[Salon] Sisi’s phoney war - ArabDigest.org Guest Post

Sisi’s phoney war Summary: Egyptian President Sisi’s precipitous rush to back Saudi Arabia in its war with Yemen’s Huthis has been met with stiff resistance from his military and security elites. We thank our regular contributor Maged Mandour for today’s newsletter. Maged is a political analyst who also contributes to Middle East Eye and Open Democracy. He is a writer for Sada, the Carnegie Endowment online journal and the author of Egypt under El-Sisi (I.B.Tauris) which examines social and political developments since the coup of 2013. You will find his most recent Arab Digest podcast The encirclement of Sisi here. In a speech on 17 October, President Sisi called for an urgent parliamentary session to authorise sending Egyptian troops to support Saudi Arabia in its ongoing war with the Huthis. The language used in the speech implied a large deployment, with Sisi stating his willingness to act according to the “directive of King Salman and the Crown Prince.” It took parliament a week to deliberate and approve the deployment, authorising Sisi to take all necessary measures, granting him a blank cheque to proceed as he wished. This strong gesture, however, seems to be only just that, with the deployment most likely remaining limited and defensive in nature. That is a fact not lost on the Saudis who are yet to issue any official comment on the Egyptian offer, a clear diplomatic cold shoulder. At play are a number of factors placing real limits on the ability of the regime to project power, even if Sisi wants to. Perhaps the most surprising of these limits is elite dissent against the move, with reports appearing that claim the decision announced by Sisi triggered dissent within the National Security Council headed by the president, which approved the deployment on the 18 October. The dissent seems to have revolved around the nature of the deployment and its scope, as well as critiques of Sisi's choice of words i.e. “according to the directive of King Salman and the Crown Prince” which was considered demeaning to the Egyptian military. This dissent seems to have been effective, with the Egyptian Foreign Minister Badr Abdelatty and intelligence chief, Major General Hassan Mahmoud Rashad, travelling to Riyadh to deliver a message that the role of Egyptian troops would be limited to protecting Saudi territory rather than attacking Yemen, thus greatly diminishing the utility to the Saudis of the troop deployment. Dissent was also reflected in the delay in the parliamentary approval to send troops, which took a week of deliberation, an eternity for Sisi's rubber-stamp parliament. Whether this is an indication of genuine dissent or a delaying tactic to buy some time for the military elites to agree to the troop deployment remains unclear but it is an obvious sign of tension within the regime around the issue. It is worth noting that this is not the first time the president has faced dissent. For example, as the Israeli genocide in Gaza intensified Sisi was inclined to accept the mass exodus of the Palestinians, a prospect that was vetoed by the military on national security grounds, showing the real limit the elites can choose to place on his power. On 29 July a drone attack caused a fire aboard two vessels off the Mediterranean port of Damietta, the first such attack on Egyptian territory since the Iran war erupted in late February. Ansar Allah (the Huthis) denied any responsibility for the attack. The other clear limit on the regime's ability to project power is the fragility of the Egyptian economy and the immense damage that the Huthis can inflict if they decide to strike the Suez Canal and other Egyptian infrastructure. The Huthis have already warned that Egypt’s involvement will be considered an act of war with the Suez Canal as a highly likely primary target. This comes at a time when the Egyptian economy is under immense pressure to keep hot money - short-term highly liquid and speculative financial capital - flowing into the country when energy prices remain high and structural imbalances are deepening. For example, the current account balance deficit has widened to reach US$22.5 billion in the fiscal year 2025/26 that ended in June of this year, up from US$15.4 billion the previous year, an increase of 46%. The balance of trade deficit hit a record US$65 billion, driven by an increase in the price of oil and gas which contributed a whopping US$18.3 billion to the deficit. The increased pressure is reflected in the value of the Egyptian pound, trading at more than 56 to the dollar, an historic low. This places a premium on the ability of the regime to attract capital inflows to Egyptian debt instruments, which explains the decision of the central bank to raise interest rates by 100 basis points, the first increase since March 2024. The increase, however, will only act to pile pressure onto the already strained state budget. That in turn will increase the need to borrow more. It is a vicious circle which will be worsened by the now widely expected attack on Iran and the increase in energy prices that are bound to follow, as well as the anticipated increase in interest rates by the Fed, all applying pressure on an already fragile economy. Hence, Sisi’s decision to deploy troops is facing real constraints and might have significant blowback. If the goal was to placate Saudi Arabia in the hope that it would provide much-needed funds, that does not seem to have worked. On top of Riyadh not issuing an official statement welcoming the deployment of troops, underlining Sisi's increasingly marginalised situation, Egypt was missing from the talks between Türkiye, Pakistan, Saudi Arabia and Iran that took place in Tehran. If the Huthis carried out their threat and start to attack the Suez Canal and other crucial infrastructure, it would have a disastrous effect on the Egyptian economy, particularly if it is followed by a mass exodus of hot money. In a war of attrition, this scenario is not unlikely, especially if the Saudi-Huthi conflict drags on. Finally, if Trump launches a major attack on Iran causing energy prices to spike while Egyptian ports and the Suez Canal are under Huthi attack, an already deep fiscal crisis will only get that much deeper. A steep price to pay for Sisi’s act of verbal bravado.