U.S. may freeze most Egypt aid in days: Report

The United States may announce within days that it is suspending most military aid to Egypt – sparing counter-terrrorism efforts and other “core interests” – three months after that country’s military toppled its democratically elected president, according to U.S. officials and the Reuters news agency.

President Barack Obama is leaning toward withholding most assistance that does not directly go towards battling extremists or fostering security in the Sinai Peninsula, enforcing Egypt’s peace treaty with Israel, Reuters reported late Tuesday. Obama has not made a final decision, the agency said.

CNN reported that all U.S. aid would be affected and that the suspension would take effect in the coming days.

The White House denied that Obama had decided to halt “all military assistance.” But it left the door wide open to suspending some the aid three months after Egypt’s military ousted President Mohamed Morsi in July — a move the United States has stubbornly refused to call a coup.

“The reports that we are halting all military assistance to Egypt are false,” National Security Council spokeswoman Catlin Hayden said in a statement. “We will announce the future of our assistance relationship with Egypt in the coming days, but as the President made clear at UNGA, that assistance relationship will continue.”

That statement left ample room for the Reuters report to be accurate. Another U.S. official declined to specifically deny the news agency’s version.

Obama said 10 days ago on the sidelines of the United Nations General Assembly that he had “concerns” about the political turmoil in Egypt but said he was “committed to a constructive relationship” in part because of the country’s peace treaty with Israel.

“So we will continue to work with the Egyptian government, although urging them and pushing them in a direction that is more inclusive and that meets the basic goals of those who originally sought for more freedom and more democracy in that country,” Obama said as he met with Israeli President Benjamin Netanyahu.

In his speech to the United Nations General Assembly, Obama was even more blunt, saying that the United States would keep working with countries that do not embrace democracy as long as they “work with us on our core interests,” like fighting Islamist extremists.

“Going forward, the United States will maintain a constructive relationship with the interim government that promotes core interests like the Camp David Accords and counterterrorism. We’ll continue support in areas like education that directly benefit the Egyptian people. But we have not proceeded with the delivery of certain military systems, and our support will depend upon Egypt’s progress in pursuing a more democratic path,” he said.

In the subsequent months since Morsi’s removal, Egypt’s military has banned the Muslim Brotherhood and taken other actions against the group, which won a narrow majority in the country’s first democratic elections since the removal of longtime dictator (and close U.S. ally) Hosni Mubarak.

In the past, Israel has urged the United States not to withhold aid in a way that might upset the balance kept by the peace treaty or send Egypt plunging into the kind of chaos that extremists could exploit to attack the Jewish state.

It’s not clear whether the potential shift in assistance will come with a determination that Morsi’s removal was in fact a coup d’état – a step that, under U.S. law, would require a halt to military aid.
In August, the United States denied it was freezing aid to Egypt’s military, effectively treating Morsi’s ouster as a coup despite publicly refusing to say so.

At the time, officials indicated that a review of roughly $585 million in unspent funds was ongoing and confirmed that the United States was considering withholding the delivery of 10 Apache helicopters, had suspended the delivery of F-16 fighters, and canceled a prominent biannual joint military exercise known as “Bright Star.”
Egypt is currently the fifth largest recipient of international aid from the United States , behind Israel, Afghanistan, Pakistan and Iraq. Though the amount of annual aid to Egypt fluctuates from year to year, the U.S. has sent Egypt an average of $2 billion in annual financial packages since 1979.

Yahoo News Chief Washington Correspondent Olivier Knox contributed to this report.