Israel Braces for a New Egypt

By RICHARD BOUDREAUX in Jerusalem and JOSHUA MITNICK in NITZANEI SINAI, Israel

Israelis are bracing for a more adversarial regime in Egypt, one they expect could lead their country to expand its army, fortify the two countries' desert frontier and possibly re-invade the Palestinian-ruled Gaza Strip.

Israeli analysts remain concerned about possible new threats to the country's security amid unrest in Egypt and elsewhere in the Middle East. Special correspondent Martin Himel reports from Tel Aviv.

Three decades after Israel settled into a "cold peace" with Egypt—breaking its encirclement by hostile Arab states but failing to win much popular sympathy from Egyptians—Israeli officials are reviewing the ways the U.S.-backed transition in Cairo could affect the Jewish state.

The most likely scenario, say people familiar with the review: A new leadership, swayed by Islamist support and popular sentiment against Israel, would downgrade diplomatic and commercial ties, casting doubt on the long-term survival of the two countries' 1979 peace treaty.

On Wednesday, Defense Minister Ehud Barak voiced Israel's apprehension at a meeting with Secretary of State Hillary Clinton, Defense Secretary Robert Gates and White House National Security Adviser Tom Donilon. An administration official said the three assured Mr. Barak of the United States' "unshakeable commitment to Israel's security."

Mr. Barak had requested the White House meeting after President Barack Obama initially pressed for Egyptian President Hosni Mubarak's quick exit from power, a step that left Israeli officials surprised and dismayed.

Senior Israeli officials have warned that the crumbling of Mr. Mubarak's rule has already diminished U.S. and Israeli strategic clout in the Middle East, in the face of regimes in Iran and Syria that support armed Islamist groups and now seek to draw Egypt into their camp. "It will become more difficult for Israel to control events and their outcomes" over the coming year, Maj. Gen. Amir Eshel, chief of planning for the Israeli armed forces' general staff, told a security conference in Israel this week.

Israel has reacted to Egypt's unrest by moving to shore up gas supplies and promising steps to bolster the Palestinian economy. It has quietly signaled support for a gradual transition backed by the army and controlled by Omar Suleiman, Egypt's vice president and longtime intelligence chief. Mr. Suleiman has close ties with Mr. Barak and other Israeli leaders.

Seeking to shore up Israel's security, Prime Minister Benjamin Netanyahu has permitted the temporary deployment of 800 Egyptian troops into the Sinai, a sparsely populated peninsula demilitarized under the peace treaty. The aim is to prevent smuggling of weapons to Gaza, the neighboring Palestinian enclave ruled by Hamas.

Mr. Netanyahu also ordered the army to speed construction of a 13-foot-tall, radar-monitored fence it began putting up in November to plug 124 miles of desert frontier with the Sinai, a border now easily infiltrated by nomadic Bedouin smugglers of drugs and migrant workers.

"Everything is porous," said Menachem Zafrir, a 54-year-old resident of the Nitzanei Sinai border outpost, where backyards look into Egypt.

"Until now it's just Sudanese [migrants], but it could be militants," he said, gesturing to the thin deployment of Egyptian guards on the other side of a border now marked by a chest-high cordon of sagging barbed wire. "Today the Egyptian army patrols over there. But if there is a mess, they will flee."

As their elders learned of a Bedouin attack last Friday on Egyptian positions just 30 miles away, children at Nitzanei Sinai played capture the flag outside the grocery store.

"It's bizarre that this is the quietest place in the country despite the fact that it's a border," said Robert Fischer, a Nitzanei Sinai resident who owns a transport company. If an unfriendly regime comes to power in Egypt, "they will need to evacuate us."

Israel's security concerns extend to the West Bank. Wary that an Islamist-influenced regime in Cairo might inspire a Hamas-led uprising of Palestinians there, Mr. Netanyahu last week promised to spur economic growth in the West Bank and Gaza.

But Israel's leader has resisted Western pressure to make compromises that would help revive talks on statehood for the Palestinians. Taking such a step, his critics say, would defuse criticism across the Arab world.

Israeli officials also have urged stepped-up development of recently discovered Israeli offshore gas reserves. That would hedge against any shutdown by Egypt of the natural-gas pipeline that powers one-fourth of Israel's electricity network.

On top of such steps, however, Israel would have to remake strategic and military planning if Egypt were to turn unfriendly, officials and analysts say.

Israel's apprehension stems mainly from the strength of the Muslim Brotherhood, Egypt's best-organized opposition force, and the Brotherhood's close ties to Hamas. But Israeli leaders are also unsettled by doubts about the peace treaty voiced by Mohamed ElBaradei, the leading secular opposition figure.

"It's impossible to make peace with a single man," Mr. ElBaradei told German news magazine Der Spiegel last week. "At the moment, [the Israelis] have a peace treaty with Mubarak, but not one with the Egyptian people."

The U.S.-brokered 1979 treaty signed by Egyptian President Anwar Sadat and Israeli Prime Minister Menachem Begin gave up Israeli occupation of the Sinai in return for peace between neighbors who had waged four wars against each other. It also gave Egypt U.S. military aid that now exceeds $1 billion per year.

But while Israelis rushed to take advantage of tourism, trade and investment opportunities opened by the treaty, few Egyptians did so.

Israel's 1982 invasion of Lebanon embarrassed Egyptian leaders, already under fire in the Arab world for making peace with the enemy. Mr. Mubarak, who had taken over after Mr. Sadat's 1981 assassination, supported the treaty, but Israelis say his government has done little to encourage contact between the two peoples and has allowed Egyptian media to demonize the Jewish state.

Largely because the Israeli-Palestinian conflict festers, Egyptian businesses, labor unions and civic organizations with ties to the wider Arab world have shunned Israel, even as hotels welcome Israeli visitors.

"Israel sat on the Palestinians, built settlements on their land and put down two Palestinian uprisings, and the peace with Egypt lasted," said Janet Aviad, an Israeli peace activist who has visited Egypt five times. "But [the peace] couldn't warm up under those circumstances, no way."

Israeli officials say they believe the peace treaty would survive under an orderly transition in Egypt that preserves the powerful role of the U.S.-backed military and is led by Mr. Suleiman. According to a 2008 U.S. Embassy cable released this week by WikiLeaks, Mr. Suleiman has long been Israel's preferred successor to Mr. Mubarak. The cable said Mr. Barak's office and Mr. Suleiman's intelligence service were in daily contact over a telephone hotline.

Israeli officials are also pondering a worst-case scenario in which the Muslim Brotherhood dominates the next government, abrogates the treaty and ends the partial blockade that Egypt imposed on Gaza to help Israel isolate Hamas and choke off Gaza-bound weapons shipments.

A more likely outcome in Egypt, say Israelis familiar with the government's forecasting, is a ruling coalition that is sensitive to domestic public opinion and has minority Muslim Brotherhood representation. Such a coalition, they say, would likely maintain the peace treaty and gas exports for now but would also be likely to adopt a more critical tone toward Israeli policies and might become less accommodating to Israeli officials, entrepreneurs and other visitors.

More than 200,000 Israelis visit Egypt each year, drawn by Nile cruises, ancient monuments and the Sinai's pristine Red Sea beaches. Two-way trade is a small fraction of each country's imports and exports, however, so a reduction wouldn't cause significant economic harm to either side. It would, however, represent a symbolic setback to the relationship.

Far more damaging to Israel's economy would be the loss of the treaty's peace dividend.

Dan Schueftan, director of national security studies at Haifa University, said the rise of a less friendly regime in Egypt, even if it doesn't cancel the treaty, would create enough uncertainty that Israel would feel compelled to enlarge its army and raise defense spending. Mr. Netanyahu hinted as much when he called last week for "bolstering Israel's might."

"Egypt was the cornerstone of our security in the region, and when that stone is eroding, the whole Middle East changes in a profound way," Mr. Schueftan said. "Israel would have to operate in a completely different strategic environment with an army that has become very, very small compared to the threats that surround us."

Thanks to the treaty with Egypt, he said, Israel had reduced its defense expenditure from 23% of its gross national product in the mid-1970s to about 9% today. The relationship with Egypt also allowed Israel to end a costly military occupation of Gaza in 2005, as Egypt covered Gaza from the south.

Several former military and intelligence officials are arguing publicly that Israel must be prepared to reoccupy Gaza, or at least a wide swath of the enclave along its eight-mile border with Egypt. Other experts counsel caution, warning that such an operation would plunge Israel into years of fighting.

"There's no reason for us to make any decisions in the next few weeks or even more than that," said Giora Eiland, a former Israeli national security adviser. "We have to observe, and if the situation changes in a bad way, we will have time to shift whatever has to be shifted."

--Adam Entous contributed to this article.

Write to Richard Boudreaux at richard.boudreaux@wsj.com