Politics

Palestinian state, Red Sea security dominate Saudi-Egypt meet

Saudi Crown Prince Mohammed bin Salman visits Cairo for the first time in over two years to discuss pressing regional developments as well as investment opportunities

SPA

Saudi Crown Prince Mohammed bin Salman with Egyptian President Abdel Fattah el-Sisi in Cairo, Egypt.

Palestinian state, Red Sea security dominate Saudi-Egypt meet

Amr Emam

last update on 15 Oct 2024

Saudi Crown Prince Mohammed bin Salman kicked off a visit to Cairo on Tuesday, 15 October—his first to the Egyptian capital in over two years—where he met with Egyptian President Abdel Fattah el-Sisi.

The two leaders agreed on a wide range of regional issues— particularly the wars in Gaza and Lebanon— and reiterated the need for establishing an independent and sovereign Palestinian state and ending the ongoing hostilities between Hamas and Israel. For his part, el-Sisi has made repeated calls for an independent Palestinian state in the past months, while last month, Saudi Foreign Minister Faisal bin Farhan announced the formation of the Global Alliance for the Implementation of the Two-State Solution.

However, the feasibility of a Palestinian state looks bleak amid the mushrooming Israeli settlement presence swallowing up large swaths of the occupied West Bank and Israel's war on Gaza, leaving the 360 square kilometre coastal territory in near-complete ruin.

Omar AL-QATTAA / AFP) — A view of the destruction by the Israeli military of Beit Lahia, in the northern Gaza Strip on July 29, 2024.

Internal Palestinian divisions also slow down the realisation of a Palestinian state. Earlier this month, Cairo convened a meeting of Palestinian factions in an attempt to find a way out of the current crisis in Gaza and the West Bank and to come up with a unified vision for 'the day after' in Gaza.

Palestinian unity would be essential to any negotiations to push for a Palestinian state as Israel not only drags its feet but is actively trying to bury any hope for statehood once and for all. By making Gaza unfit for living and life more difficult in the West Bank, Israel is hoping Palestinians will leave their lands and be absorbed into neighbouring countries (Egypt and Jordan, among others).

Meanwhile, Israel has expanded its war aims beyond Gaza and toward eliminating all threats against it, including groups like Hezbollah in Lebanon and the Houthis in Yemen, who are attacking international shipping in the Red Sea to make Israel and its Western backers pay a price for the ongoing war on Gaza.

The first shock to Egypt's economy was triggered by the war in Ukraine and then by Israel's war on Gaza

This issue was also discussed in the leaders' talks. Oil-producing Gulf nations have been economically hurt by Houthi attacks on the southern entrance to the Red Sea and the Bab el-Mandab Strait, which are important pathways for their oil exports. For its part, Egypt is also suffering economically. The Suez Canal has seen an almost 60% drop in revenue because international maritime lines are afraid to sail through the Red Sea waterway.

A senior Houthi official has already vowed to step up attacks against ships affiliated with Israel and the US off the coast of Yemen, and the group is expected to soon receive Russian anti-ship P-800 missiles, widely known as Oniks or Yakhont, through Iran, which will help it in its Red Sea campaign.

AFP — A Houthi helicopter flies over the cargo ship Galaxy Leader as Houthi fighters walk on the deck of the ship in the Red Sea, on 20 November 2023.

Investment opportunities

The two leaders also discussed investment opportunities. Following their talks, they signed an agreement to protect mutual investments and set up the Supreme Egyptian-Saudi Coordination Council to oversee matters.

They hope to capitalise on their close political ties to boost economic cooperation. Saudi Arabia has already invested close to $30bn in Egypt, and over 800 Saudi companies operate in different sectors of the Egyptian economy. In mid-September this year, the Saudi crown prince directed Saudi Arabia's Public Investment Fund to invest an initial $5bn in Egypt.

Cairo is looking for investments in its Red Sea coast, trying to mirror a major investment deal inked with the UAE in February for a tourist-residential resort in Ras El-Hikma on Egypt's Mediterranean coast.

The prospects for economic cooperation between the two regional powerhouses come at a time when Egypt is working hard to attract foreign investments to address its financial problems and create jobs for its people, as its economy is in dire economic straits.

The first shock to Egypt's economy was triggered by the war in Ukraine and then by Israel's war on Gaza and its ripple effect on the region. As a result, Egypt's economy has been in a downward spiral to the point where it was left with little choice but to request a bailout from international crediting organisations, including the International Monetary Fund.

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