Egyptian President Hosni Mubarak today hosted Israeli and Palestinian leaders for the second round of direct Israeli-Palestinian negotiations in the resort town of Sharm el-Sheikh.

Most Middle East nations are sitting on the sidelines, not wanting to expend political capital on a potentially fruitless exercise.

But for Mr. Mubarak, the negotiations provide a new opportunity to persuade the US that his role in the process should merit freedom from US pressure on key domestic issues like upcoming elections and the prospect of succession by the president’s son Gamal.

“Peace talks in my opinion are just a card in the hands of the Egyptian regime in dealing with the US,” says Emad Gad, an analyst at the government funded Al Ahram Center for Political and Strategic Studies. “I think the Egyptian regime is using the direct talks in order to get a green light from the Americans for Gamal Mubarak.”

US envoy George Mitchell said after the leaders met for nearly two hours at the Red Sea resort town that talks were moving in the right direction. But he did not say whether Israeli Prime Minister Benjamin Netanyahu, who delayed his return to Jerusalem for a second round of unscheduled talks, and Palestinian Authority President Mahmoud Abbas had made headway on extending an Israeli settlement freeze due to expire Sept. 26.

Palestinian leaders have threatened to pull out of negotiations if settlement expansion in the occupied territories resumes. The leaders are scheduled to meet again in Jerusalem on Wednesday.

Expecting that the talks will end if common ground isn't found soon on settlement expansion, most Middle East nations are sitting on the sidelines, not wanting to expend political capital on a potentially fruitless exercise.
Cash for consensus

Since Camp David, the US-Egypt relationship has been a give-and-take in which the US hands Egypt substantial aid (about $1.5 billion last year) and generally stays out of Egyptian politics, while Egypt maintains peace with Israel and is a staunch US ally in the region.

But Egypt's stable, authoritarian political model could be in for some upheaval as the aging Mubarak, rumored to be in ill health, is almost certainly in the twilight of his nearly 30-year reign. Many Egyptians suspect he is grooming his son to assume power in a system rigged in favor of the ruling National Democratic Party (NDP).

Democracy advocates have urged the US to pressure Egypt to hold a free and fair parliamentary poll this November and to hold a fair presidential election next year. US pressure on democratic reform in Egypt substantially abated in the second term of President George W. Bush, and the softer stance on democracy in Egypt has been maintained by the Obama administration, which has limited itself to statements of support for democracy but little action.

Mr. Gad says Mubarak is aiming to play up Egypt’s importance to shield it from pressure. But his motives aside, many analysts say support from Egypt and other regional powers will be critical if the talks are going to have a chance at succeeding.

“As we move down the road, the cooperation and even the involvement of other Arab partners like Syria, Lebanon, and Saudi Arabia will be necessary,” says Michele Dunne, a senior associate and editor of the Arab Reform Bulletin at the Carnegie Endowment for International Peace.

Gad sees signs that regional players like Saudi Arabia, which presented the Arab Peace Initiative in 2002, and Syria are willing to play ball if Abbas and Netanyahu can keep talks going.
Syria for peace?

Gad points to the reactions of Iran and Syria to the direct Israeli-Palestinian negotiations as a sign of Syria’s tacit support. While Iran blasted the talks and attacked Egypt for participating, Syria – where Mr. Mitchell will pay a visit on Thursday – did not. “So Syria is waiting for including the Golan Heights in these talks,” he says.

But with or without regional support for the talks, Egypt may not get what it was bargaining for.

“The pace of developments inside Egypt … is such that the US cannot ignore it,” says Dr. Dunne. While the Obama administration bought into Egypt’s argument during its first year, that honeymoon is over, she says.

“The wake-up call was the renewal of the emergency law,” which severely restricts civil rights in Egypt. After the US criticized that move, she says, “The State Department has been making statements on a regular basis, hoping that Egypt will hold free and fair elections.”

She pointed out that a transcript of President Obama’s recent meeting with Mubarak in Washington shows he raised the issue of the coming elections.

Dunne says the US is capable of both pushing for reform in Egypt while also depending on Cairo to push its policies in the region. The reason is that in some areas, such as peace talks, the two nations have similar goals. If Egypt simply follows its own national security interests, it is also acting in the interest of the US.

“It isn’t the case that Egypt is doing specific favors for the US and therefore the US needs to pay Egypt back,” she says.