Egypt

July 2008 | Risk Summary

The increasing association of Iran with Hamas puts Egypt in a difficult position vis-à-vis the Islamic Republic's escalating war of words with Israel. Historically, relations with the Islamic Republic have been hostile since the latter cut ties in 1981, and despite some improvements over the last year or so, appear to be deteriorating again. A far more natural position for Egypt is on the Israeli side, particularly as it shares its neighbour's fear of Hamas, but as usual this is out of synch with the public mood. At a time of high inflation and rising public discontent, Egypt would

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