 2009, we conducted our two premier bilateral military events - the annual Military Cooperation Committee (MCC) meeting and the Bright Star military exercise. During the MCC, Egypt agreed to implement specific measures to improve their ability to protect U.S. technology. During Bright Star, the Egyptians canceled several joint-operations that would have broadened the exercise's scope. We are working hard to ensure that Bright Star 2011 will involve full-spectrum operations. Tantawi and his senior leaders recognize and appreciate increased engagement with the U.S. military, which provides us an opportunity to highlight for them the need to sharpen and focus the Egyptian military's mission to reflect new regional threats. Egypt's offer to train Iraqi and Afghan military officials provides an opportunity for the Egyptian military to play a greater role in supporting regional security. Egypt also has plans to significantly increase its peace-keeping presence in Africa, including a new deployment to the Democratic Republic of the Congo, and we hope to support their efforts through Egypt's inclusion in the Global Peace Operations Initiative. We have requested meetings for you with President Mubarak, MinDef Field Marshall Tantawi, CoS LTG Anan, and EGIS Chief MGen (ret) Soliman. --------------------- Regional Security --------------------- 4. (S/NF) President Mubarak sees Iran as Egypt's -- and the region's -- primary strategic threat. Egypt's already dangerous neighborhood, he believes, has only become more so since the fall of Saddam, who, as nasty as he was, nevertheless stood as a wall against Iran. He now sees Tehran's hand moving with ease throughout the region, "from the Gulf to Morocco." The immediate threat to Egypt comes from Iranian conspiracies with Hamas (which he sees as the "brother" of his own most dangerous internal political threat, the Muslim Brotherhood) to stir up unrest in Gaza, but he is also concerned about Iranian machinations in Sudan and their efforts to create havoc elsewhere in the region, including in Yemen, Lebanon, and even the Sinai, via Hezbollah. While Tehran's nuclear threat is also a cause for concern, Mubarak is more urgently seized with what he sees as the rise of Iranian surrogates (Hamas and Hezbollah) and Iranian attempts to dominate the Middle East. 5. (S/NF) The Egyptians have stepped up their cooperation with the Iraqis considerably, primarily through establishment of a "joint committee" which covers the full range of economic, social, military and political bilateral development. In November 2009, the Egyptians returned an ambassador to Baghdad. MOD is also requesting USG approval to sell Iraq 140 M1A1 tanks manufactured in Egypt under a co-production agreement. On Afghanistan, the GOE has agreed to explore expanding its scope and breadth of programs there, including in the areas of education, women's empowerment and communications. Egypt has operated a military field hospital at Bagram since 2003 with approximately 60 personnel. 6. (S/NF) Egypt's top priority in Africa is the future of Sudan. The GOE would like to maintain Sudanese unity because it believes a break-up will increase refugee flows into Egypt and threaten Egypt's access to Nile waters. However, the GOE is hedging its bets by providing South Sudan with development assistance including building and staffing medical clinics, helping to clear aquatic plants from the White Nile and building power stations and a university. Egypt is the fifth-largest peace keeping contributor in the world, with the majority of its troops deployed to southern Sudan and Darfur. They have also agreed to deploy a large contingent to the Democratic Republic of the Congo. 7. (S/NF) Egypt continues to support our efforts to resume negotiations between the Israelis and Palestinians and maintains a regular dialogue with all sides. Egyptian sponsored negotiations on Palestinian reconciliation are ongoing. Egypt's objectives are to avoid another Gaza crisis while eroding Hamas' power and ultimately returning the Palestinian Authority to Gaza. --------------------------------------------- ----- Mil-Mil Cooperation: Counter Smuggling --------------------------------------------- ----- 8. (S/NF) President Mubarak and military leaders view our military assistance program as a cornerstone of our mil-mil relationship and consider the USD 1.3 billion in annual FMF as untouchable compensation for making peace with Israel. Decision-making within MOD rests almost solely with Defense Minister Tantawi. In office since 1991, he consistently resists change to the level and direction of FMF funding and is therefore one of our chief impediments to transforming our security relationship. Nevertheless, he retains President Mubarak's support. You should encourage Tantawi to place greater emphasis on countering asymmetric threats rather than focusing almost exclusively on conventional force. 9. (S/NF) Egypt continues to use a wide range of military, security, intelligence, and diplomatic efforts to combat the flow of arms to Gaza. The effectiveness of these efforts is difficult to assess, and our visibility into these programs is limited. However, Egypt has reported success in identifying and intercepting arms smuggling networks from Sudan to Cairo, as well as interdicting illicit funds destined for Gaza. Israeli officials have also reported some satisfaction with increased Egyptian efforts. MOD is also participating in a USG-financed project - led by EGIS - to install 15 x-ray scanners along the vehicular entrances to the Sinai to search for arms and explosives. 10. (S/NF) Tantawi continues to resist U.S. offers of additional counter smuggling assistance. Sovereignty concerns are likely driving his hesitation, along with concerns that FMF funds may be directed away from more high-profile programs like M1A1 tanks and aircraft. You should encourage Tantawi to focus more U.S. assistance on border security, especially along the remote Egypt-Sudan border. You should also remind Tantawi that no single technology can stop smuggling. Success will depend on how well Egypt uses all available tools and resources to identity and disrupt smuggling networks. He will likely reply that BTADS - currently on-hold because of security concerns - and the subterranean steel wall MOD has begun to install along the Egypt-Gaza border, will provide a sufficient counter-smuggling capability. 11. (S/NF) Tantawi will likely express concerns over releasability issues and frustration with Egypt's inability to procure restricted weapons systems. However, concerns over Egypt's end-use performance, especially in Congress, continue. You should stress that decisions to release advanced weapons systems are made on a country-by-country basis, but continued cooperation to improve Egypt's protection of American technology and signing a CISMOA would be welcome steps in our dialogue on releasability. -------------------------------------- Internal Politics and Economics -------------------------------------- 12. (C) We continue to promote democratic reform in Egypt, including the expansion of political freedom and pluralism, and respect for human rights. While Egypt has made some limited gains over the last several years, such as on freedom of the press, progress overall has been slow. We continue to press the GOE to replace the State of Emergency, in place almost continuously since 1967, with counterterrorism legislation that protects civil liberties. Designed to target violent Islamist extremist groups, the GOE has also used the Emergency Law to target political activity by the Muslim Brotherhood, bloggers and labor demonstrators. The Interior Ministry suppresses political opposition through arrests, harassment and intimidation. 13. (C) The GoE remains skeptical of our role in democracy promotion, arguing that any efforts to open up will result in empowering the Muslim Brotherhood, which currently holds 86 seats -- as independents -- in Egypt's 454-seat parliament. Elections for the upper house of the parliament, or the Shura Council, are to be held in June 2010 and elections for the lower house of parliament or the People's Assembly are now scheduled for October 2010. Presidential elections will be held in 2011. It is still unclear whether President Mubarak, in power for over 25 years, will decide to run again. Some believe that he is grooming his son, Gamal Mubarak, to succeed him as President. 14. (SBU) Economic reform is ongoing although Egypt still suffers from widespread poverty affecting 35-40% of the population. Egyptian-U.S. trade more than doubled between 2005 and 2008, before slumping in 2009 amidst the global economic crisis. Bilateral trade volume was roughly $7.5 billion in 2009, and the U.S. exports to Egypt more than twice as much as it imports. Egyptian banks operate very conservatively and have been spared involvement in risky financial products, but the effects of the global economic crisis on Egypt are beginning to be felt. As the global credit crunch worsens, Egypt remains vulnerable as exports, Suez Canal revenues, tourism, and remittances - its largest sources of revenue -- are all down and will likely to continue to fall. SCOBEY

VZCZCXYZ0002 OO RUEHWEB DE RUEHEG #0181/01 0401511 ZNY SSSSS ZZH O R 091511Z FEB 10 FM AMEMBASSY CAIRO TO RUEHC/SECSTATE WASHDC IMMEDIATE 0204 INFO RHEHAAA/NATIONAL SECURITY COUNCIL WASHINGTON DC RHMFISS/HQ USCENTCOM MACDILL AFB FL RHMFISS/JOINT STAFF WASHINGTON DC RUEHEG/AMEMBASSY CAIRO RUEKJCS/SECDEF WASHINGTON DC