Ethan Bronner
The New York Times (Analysis)
August 26, 2011 - 12:00am

JERUSALEM — Eight days after Israel suffered a terrorist attack from Egyptian Sinai and weeks before it faces a Palestinian statehood resolution at the United Nations, its officials say they are struggling with a painful set of strategic and diplomatic challenges produced by the region’s popular uprisings.

As angry rallies by Egyptians outside the Israeli Embassy in Cairo this week have shown, Israel’s relationship with Egypt is fraying. A deadly exchange of rockets fired at southern Israel and Israeli airstrikes on Hamas-controlled Gaza this week showed the risk of escalation there. Damaged ties with Turkey are not improving. Cooperation with the Palestinian Authority in the West Bank seems headed for trouble.

“We are witnessing a paradigm shift in front of our eyes,” said a top Israeli official who spoke on the condition of anonymity. “Egypt was a major stabilizer in the region, and that may be over. Coordination with the Palestinian security officials could be lost. We are concerned about Turkey.”

Israeli officials say they are certain from detailed intelligence that the Aug. 18 infiltration that killed eight Israelis was planned and carried out from Gaza by Palestinians associated with a small radical group. But in its pursuit of the killers into Sinai and its assassinations of the group’s leaders in Gaza, Israel found itself with less room to maneuver than in the past.

Last weekend, officials were contemplating a major military assault on Gaza. But that plan was shelved by the crisis that emerged with Egypt, by the realization that Hamas itself was uninvolved in the terrorist attack and by the worry about how such an assault would affect other countries’ views during the United Nations debate of a Palestinian resolution in September.

Instead, Prime Minister Benjamin Netanyahu and his most senior ministers decided over the course of several late-night meetings this week to promote cooperation with Egypt and restrict military action in Gaza to more limited strikes. Scores of rockets have hit Israel; dozens of Gazans have been killed and injured.

The Israelis say their challenge is that they needed to send different — indeed contradictory — messages to different audiences.

To groups they say have attacked Israel from Gaza and Sinai, their message was death. To the interim military rulers of Egypt, however, they offered expressions of regret at the loss of Egyptian life and an assurance of nonaggressive intent.

Defense Minister Ehud Barak has told the Egyptians that they can skirt the Israeli-Egyptian peace treaty and send thousands more troops, accompanied by helicopters and armored vehicles, into Sinai to restore order in the increasingly lawless peninsula. In the past, Israel opposed any alteration of the terms of the treaty. But the lawlessness — a mix of Bedouin tribalism, radical Muslim infiltration and a breakdown of Egypt’s security control after its revolution — affects not only Israel, but Egypt, which depends on tourism revenue and gas exports from there.

As a result, officials here say, the Egyptians are cooperating with Israel. The two governments agreed to jointly investigate the Israeli forces’ killings of three Egyptian policemen after last week’s terrorist attack, an approach Israel initially opposed. Israeli officials also say the Egyptian military is making sure that the attack on Israel, which received very limited coverage in Egypt at first, is now getting more public attention.

While all the shifts across the region, including the bloody battle for control of Syria, are being discussed at the highest levels, Egypt, the largest Arab country, remains the biggest concern.

“So much depends on the Egyptian story,” one official said. “If it ends in chaos, it will be a totally different Middle East. Our relations with the army are good and need to be maintained. But who rules Egypt, the army or Tahrir Square?”

All officials interviewed said that popular sentiment, as expressed through the uprising that started in Tahrir Square, plays a greater role in Egyptian policy than it did under President Hosni Mubarak, who was overthrown in February. Mr. Mubarak showed no affection for Israel and came here only once, for a few hours, for the 1995 funeral of Yitzhak Rabin. But his rule is associated with cooperative relations.

In spite of the concerns, Israeli officials noted Egypt’s new leaders have not carried out changes they had promised publicly.

“When the new government came to power in Egypt it vowed to change its policies toward Iran, the United States, the peace treaty with Israel and Gaza,” said Shlomo Brom, a retired general now at the Institute for National Security Studies at Tel Aviv University. “So far it hasn’t done any of it.”

By contrast, there has been a steady shift away from Israel in Turkey, which until a few years ago was both a strategic ally and a society welcoming to Israeli visitors and business. The government of Prime Minister Recep Tayyip Erdogan has angrily criticized Israel’s Gaza policy and demanded an apology after Israeli commandos killed eight Turks and an American of Turkish origin aboard a flotilla seeking to break Israel’s naval blockade of Gaza last year.

Mr. Netanyahu’s aides and advisers have been divided over how to respond to Turkey’s demands. So far, a majority opposes an apology, arguing that Israel has nothing to apologize for and that it would make no difference.

A minority disagrees, calling for some apology and compensation for the victims. As one put it: “Turkey is not a lost cause. We may not be able to divert the stream of where it is headed, but with care we can cross the river. We still have a lot of common interests with them.”

Some officials say the concerns over Israel’s diplomatic difficulties are overstated, that Israel is stable and reliable and still has plenty of friends, for example, Greece, Cyprus, Romania and Bulgaria.

And with Arab countries focused on inner turmoil and President Bashar al-Assad of Syria fighting for the survival of his government, Israel’s strategic position may be better than believed, since those countries cannot now expand their militaries or contemplate a war.

“Our biggest concern is Iran, and Iran’s biggest ally is Assad, so his fall would be good for Israel,” one official said. “Stepping back, diplomatically and culturally, things are worrying. But strategically we are not on the edge of a cliff.”

Others disagree. “They don’t understand how fragile the calm now is,” another Israeli official said of the optimists. “We are losing support and legitimacy. I am not panicked. But I am worried.”


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