Non-Alignment in a New Age

Egypt, the Belt and Road Initiative, and the War in Ukraine

by Kevin Clenard edited by Gideon Gordon and Ava Rheeve

reviewed by AMBASSADOR JORGE HEINE

In the dawn of what political science scholars have called a ‘Second Cold War’ with the rise of China and the current hot war between Russia and Ukraine, states in the Global South have once again found themselves caught in the midst of a struggle between two competing power blocs. 1 In a repeat of history, a third path seems increasingly favorable for these states: Active Non-Alignment. Much like the original Non-Aligned Movement founded in 1961 by key leaders in the Global South who sought to avoid entanglement in the Cold War, today states can choose to remain politically in between the U.S., Russia, and China in an age of new divisions. While literature on current nonalignment has flourished regarding Latin America, Asia, and sub-Saharan Africa, there has been little focus on its resurgence in states in the Middle East and North Africa (MENA) region, including Egypt. 2

Great power competition has once again become a key feature of Egyptian foreign policy issues, as the country is endowed with a central strategic location astride the vital Suez Canal trade route, as well as economic and historical importance to both blocs. Previously considered a strong U.S. ally in the region since its role in brokering the 1979 Camp David Accords, Egypt has been diversifying its economic and political ties recently via China’s Belt and Road Initiative (BRI), increased investment from Europe, and greater trade with Russia. Such a shift in policy is likely a consequence of the recent reduction in political support and investment from the United States due to American concerns over Egypt’s foreign and domestic policies. Sitting on a line of great power division between American, Chinese, and Russian influences, non-alignment offers Egypt greater opportunities for economic development and domestic stability through increased autonomy.

Starting in the 1950s with the collapse of colonialism and the emergence of the Cold War, formerly colonized countries began to challenge the emerging division between competing great powers, the United States and the Soviet Union. Many sought to maintain their newly found independence by refusing to constrict their foreign policy to support for one side or the other.3 As one leader of the Non-Aligned Movement, Egyptian President Gamal Abdel Nasser advocated for pan-Arab and pan-African unity with “techniques of remaining independent from the great powers and, if necessary, playing one off against the other.”4

It is worth noting that non-alignment is not the same as neutrality. According to Ambassador Jorge Heine, a leading scholar on Global South politics, neutrality, “by definition, entails an unwillingness to take positions on international matters.”5 On the other hand, Active Non-Alignment (ANA) refers to, “a refusal to align automatically with one or another of the major powers. It means that governments will put their own national interests front and center, rather than those of foreign powers.”6 Egypt has exemplified such non-alignment, both in the twentieth century and in the modern day. Although the country is still considered a regional security and diplomatic ally of the United States, Egypt has been gradually orienting its economy towards China, and has taken a hesitant stance on the recent war in Ukraine due to economic ties with Russia.

America in Egypt: Waning Influence

Over the past decade, Egypt has courted the U.S. for both political support and military investment, touting itself as a key regional leader in the War on Terror and multilateral peacemaking efforts.7 For instance, Egypt has received approximately $1.3 billion annually from the U.S. Federal Military Financing program since 1987 as a reward for promoting peace with Israel, particularly with regard to its role in the 1979 Camp David Accords and continued brokering of the Gaza ceasefire between Israel and Hamas.8 This makes Egypt “the second largest recipient of American military aid, after Israel.”9

However, since the nominal amount of aid Egypt receives from the U.S. has remained relatively unchanged since 1987, Egypt has struggled to afford new American military equipment in the face of inflation and pricey technological advances. In response, the country has turned to alternative sources for weapons.10 Between 2000 and 2009, Egypt imported about 75 percent of its weapons from the United States, yet in the following decade, arms imports from the U.S. only measured 23 percent of the total, with Russia and France taking the top spots.11 Egypt then became the third largest arms importer in the world and one of the most diversified countries in the MENA region in terms of arms suppliers and military equipment/defense procurement.12 Such a drastic shift away from a near U.S. monopoly on Egypt’s arms imports exemplifies Egypt’s economic and defensive non-alignment by breaking exclusivity in favor of better deals elsewhere. This has not gone unnoticed by the American government. In response to a $24 billion arms purchase from North Korea in January 2016, the Trump Administration withheld $65.7 million from Egypt’s yearly aid package, citing human rights concerns regarding the prosecution of Egyptian NGO workers for operating without government approval.13 Additionally, since prior to the Russia-Ukraine War, Egypt has risked substantial economic sanctions under the 2017 Countering America’s Adversaries Through Sanctions Act if the country commits to purchasing Russian jets.14 More recently, since 2019, members of U.S. Congress have pushed to withhold military aid from the Egyptian government over alleged human rights abuses, leading to President Biden’s decision to reprogram $130 million initially meant for Egypt’s military.15 In the words of U.S. General Frank McKenzie, “Compared to the amount of other money that’s in play, it’s a very small amount. But I think it’s intended to be a signal…We still have a very robust weapons program with Egypt and we're still very heavily engaged with them.”16 Symbolically, the American aid reprogramming marks a significant public challenge to U.S.-Egypt relations. In this case, Washington has demonstrated that it is serious about clamping down on what it considers unsavory Egyptian domestic policies.

In addition, the U.S. still maintains significant economic and political influence over Egypt through the International Monetary Fund (IMF). As of July 2022, the state’s public debt has reached 94 percent of its GDP, a condition the IMF has repeatedly attempted to mend by making loans to Egypt that are conditional upon the country’s commitment to free-market reform.17 This conditionality has strained Egypt-IMF relations, compounding existing mistrust from previous imperial financial control.18 That being said, Egypt has already received three loans since 2016 totaling over $20 billion and has requested further funds in March 2023 to mitigate the effects of the war in Ukraine.19 Yet, according to MENA scholar Michaël Tanchum, these loans come “with the stipulation that [Egypt] cuts spend- ing on food and fuel subsidies, changes that successive Egyptian governments have been slow to make because of fear of igniting popular unrest,” particularly since the 1977 ‘Bread Riots.’20

Reliance on a U.S.-led institution— such as the IMF—limits Egypt’s autonomy by granting the U.S. significant say in Egypt’s finances.21 Empirical analysis reveals that “movement toward the United States within a defined international political space (like that measured by U.N. voting patterns) can significantly increase a country’s chances of receiving a loan from the IMF.”22 Using channels such as the IMF, Washington focuses primarily on pulling states into its sphere of influence and punishing those who defect, rather than rewarding those consistently loyal to the U.S.23 In doing so, countries with already stronger ties to the U.S. see relatively little rewards for their dedication besides not receiving any punishment through institutional proxies. This explains a trend seen throughout the Global South, wherein wealthy countries’ near absolute control over developing states’ economic institutions have resulted in the degradation of labor rights and environmental regulations in favor of wealthy business ventures.24 Hence, through IMF loans, the U.S. infringes upon Egyptian sovereignty while offering little reward for Egypt’s loyalty in return.

A similar trend in Western political influence through Bretton Woods institutions is also seen in the World Bank’s responses to Chinese foreign aid in Egypt. Empirical evidence reveals that “there might be some limited punishment or signaling of disapproval for recipients of Chinese aid, suggesting some degree of the World Bank serving as a proxy for U.S. power.”25 Preliminary evidence demonstrates that loan conditions for countries throughout Africa worsen in relation to Chinese aid received, while the same countries are more likely to receive full debt cancellation if Chinese aid is minimal or nonexistent.26 Ultimately, analysis of the IMF and World Bank reveals an intention on the part of the U.S. to exploit such institutions in pursuit of American interests, thus threatening Egypt with economic damage if the country cultivates ties to American adversaries like Russia and China.

The Rise of China and a New Silk Road

As the U.S. has become an increasingly difficult partner to work with, China has presented a valuable alternative for Egypt, particularly in the past decade with the advent of the Belt and Road Initiative.27 However, the origins of Sino-Egyptian relations date to the mid twentieth century, when “Egypt was the first Arab and African country to establish direct diplomatic relations with China in 1956.”28 Egypt was also the first recipient of a Chinese foreign grant, receiving $4.5 million during the Suez Crisis.29 Since then, China has gained significant influence throughout the Middle East and North Africa, thanks to a non-interventionist doctrine coupled with a lack of colonialist history in the region.30 This stands in sharp contrast to the frequent American military interventions that have defined US-MENA policy for over two decades.31 As political scientist Mojtaba Mahdavi of the University of Alberta explains it, “MENA’s unique geostrategic location–a trade hub linking three continents–is of great interest to China, and [China’s] respect for state sovereignty and the non-intervention policy seem to work for both sides.”32

Indeed, China and Egypt have found general agreement on regional policy. Both have committed to a joint communique focusing on economic development and investment to promote stability in the Global South.33 Years after Nasser’s Aswan Dam, Egypt has once more embarked on foreign-funded mega projects, including a high-speed rail line from the Germans and a nuclear power plant from the Russians.34 However, China has taken a prominent lead in these ventures. 35 Most notably, the Chinese State Construction and Engineering Company has a principal role in building Egypt’s new administrative capital outside of Cairo, funding about 80 percent of the $3 billion cost for its central business district.36

China is also the largest investor in the Suez Canal industrial zone, and has actively invested in key Egyptian ports, railway networks, and renewable energy–especially solar under Egypt’s Integrated Sustainable Energy Strategy.37 The latter investment has assisted Egypt significantly in shifting from a nation with chronic energy shortages to one with a surplus which it can now export.38 These Belt and Road Initiative programs boost Egypt’s political and economic status, providing welcome infrastructure for long-run development, an appealing prospect compared to the American model of economic coercion.

U.S.-China competition in Egypt has also influenced the Egyptian arms trade and development banks. In 2018, Egypt made a deal to purchase Chinese drones for their air force, along with a loan agreement for $600 million from the China Develop- ment Bank.39 Although both the purchase and the loan agreement were relatively small, this partnership has ultimately proved quite beneficial to Egypt in opening the door for further diversification of Egyptian relations beyond US-led institutions. China’s policy of non-intervention and their willingness to support development on a more equal footing has made China significantly more attractive to Egypt as a partner, drawing the country further away from the United States.

Russia and the War in Ukraine: A Different Stance

Russia’s war in Ukraine has exacerbated great-power tensions, placing Global South countries in a precarious position due to ties to both blocs. On February 24, 2022, Egypt embraced ambiguity with an initial call for Russia and Ukraine to end the conflict by “following a diplomatic path.”40 However, in response to pressure from the West (particularly the G7 and the EU), Egypt joined a statement on March 1, 2022, declaring support for Ukraine. Shortly thereafter, Egypt voted in the UN General Assembly on March 2, 2022 condemning the invasion and demanding that Russian troops withdraw from Ukraine.41

Egypt’s initial hesitancy to publicly condemn Russia’s actions likely stems from the country’s strengthening its military ties with Russia in recent years, as well as its reliance on Russian trade to feed its domestic population.42 Egypt is the world’s largest importer of wheat and a top-ten importer of sunflower oil, with 85 percent of the former and 73 percent of the latter coming from Russia and Ukraine.43 Michaël Tanchum notes that bread “is a staple of every meal among the country’s poor…Keeping the price of Egypt's staple food affordable has been the bedrock of regime stability since the Free Officers revolution brought then-President Gamal Abdel Nasser to power 60 years ago.”44 A harsher Egyptian stance promoting retribution for Russia due to its belligerence could compound Egypt’s preexisting food insecurity in light of decreased Ukrainian exports from the war.

On the other hand, the Russia-Ukraine war also presents potential economic benefits in terms of Egypt’s relations with Western Europe. The Arab state is currently Africa’s third largest producer of natural gas, and although the move to renewable energy has sparked concerns that this sector will soon decline, the risk that the war in Ukraine may cut Europe’s gas supply from Russia has heightened European demand for natural gas imports.45 Subsequently, Egypt has seen a sharp rise in demand for its own natural gas supply, resulting in a recent deal whereby Egypt and Israel have both agreed to boost exports to Europe in order to prevent widespread freezing in the coming winter.46 By taking a stance in non-alignment that balances both Russia and the West in the War in Ukraine, Egypt is able to mitigate a potential food crisis while also gaining economically in the market for natural gas.

Conclusion

Egypt’s position as a longtime U.S. ally has shifted in recent years as the country has reemerged as a practitioner of non-alignment via increased ties with China and Russia and a deliberate distancing from Western influence. Through dealing with countries outside the Western bloc, Egypt is able to better guarantee its own interests with beneficial trade deals, rewarding investments, and minimized political exploitation from Western-led international financial institutions. Much like in its past, Egypt’s position at the threshold between multiple regions and their competing interests makes non-alignment a sound method of both cementing peace and stability in Egypt, and increasing economic welfare by refusing to put all its eggs in the American basket. Due to consistent Great Power interest in the region, other MENA countries might consider following suit in adopting a policy of Active Non-Alignment to balance foreign influences and therefore secure further growth both economically and politically.

References

1 Carlos Fortín, Jorge Heine, and Carlos Ominami P., eds., El no alineamiento activo y América Latina: una doctrina para el nuevo siglo, Primera edición (Santiago, Chile: Catalonia, 2021); Non-Alignment 2.0, vol. 21 (Beijing, China: Taihei Institute Observer, 2022), http://www.taiheglobal.org/Content/2022/06-30/1115477342.html.

2 Carlos Fortín, Jorge Heine, and Carlos Ominami P., eds., El no alineamiento activo y América Latina: una doctrina para el nuevo siglo, Primera edición (Santiago, Chile: Catalonia, 2021); Non-Alignment 2.0, vol. 21 (Beijing, China: Taihei Institute Observer, 2022), http://www.taiheglobal.org/ Content/2022/06-30/1115477342.html.

3 “History and Evolution of Non-Aligned Movement,” Government of India Ministry of External Affairs, accessed October 1, 2022, https://mea.gov.in/in-focus-article.htm?20349/History+and+Evolution+of+NonAligned+Movement.

4 Peter Mansfield, “Nasser and Nasserism,” International Journal 28, no. 4 (1973): 676, https://doi.org/10.2307/40201172.

5 Jorge Heine, “The War in Ukraine and the Active Non-Alignment Option,” Taihe Institute Observer 21 (June 2022): 4–5.

6 Heine, 4–5.

7 Jeremy M. Sharp, “Egypt: Background and US Relations” (Congressional Research Service, July 13, 2022), 9–12, https:// sgp.fas.org/crs/mideast/RL33003.pdf.

8 Sahar Khamis, “Agreements and Tensions in US-Egyptian Relations,” Arab Center Washington DC, December 2, 2021, https:// arabcenterdc.org/resource/agreements-and-tensions-in-us-egyptian-relations/; Sharp, “Egypt: Background and US Relations,” 4.

9 Khamis, “Agreements and Tensions in US-Egyptian Relations.”

10 Sharp, “Egypt: Background and US Relations,” 4.

11 Marina Ottaway, “Egypt and the Allure of Military Power | Wilson Center,” accessed October 1, 2022, https://www.wilsoncenter.org/article/egypt-and-allure-military-power.

12 Ottaway; Thomas Clayton et al., “Arms Sales in the Middle East: Trends and Analytical Perspectives for U.S. Policy,” n.d., 15.

13 Sharp, “Egypt: Background and US Relations,” 11; Declan Walsh, “Need a North Korean Missile? Call the Cairo Embassy,”

The New York Times, March 3, 2018, sec. World, https://www. nytimes.com/2018/03/03/world/middleeast/egypt-north-koreasanctions-arms-dealing.html; Amina Ismail and Haitham Ahmed, “Egyptian Court Acquits 40 NGO Workers Whose Case Strained Ties with U.S.,” Reuters, December 20, 2018, sec. Emerging Markets, https://www.reuters.com/article/us-egypt-usa-idUSKCN1OJ0WR.

14 Sharp, “Egypt: Background and US Relations,” 7–8.

15 Siobhan O’Grady, “Biden Administration Set to Withhold $130 Million from Egypt over Human Rights Concerns,” Washington Post, accessed October 2, 2022, https://www.washingtonpost.com/world/2022/01/28/egypt-human-rights-military-aid/; U. S. Mission Egypt, “EGYPT 2021 HUMAN RIGHTS REPORT,” U.S. Embassy in Egypt, July 17, 2022, https://eg.usembassy.gov/ egypt-2021-human-rights-report/.

16 Phil Stewart and Aidan Lewis, “American General in Egypt for Talks after U.S. Cuts Military Aid,” Reuters, February 9, 2022, sec. World, https://www.reuters.com/world/american-general-egypt-talks-after-us-cuts-military-aid-2022-02-09/.

17 Sharp, “Egypt: Background and US Relations,” 24; Michaël Tanchum, “The Russia-Ukraine War Has Turned Egypt’s Food Crisis into an Existential Threat to the Economy,” Middle East Institute, March 3, 2022, https://www.mei.edu/publications/russia-ukraine-war-has-turned-egypts-food-crisis-existential-threateconomy; Steven A. Cook, “Egypt and the IMF: It’s Complicated,” Council on Foreign Relations, September 10, 2012, https:// www.cfr.org/blog/egypt-and-imf-its-complicated.

18 Sharp, “Egypt: Background and US Relations,” 24; Tanchum, “The Russia-Ukraine War Has Turned Egypt’s Food Crisis into an Existential Threat to the Economy”; Cook, “Egypt and the IMF.”

19 “IMF: Prioritize Social Protection in Egypt Loan Talks,” Human Rights Watch (blog), April 4, 2022, https://www. hrw.org/news/2022/04/04/imf-prioritize-social-protection-egypt-loan-talks.

20 Sharp, “Egypt: Background and US Relations,” 24; Tanchum, “The Russia-Ukraine War Has Turned Egypt’s Food Crisis into an Existential Threat to the Economy.”

21 Strom C. Thacker, “The High Politics of IMF Lending,” World Politics 52, no. 1 (1999): 41–42.

22 Thacker, 67–69.

23 Ibid.

24 Jason Hickel et al., “Imperialist Appropriation in the World Economy: Drain from the Global South through Unequal Exchange, 1990–2015,” Global Environmental Change 73 (March 1, 2022): 9, https://doi.org/10.1016/j.gloenvcha.2022.102467.

25 Anne Malin Marie Schuemann, “World Bank Reactions to

Chinese Aid in Africa: A Story of Great Power Competition?,” June 2022, 40–41, https://knowledge.uchicago.edu/record/3769/ files/Schuemann%20Thesis%2C%20CIR%2C%20June%202022. pdf.

26 Schuemann, 40–41.

27 Thacker, “The High Politics of IMF Lending”; Schuemann, “World Bank Reactions to Chinese Aid in Africa: A Story of Great Power Competition?”; Hickel et al., “Imperialist Appropriation in the World Economy: Drain from the Global South through Unequal Exchange, 1990–2015.”

28 Mohamed El Dahshan, “Egyptian Exceptionalism in a Chinese-Led World,” Chatham House – International Affairs Think Tank, February 10, 2021, https://www.chathamhouse. org/2021/02/egyptian-exceptionalism-chinese-led-world.

29 El Dahshan.

30 Mojtaba Mahdavi, The Triple Pillar of Sino–MENA Relations in the Age of Neoliberalism (Brill, 2022), 18, https://doi. org/10.1163/9789004510005_003.

31 Mahdavi, 18.

32 Ibid.

33 Yossra M. Taha, Sino–Egyptian Relations and the New Regional Dynamics of the Middle East (Brill, 2022), 224, https://doi. org/10.1163/9789004510005_013.

34 Sean Mathews, “The Competition for Egypt: China, the West, and Megaprojects,” accessed September 1, 2022, https://www. aljazeera.com/news/2021/3/15/the-competition-for-egypt-chinathe-west-and-mega-projects.

35 Ibid.

36 Ibid.

37 Mathews; John Calabrese, “Towering Ambitions: Egypt and China Building for the Future,” Middle East Institute, accessed September 1, 2022, https://www.mei.edu/publications/towering-ambitions-egypt-and-china-building-future.

38 Mathews, “The Competition for Egypt”; Calabrese, “Towering Ambitions.”

39 Taha, Sino–Egyptian Relations and the New Regional Dynamics of the Middle East, 225.

40 “Egypt Calls for Diplomatic Solution for Russian-Ukrainian Crisis,” State Information Service, February 24, 2022, https:// www.sis.gov.eg/Story/163585?lang=en-us.

41 Khalil Al-Anani, “Russia’s War on Ukraine: Egypt’s Limited Room for Maneuver,” Arab Center Washington DC, April 6, 2022, https://arabcenterdc.org/resource/russias-war-on-ukraineegypts-limited-room-for-maneuver/.

42 Khalil Al-Anani, “Growing Relations between Egypt and Russia: Strategic Alliance or Marriage of Convenience?,” Arab Center Washington DC, September 27, 2021, https://arabcenterdc.org/ resource/growing-relations-between-egypt-and-russia-strategic-alliance-or-marriage-of-convenience/.

43 Tanchum, “The Russia-Ukraine War Has Turned Egypt’s Food Crisis into an Existential Threat to the Economy.”

44 Ibid.

45 Rehab R. Esily et al., “The Potential Role of Egypt as a Natural Gas Supplier: A Review,” Energy Reports 8 (November 2022): 6826–36, https://doi.org/10.1016/j.egyr.2022.05.034.

46 Sarah El Safty and Ari Rabinovitch, “EU, Israel and Egypt Sign Deal to Boost East Med Gas Exports to Europe,” Reuters, June 15, 2022, sec. Energy, https://www.reuters.com/business/ energy/eu-israel-egypt-sign-deal-boost-east-med-gas-exports-europe-2022-06-15/.

Maps by: Sam Wu