Between Washington & Beijing: Egypt’s Middle Power Dilemma
As regional warfare, Red Sea disruptions, and soaring debt erode Cairo’s traditional strength, Egypt is courting China to hedge its bets. Yet deep US dependencies may reduce this ambitious balancing act to mere tactical maneuvering
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Last month, Chinese President Xi Jinping paid a highly significant visit to Cairo to mark the seventieth anniversary of diplomatic relations between Egypt and China.
As Egypt's top trade partner, the two countries signed 25 agreements spanning economic, commercial, technological, security, and military cooperation, aligning Egypt’s Vision 2030 with China’s Belt and Road Initiative.
Furthermore, they agreed to boost bilateral trade using local currencies, capitalizing on their shared BRICS membership. Militarily, the visit was preceded by the joint air force training, "Eagles of Civilization."
Another key diplomatic outcome was China’s explicit recognition of Egypt’s water security and its rights to Nile resources, alongside Egypt’s reaffirmation of the One China principle.
Despite its significant political and economic outcomes, this visit should not be seen as a point of rupture in Egypt’s strategic positioning amidst the ongoing global powers competition. Neither Cairo nor Beijing seeks an exclusive relationship. Instead, for Egypt, closer ties with China represent strategic diversification rather than a replacement for its longstanding partnership with the United States.
For China, the visit asserted its growing regional role in the Middle East while presenting, through diplomacy, economic engagement, and mediation, an alternative approach to the more interventionist model associated with the United States.
Forging relations with diverse regional and global powers is not uncommon in international relations. For middle powers, however, such diversification can become an essential strategy for preserving autonomy and reducing vulnerability amid heightened uncertainty and shifting global power balances.
Under such conditions, middle powers seek to navigate the international system by diversifying their partnerships while avoiding alignment with one global power at the expense of another. They aim to capitalize on the opportunities created by growing multipolarity while avoiding being caught in the midst of intensifying tensions and polarization on the global stage.
As a middle power, Egypt’s dilemma is further intensified by the interaction of two factors: growing regional challenges and the continued erosion of its geopolitical assets.
For more than a decade, Egypt has faced mounting geopolitical threats, including civil wars in Libya and Sudan along its western and southern borders, rising tensions with Ethiopia over the Grand Ethiopian Renaissance Dam, which threaten Egypt’s access to its share of the Nile waters, and fierce regional competition over maritime boundaries in the Eastern Mediterranean.
Moreover, since October 7 and the subsequent war in Gaza, these geopolitical risks have escalated to a new level. Egypt has become increasingly concerned about Israeli regional aggression, including its efforts to push for the displacement of Palestinians from Gaza into Sinai, the seizure of control of the Rafah border crossing and the occupation of the Philadelphi Corridor, which Egypt regards as inconsistent with the provisions of the Egypt-Israel peace treaty.
These concerns have been compounded by repeated statements by Israeli leaders advocating the establishment of a “Greater Israel” – a vision that encompasses the annexation of parts of Egyptian territory.
As the conflict has transformed into a regional war, Egypt has suffered three major blows. First, Iran’s closure of the Strait of Hormuz has disrupted Egypt’s energy supplies and contributed to rising oil and gas prices.
Second, the Houthis’ weaponization of the Bab el-Mandeb Strait in their confrontation with Israel has contributed to a sharp decline in vessel traffic through the Suez Canal, which fell by approximately 50 %.
Third, Iran’s targeting of Gulf countries has directly affected the Egyptian economy, for which Gulf financial support, in the form of loans, investments, deposits, and remittances, serves as a lifeline.
Faced with these challenges, Egypt is currently experiencing erosion of its geopolitical assets across several dimensions. Its demographic power, as the country with the largest population in the Middle East, has been undermined by relatively low educational attainment, low wage levels relative to GDP, a large informal economic sector, and the predominance of low-skilled labor. Its long-standing sources of soft power, anchored in religious institutions such as Al-Azhar and the Coptic Church, as well as the popularity and regional influence of its arts, have also weakened due to several factors, including declining competitiveness vis-à-vis the Gulf and tighter state control and political misuse of religious institutions.
Geographically, the strategic advantage of the Suez Canal as a key route for international trade is challenged by alternative routes, while, as mentioned above, the Red Sea crisis has already significantly reduced traffic and revenues.
Furthermore, Egypt’s growing debt burden is placing additional constraints on its economic capacity. Its external debt reached $164.8 billion by June 2026, while interest payments were projected to account for 46.7% of total expenditure in the 2026/27 budget. Finally, although Egypt possesses one of the largest armies in the region, this hard-power asset appears increasingly overwhelmed by the military’s deep involvement in politics and the domestic economy.
Being highly vulnerable to significant geopolitical pressures, Egypt has sought to balance its strategic position amid competition among global powers.
According to the Egyptian Ministry of Foreign Affairs’ document, Strategic Balance: Features of Egyptian Foreign Policy Over Ten Years, issued in December 2025, one of the country’s key foreign policy principles is refusing to become entangled in various forms of international polarization. Across several chapters, the document details how Egypt has translated this principle into practice.
It demonstrates that Egypt’s approach is better understood as strategic diversification rather than strategic realignment. In other words, Egypt seeks to deepen its ties with China, Russia, India, Japan, and other emerging powers while simultaneously preserving its strategic relationship with the United States.
This apparently workable formula for Egypt does not go unchallenged. Given its heavy reliance on the United States politically, militarily, and economically, and the latter’s entrenched role in the Middle Eastern regional security architecture, diversification of alliances has yielded Egypt little more than a narrow room for tactical maneuvering rather than meaningful strategic autonomy.
Genuine balancing between competing international powers would require dismantling or restructuring many of these military and economic dependencies – a move that appears so disruptive, uncertain, and costly that Egypt is currently neither willing nor able to undertake it.
Disclaimer: This is an opinion column. The views expressed are the author's own and do not necessarily reflect the editorial position of Clash Report.
Muhammad Affan
Dr. Muhammed Affan serves as the director of Al Sharq Academia and teaches political science at Ibn Haldun University. Holding a PhD from the University of Exeter and a background in medicine, his research explores MENA politics, democratization, and Islamism. He is the author of Secularism Confronts Islamism: Divergent Paths of Transitional Negotiations in Egypt and Tunisia.
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