Politics

Egypt's post-October 7 balancing act

While Cairo felt that the Hamas attacks on Israel were a response to occupation, it does not see eye-to-eye with the group. It also has practical worries, not least of which are economic.

Al Majalla

Egypt's post-October 7 balancing act

Amr Emam

last update on 08 Oct 2025

Egypt saw the October 7 2023, attack against Israel as a symptom of occupation, rather than one of unprovoked terror. Notably, Cairo never explicitly condemned Hamas, and its foreign ministry was careful to describe them as a “Palestinian response”.

This not only reflected Egypt’s sympathy for the Palestinian cause but its desire to de-escalate the situation. But above all, Egypt's concerns over Gaza are more pragmatic in nature. In fact, it warned Israel about a potential Hamas operation, underscoring its desire for peace, not war. And while Tel Aviv denies it had been warned, US sources seem to back Cairo's claim.

Egypt’s worry has long been that the outbreak of war could spread to other parts of the region. It didn't want to get drawn into a conflict, given the inevitable effects on security in Sinai—the peninsula that borders both Gaza and Israel. Its fears materialised, however, with a massive Israeli military response lasting two years, killing almost 70,000 Gazans, and leaving the enclave in ruins.

Fearing an exodus

Nearly all of Gaza’s 2.3 million people have been displaced, so far only within the Strip. Egypt has repeatedly rejected any mass displacement of Palestinians into Sinai as a threat to its national security— something Israeli officials have openly called for.

AFP — An Israeli tank in the southern Gaza Strip can be seen while thousands of Palestinians flee their homes towards the city of Rafah.

Egyptian President Abdel Fattah el-Sisi said such an influx would destabilise the country, which already faces significant economic problems. Such a displacement could also imperil the 1979 Egypt-Israel Peace Treaty, he added.

Displacement fears have prompted Egyptian security reinforcements in Sinai, in what the Israelis felt was a breach of the 1979 Treaty’s Security Annex. It also strained relations between Cairo and Washington, especially after US President Donald Trump mused in February that Gaza could become a “Middle East Riviera” while asking Egypt and Jordan to take its people in.

Cairo has fought hard over the decades to maintain sovereignty over the Sinai—first against Israeli occupation, then against Islamist militants—so the mass exodus of Palestinians into the territory has been fiercely rejected.

Cairo has fought long and hard to maintain sovereignty over the Sinai, which is why it has fiercely rejected the suggestion of "transferring" Gaza's population there

Additionally, there are long-standing and deeply held animosities between Cairo and Hamas, which Egypt sees as an ideological offshoot of the Muslim Brotherhood (outlawed since 2013), and while Egypt supports Palestinian resistance more broadly, it is wary of Hamas's militancy, especially after the 2004 Sinai bombings (linked to Brotherhood-affiliated groups) and a 2008 breach of the Sinai-Gaza border by Hamas operatives.

Since the October 7 attacks, Cairo has worked tirelessly for a ceasefire. Having initially proposed a committee of Palestinian technocrats to rule Gaza, it now backs President Trump's plan for Gaza's political and administrative future after the withdrawal of Israeli troops.

Feeling the pain

The economic fallout of October 7 2023, only adds to Egypt's economic problems, not least by threatening its tourism sector, which contributes 13% of GDP (gross domestic product) and employs more than one in ten Egyptians.

The targeting of Israeli-linked commercial shipping in the Red Sea by the Houthis in Yemen has also diverted traffic from the Suez Canal, depriving Egypt of a vital source of US dollars in the form of transit fees. Combined, this has left Cairo scrambling for alternative financing, including through borrowing from international organisations and from the sale of state-owned assets.

Mariusz Bugno/Shutterstock — A tug boat approaching the city of Tawfiq at the southern end of the Suez Canal before exiting into the Red Sea on August 25, 2021.

On a more fundamental level, Egypt is concerned that the war in Gaza since October 2023 has jeopardised prospects for a two-state solution. President Sisi advised Gaza's residents not to leave their land because departures would effectively be a one-way ticket. He and others sense that Israel's far-right government sees, in its response to the attacks, a chance to finally end hopes for a Palestinian state once and for all.

This has been further evidenced by Israel's expanded settlement construction in the occupied West Bank and its plans to resettle Gaza, moves that would render any Palestinian state unviable. Like other countries, Egypt envisions an independent Palestinian state alongside the State of Israel, based on pre-1967 borders, with East Jerusalem as the Palestinian capital. It also sees the unresolved conflict as a driver of regional instability.

By advocating for a two-state solution, Egypt maintains credibility with both Western allies and Arab states, allowing it to facilitate negotiations, such as those currently being held in Sharm el-Sheikh over the implementation of President Trump's plan for Gaza.

Egypt's role in the Arab-Israeli wars of 1948, 1967, and 1973 ties its identity to the Palestinian cause. Supporting a Palestinian state fulfils this legacy without endorsing the tactics of Hamas.

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