US envoy seeks to shore up influence in post-Morsi Egypt

US Deputy Secretary of State Bill Burns held talks with Egypt’s interim president and prime minister in Cairo today on the first visit of a senior US official to the country since President Mohamed Morsi was deposed earlier this month, but appears to have failed to meet with members of both the embattled Muslim Brotherhood and protest leaders who helped drive Morsi from power. 

The visit takes place as supporters of the ousted President Morsi remained on the streets, decrying what they and their leaders insist was a military coup. As well as meeting with President Adly Mansour and liberal economist turned interim prime minister Hazem el-Beblawi, Deputy Secretary Burns is also expected to hold talks with civil society and business leaders. According to the State Department, Burns will use the meetings to “underscore US support for the Egyptian people, an end to all violence, and a transition leading to an inclusive, democratically elected civilian government." 

But the US agenda for Egypt is not shared by everyone. The Gulf monarchies of Saudi Arabia, Kuwait, and the United Arab Emirates have promised $12 billion to Egypt since Mr. Morsi was deposed on July 3. But they are hostile to democratic change in the region and the rise of the Muslim Brotherhood that was symbolized by Morsi's election in June 2012. A democratically elected government is not one they'd favor, particularly if it returns the Brothers to power.

It is as yet unclear as to whether Burns will meet with members of the Muslim Brotherhood. The group's political wing, the Freedom and Justice Party, said it had no scheduled meeting with Burns and the party’s supporters have blamed the Obama administration for not doing more to keep Morsi in power.

And on Monday, a senior official in the ultraconservative Islamist Nour Party, which supported Morsi's ouster, said the group had turned down an invitation to meet on account of what he called “unjustified interference in Egyptian internal affairs and politics” by the US.

One of interim President Mansour’s greatest challenges in the months ahead will be finding a way to create the impression of an inclusive transitional period, despite the very real possibility that the Muslim Brotherhood - which previously dominated elected state institutions - will not be involved.

On Sunday, The Guardian reported that the Brotherhood is engaged in backchannel negotiations with the military, just eleven days after it deposed their president. The Islamist organization has denied this claim, however, and it remains difficult to see how the Brotherhood can return to political life in the short term.

But no matter what message Mr. Burns sends to Egypt’s military and interim civilian leadership in private, his public pronouncements are likely to be benign. The Obama administration has struggled to deal with the semantics of Egypt's latest crisis, avoiding labeling it as a coup. Under US law, this would require America to halt an annual aid package. Burns today urged the Egyptian military to avoid "politically motivated" arrests, but Morsi remains under house arrest and there have been persistent rumors in Cairo of plans to arrest other Brotherhood leaders.

The US and Egypt have long maintained close military ties and the US supplies Egypt with annual military aid worth about $1.3 billion. While US Secretary of Defence Chuck Hagel kept in regular contact with Gen. Abdel Fatah al-Sisi throughout the military takeover, American influence has appeared limited in recent weeks.

Behind-the-scenes accounts of Morsi’s ouster describe a series of long phone calls between Hagel and Sisi as Washington conveyed its objections to the overthrow of an elected president. But the generals plowed ahead regardless, exposing the limits of a three-decade long military relationship. 

Meanwhile, the aid promised by Saudi Arabia and others - if delivered - could shore up the transition, whatever the US thinks of it. “This gives the government some much needed breathing space and removes the immediate issues of payment on specific goods,” says Angus Blair, director of financial think tank The Signet Institute.

The Gulf states, with the exception of Qatar, had been more hesitant to offer financial support to Egypt with the Muslim Brotherhood in power, fearing that support for Islamists abroad might embolden Islamists at home.

Egypt’s new planning minister, Ashraf al-Arabi, says this regional cash injection will be enough to carry the country through its transition period, ruling out any immediate need for an IMF loan. Usually advertised as a much needed financial lifeline for a country in crisis that would lead to a surge in funding from other lenders, the proposed $4.8 billion loan has been stalled for over a year because of the political ramifications of making the subsidy cuts the IMF is demanding in exchange.

The promised Gulf aid would represent significant cash injection for Egypt, allowing it to replenish depleted stocks of wheat and oil. Egypt is the world's biggest importer of wheat and also buys diesel to distribute at subsidized prices.

But some experts worry that an overreliance on money from the Gulf will allow Egypt’s new leaders to avoid economic and structural changes that they believe to be vital in the short-term.

“I think most people would worry that reforms will not happen as soon as they should,” said Mr. Blair. “I’m concerned that [Arabi] is saying that there is not going to be as much attention paid to addressing the budget deficit and making necessary structural reforms as we would hope.” Describing the new minister's comments as "irresponsible," Blair said he was concerned that they signal an unwillingness to deal with pressing economic issues.

In a reminder of the acute danger, former supplies minister Bassem Ouda told Reuters last Thursday that Egypt has only two months’ worth of wheat stocks remaining.

Meanwhile, supporters of the Muslim Brotherhood remain out on the streets. In northeast Cairo, tens of thousands of Islamists are taking part in a vigil for their deposed president. They say they will not leave until he has returned to office.

The Brotherhood’s political arm, the Freedom and Justice Party, has called for Morsi supporters to "paralyze" Cairo tonight by blocking off central squares and highways. Given the level of anger at America's perceived role in Morsi's ouster, Secretary Burns will likely be avoiding these jams.