With Al Qaeda’s presence growing in the Sinai, Egypt and Israel have stepped up joint bilateral security cooperation to deal with the threat. Amidst the turmoil that has ensued throughout post-Mubarak Egypt, Al Qaeda (AQ) has established a stronghold in the Sinai from where jihadists routinely target Egypt and Israel. In turn, Egyptian and Israeli security forces have increased cooperation to address Sinai’s security challenges, underscoring that the bilateral relationship remains intact. While in the longer term the direction of bilateral relations remains uncertain, in the near term Al Qaeda’s actions have strengthened security ties between Egypt and Israel. Al Qaeda’s actions in the Sinai and Levant have also served to enhance the likelihood that other governments in the region, such as Jordan and Turkey, will continue to cooperate with Israel on security-related issues.

An ‘Islamic Emirate’ between Egypt and Israel

Since Israel’s withdrawal from Egyptian territory in 1982, the Sinai has proven to be Egypt’s most ungovernable territory. The Mahahith Amn al-Dawla (MAD) — the highest internal security authority in Egypt — was responsible for ensuring law and order in the restive Sinai and cracking down on underground Islamist movements. Throughout Mubarak’s rule, the MAD prevented Islamist militants from successfully launching more than only a few attacks across the Egyptian-Israeli border. However, Mubarak’s fall led to the MAD’s dissolution, raising the question about the Egyptian government’s capacity to effectively combat militant jihadist forces.

A power vacuum subsequently formed in the Sinai, which criminal and terrorist organizations were quick to exploit. With the endorsement of Ayman al-Zawahiri, militants sabotaged Egypt’s pipeline transferring natural gas to Israel and Jordan 19 times over the past three years. Since the military removed Egypt’s Muslim Brotherhood from power during last year’s coup, attacks against the Egyptian military and police in the Sinai have been waged with greater frequency.

The most influential Sinai-based AQ-linked group is Ansar Beit al-Maqdis — often referred to as Ansar al-Jerusalem (or “Defenders of Jerusalem”). Three other AQ-affiliate groups active in the Sinai include the Mujahideen Shura Council, Takfir wal-Hijra, and Jaish al-Islam. Many of these groups include local Bedouin tribesmen and other Egyptian Salafists who previously belonged to al-Gama’a al-Islamiyya and Egyptian Islamic Jihad. Foreign jihadists – from Algeria, Central Asia, Libya, Morocco, Palestine, Russia, Saudi Arabia, Somalia, Sudan, Tunisia, and Yemen — have also joined their ranks, underscoring how the Sinai has become a hub for global jihadists.

While overthrowing Egypt’s military-backed secular government and installing a Salafist theocracy is the most frequently stated objective of AQ in Egypt, such militants intend to wage a two-front war that also targets Israel. Given the international mix of fighters — and their transnational agendas — the Sinai crisis is not only an issue of great concern to the Egyptian government, but to many of the region’s governments.

How Al Qaeda grew in the Sinai

Three domestic and regional developments have fueled AQ’s presence in the Sinai. First, the historically neglected Bedouin community’s standard of living prompted certain elements within the tribes to embrace jihadist currents in the Sinai. Some Bedouin tribal factions viewed AQ militants as a force that could effectively counter Egyptian security forces, pressuring the state to withdraw from the Sinai. In this sense, AQ has scored soft-power gains in the Sinai, playing off the legacy of the Egyptian state’s human rights abuses and economic neglect of the local tribes. Second, Libya’s civil war of 2011 resulted in loose arms caches spilling into jihadist hands in the Sinai and other volatile parts of Africa, most notably Mali. A year ago, Egyptian authorities announced the seizure of trucks containing 60 anti-tank missiles en route from Libya to the Sinai. The flow of loose Libyan arms across Africa and the Middle East has posed a growing challenge for many governments.

Third, Hamas’ rise to power in Gaza during 2006/2007 — and the group’s embrace of more pragmatic/democratic political strategies — alienated many hardline members and resulted in the more rigid and extremist currents leaving Hamas to join the ranks of AQ-linked Palestinian factions in Gaza. A number of these Gazan Salafists relocated to the Sinai, both due to Hamas-led crackdowns and strategic interests, from where they sought to wage violent jihad against Israel. Taken together, these three trends create a volatile mix of challenges for Egypt’s government to grapple with, at a time when its list of dilemmas seems to grow by the day. When combined with the political, economic, and socio-cultural issues at play, Egypt is at risk of becoming a failed state – something which seemed unthinkable just three years ago.

The Resilient Washington/Jerusalem/Cairo Axis

Following the coup, the Egyptian military deployed thousands of troops across the Suez Canal for the first time since the 1973 Arab-Israeli war. While this exceeded the limitations of the 1979 peace treaty, Israel supported Cairo’s militarization of the Sinai as it was understood as the most effective way to counter the jihadist insurgents whose guns were pointed at both countries. What was also highlighted was the reality of a new environment in which non-state actors in Egypt (not the Egyptian military) pose the gravest security threat to Israel. It is within this context that Israel’s government was one of the most outspoken defenders of the military-backed interim government before the international community, lobbying Western states to continue to provide Cairo with foreign aid. This marked a paradigm shift from the days of Kissinger’s shuttle diplomacy, during which several U.S. administrations lobbied Israel to trust the Egyptian military.

It is doubtful that AQ will drive out the Egyptian military and create an Islamic Emirate along the coast of the northern Sinai. By the same token, it is also unlikely that Egypt’s military will be entirely successful in removing AQ’s presence in the area. AQ may well prove capable of continuing to expand its insurgency beyond the Sinai however, attacking strategic infrastructure and public institutions elsewhere in Egypt. Doing so on a sustained basis will further threaten Egypt’s tourism industry, which has suffered tremendously since 2011. Given that Israel’s southern-most city of Eliat has been targeted by Sinai-based jihadist groups, both countries’ tourism industries stand to be the losers from an emboldened AQ presence in the Sinai.

Within this context, Egypt and Israel have every reason to continue to enhance cooperative security measures. It should be noted that even though Washington decreased aid to Egypt in the aftermath of the military’s oppressive crackdown on political dissent, its aid for counter-terrorism operations in the Sinai has remained in place. Clearly, Washington is content to selectively support the Egyptian military’s heavy-handed use of force when it suits the security interests of Israel and other U.S. allies in the region.

If an emboldened AQ presence in the Sinai leads to further attacks against Israel, it is entirely possible that Israel will take unilateral action. In early August 2013, an Israeli drone strike may have killed five Ansar Beit al-Maqdis members near Rafah, Egypt (situated along the Egypt-Gaza border). If such actions are repeated, authorities in Cairo will need to carefully balance cooperation with Israel and public sentiment in Egypt, given the widespread hostility toward Israel among Egyptian citizens. Egypt’s government obviously cannot be perceived as overtly complicit in Israeli actions that may violate Egyptian sovereignty.

While a retired Egyptian Army Major General wrote last October that Israeli annexation of the Egyptian Sinai amidst the military’s conflict with its Islamist enemies was within the realm of possibility, Israel has stated its intention of respecting Egyptian sovereignty and understands its vested interest in maintaining the peace with Cairo. It remains to be seen the degree to which the two states will respect each other’s sovereignty while pursuing joint-military efforts to combat AQ.

For now, Egyptian and Israeli officials understand that neither state would benefit from a confrontational stance toward the other, given the overlapping security dilemmas. Conflicts of interest between Cairo and Jerusalem appear to have taken a back seat to their mutually-held objectives of countering AQ’s presence in the Sinai. Thus, AQ’s new position in the Sinai is not only that of a magnet for jihadists, but also a magnet for state cooperation in countering the group. Ironically, AQ’s growing strength in the Sinai has contributed to the strengthening of the Washington-Jerusalem-Cairo axis that has served as a key pillar of U.S. foreign policy in the Middle East for several decades. The more things change, the more they remain the same.