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OO RUEHWEB

DE RUEHEG #0177/01 0401346
ZNY SSSSS ZZH
O R 091346Z FEB 10
FM AMEMBASSY CAIRO
TO RUEHC/SECSTATE WASHDC IMMEDIATE 0195
INFO RHEHAAA/NATIONAL SECURITY COUNCIL WASHINGTON DC
RHMFISS/HQ USCENTCOM MACDILL AFB FL
RHMFISS/JOINT STAFF WASHINGTON DC
RUEHEG/AMEMBASSY CAIRO
RUEKJCS/SECDEF WASHINGTON DC

S E C R E T CAIRO 000177 
 
SIPDIS 
NOFORN 
 
E.O. 12958: DECL: 2020/02/09 
TAGS: PREL PARM MASS IS KPAL EG
SUBJECT: Sinai Update: Counter Smuggling and Floods 
 
REF: SECDEF 122723; CAIRO IIR 6 899 0149 10; 2009 CAIRO 2394 
2009 CAIRO 491 
 
CLASSIFIED BY: Margaret Scobey, Ambassador, DOS, EXO; REASON: 1.4(B), 
(D) 
 
¶1.  Key Points: 
 
 
 
-- (S/NF) The GOE claims to have increased its efforts against 
HAMAS-related smuggling activity, and reports recent success in 
interdicting and dismantling goods and financial smuggling 
networks. 
 
 
 
-- (C) Recent heavy rains in northern Sinai caused an estimated $11 
million worth of damage.  Local residents have complained about the 
GOE's slow response and say the Muslim Brotherhood and other 
Islamic organizations have provided the most effective relief 
services.  Rains also temporarily halted construction of a 
subterranean steel wall and reportedly caused damage to the vast 
network of smuggling tunnels under the Egypt-Gaza border. 
 
 
 
-- (S/NF) Security concerns have temporarily suspended installation 
of the FMF-funded border tunnel activity detection system (BTADS), 
which will delay the scheduled April 2010 completion date.  MOD has 
agreed in principle to accept follow-on support for the BTADS 
project. 
 
 
 
-- (SBU) USAID is still awaiting approval from the Ministry of 
International Cooperation (MIC) to begin implementing $50 million 
in FY2009 Supplemental funding aimed at creating economic 
alternatives to smuggling in the Sinai peninsula. 
 
 
 
----------------- 
 
Focusing on HAMAS 
 
----------------- 
 
 
 
¶2.  (S/NF) During a recent meeting with Secretary of Defense Gates, 
the Director of the Egyptian General Intelligence Service (EGIS) 
Omar Soliman said that Egypt was increasing efforts to combat 
HAMAS-related smuggling activity, including bolstering security 
along the Sudanese border (ref A). He also reported increased 
effectiveness in tackling smuggling networks in Sudan, Somalia, and 
Yemen.  Egyptian officials have separately reported recent success 
at interdicting and dismantling HAMAS-related goods and money 
smuggling networks along the Egypt-Gaza border. 
 
 
 
--------------------------------- 
 
Sinai Flood Damage Localized..... 
 
--------------------------------- 
 
 
 
¶3.  (C) Multiple contacts in northern Sinai told us that damage 
from the floods is severe, but localized along and in the Wadi El 
Arish riverbed.  Osama Kassas, Head of the North Sinai 
Businessmen's Association, which is helping with the rebuilding 
process, stated that seven people died as a result of the floods 
and damages are estimated to be around 60 million Egyptian pounds 
(USD 11 million).  He said the flood destroyed the open market, a 
bus station and the Olympic village, which housed a branch of the 
Ministry of Youth, because the GOE built them in the riverbed.  In 
addition, villages in central Sinai and residential areas of El 
Arish city along the riverbed were severely damaged including the 
two roads that crossed the riverbed connecting western and eastern 
El Arish city. Our contacts in Sinai said 27 houses and 60 
businesses were completely destroyed, and 90 houses were severely 
damaged by water and mud.  Kassas said approximately 1,200 people 
 
were directly affected by the flood. 
 
 
 
--------------------------------------------- --- 
 
But Residents Frustrated with Assistance Efforts 
 
--------------------------------------------- --- 
 
 
 
¶4.  (C) Kassas told us that Sinai residents were frustrated that 
the Egyptian Government had taken two days to respond to the 
flooding and were hostile toward PM Nazif during his visit to 
inspect the damage.  Kassas said the GoE repaired the two roads and 
is beginning to provide assistance such as blankets, tents and 
food.  However, its efforts are "random and disorganized" with 
assistance going to those with connections and not those who most 
need it.  He stated that most NGOs and private businesses in Sinai 
either do not have the capacity to provide assistance or are 
focused only on publicity.  Kassas said the most effective relief 
efforts are those connected with the Muslim Brotherhood and other 
Islamic organizations. (Comment: The Muslim Brotherhood does not 
have a strong organizational presence in northern Sinai. If they 
are providing relief services, they would have likely deployed 
people from outside the Sinai peninsula.  End Comment). 
 
 
 
¶5.  (SBU) On January 31, First Lady Suzanne Mubarak traveled to 
North Sinai to see the damage caused by the floods.  She met with 
the North Sinai Governor Mowafi, various ministers and local 
leaders.  She said that the GoE is working to resolve the crisis 
caused by the floods and begin a "new phase for development" for 
the region. Security forces required those people living in tents 
due to flood damage to remove the tents and evacuate the area 
during the visit.   An 11-truck aid convoy from the Ministry of 
Military Production arrived in El Arish with refrigerators, water 
heaters, gas cylinders, televisions and domestic electric 
appliances for flood victims. 
 
 
 
---------------------- 
 
Flooding and Smuggling 
 
---------------------- 
 
 
 
¶6.  (S/NF) The January 14 - 19 flooding also temporarily halted 
construction of a subterranean steel wall along the Egypt-Gaza 
border.  Construction re-started on January 29.  The Egyptian 
military also reported finding fewer tunnel openings since the 
rains (ref B), but noted increased activity along the Palestinian 
side of the border, which they attributed to repair work on 
rain-damaged tunnels (Comment: Even small amounts of rain can cause 
tunnels to collapse, so a significant amount of flooding would 
likely cause serious damage.  End Comment). 
 
 
 
------------------- 
 
USG-Funded Programs 
 
------------------- 
 
 
 
¶7.  (S/NF) The FMF-funded BTADS project has been on-hold since 
January 2 due to security concerns (ref C).  We are currently 
awaiting MOD-approval to conduct a security assessment of the Rafah 
area before redeploying the Army Corps of Engineers (ACE).  On 
January 31, MOD denied OMC's most recent request citing undisclosed 
"security concerns."  During a January 11 meeting with Field 
Marshal Tantawi, Ambassador and OMC Chief stressed the importance 
of working together to ensure security concerns are quickly and 
effectively addressed so installation can resume.  During the same 
meeting, Assistant Minister of Defense Major General Mohammed 
al-Assar claimed that the project was still on track for a February 
2010 completion.  (Comment:  Al-Assar is fully aware that delays 
 
will extend completion well beyond April 2010.  It is likely that 
he has not informed Tantawi of the delay originally caused by the 
Minister's own insistence on technical modifications for the 
original BTADS equipment.  End Comment).  On January 21, MOD did 
agree in principle to submit a request for follow-on support for 
the BTADS project, which will be critical once the ACE completes 
the installation and turns the system over entirely to the Egyptian 
military. 
 
 
 
¶8.  (S/NF) EGIS is moving forward, albeit slower than originally 
anticipated, on a Nonproliferation and Disarmament Fund (NDF) 
financed project to deploy 15 x-ray scanners to inspect vehicular 
traffic entering the Sinai for explosives and arms (ref D). 
Representatives from EGIS and the Ministry of Interior are 
currently in the United States for operator training.  EGIS 
anticipates that the necessary infrastructure preparations for the 
first site, the Ahmed Hamdi tunnel, will be completed by late 
March/early April. 
 
 
 
----------------- 
 
Sinai Development 
 
----------------- 
 
 
 
¶9.  (SBU)  Ambassador and AID Director met with Minister of 
International Cooperation (MIC) Fayza Aboulnaga on February 3 to 
discuss the $50 million in FY2009 ESF Supplemental funding aimed at 
improving economic opportunities and employment in the North Sinai 
governorate.  Minister Aboulnaga continued to object to provisions 
related to project monitoring and audit plans, even though AID has 
repeatedly modified the draft assistance agreement in consideration 
of the special security circumstances in North Sinai and the GOE's 
desire to minimize the USG's profile in the governorate.  AID is 
making one last effort to meet MIC concerns, but will not 
compromise on basic, legal requirements to conduct audits and 
monitor USG-financed work. AID Director is also scheduled to meet 
with the new North Sinai governor to solicit his support for the 
program. 
SCOBEY