Since Egypt's president, Mohammed Morsi, was ousted in a military coup on 3 July, the US has been in an awkward position. An automatic Congressional instrument halts military aid in the event of a coup. The US supports the Egyptian military to the tune of $1.3bn a year, and thus far has avoided using the term "coup d'etat" to describe the ousting of Morsi, so this aid has continued.
While ideology may have contributed to this reluctance to halt aid – in that America wants to support the secularist army over the Islamist Morsi – there were also strategic concerns. Military aid to Egypt over the years has helped the US to guarantee peace with Israel, access to the Suez Canal, and help with counter-terrorism work.
But it seems that something has changed. It was announced today that the US is suspending a large part of the $1.3bn aid package it gives to Egypt. The delivery of large-scale military systems, as well as cash assistance to the Egyptian government, will be withheld. "We will continue to hold the delivery of certain large-scale military systems and cash assistance to the government pending credible progress toward an inclusive, democratically elected civilian government through free and fair elections," said a spokesman for the state department. A $260m cash transfer will be halted, as will a $300m loan guarantee. The delivery of Apache helicopters, and Harpoon missile and tank parts, will be stopped too. Money to ensure security in the volatile Sinai Peninsula and for military training and counter-terrorism will continue, as will non-military aid for health and education projects.
Since July, the White House administration has been intensely debating how best to respond. Some argued that the US had a responsibility to pressurise the military to restore democracy in Egypt; not just altruistically, but because of the fear that continued repression would push disenfranchised Muslim Brotherhood members towards terrorism. Others argued that the US should not damage its strong relationship with Egypt, warning that cutting aid to Egypt's military could seriously affect its standing in the region. This latest announcement comes after a review of the funding, launched in August after a harsh crackdown by the authorities left hundreds of supporters of Morsi dead.
So what impact will this move have? The first thing to note is that it was not unexpected: deliveries of military hardware were already halted, a military exercise cancelled, and in practice, cash aid has been on hold since the summer. Against this backdrop, the state department statement is hardly surprising. The BBC's Kim Ghattas suggests that "the suspension of aid is more symbolic – a slap on the wrist – than a painful cut in essential aid".
Any financial damage to Egypt will be off-set by Saudi Arabia and the United Arab Emirates. Both nations are already giving generous financial aid to the county and have said they will make up for any aid shortfalls. There has also been some suggestion that Egypt could seek military assistance from other countries, such as Russia.
But while immediate financial losses can be easily avoided, there remains the risk of damage to the US-Egypt relationship. Since the 1978 Camp David Accords, this strong relationship has been a key feature of America's strategy in the Middle East. The US is not the only country concerned about good relations continuing. Last week, Israeli Prime Minister Binyamin Netanyahu said that his country's interest was "having the peace with Egypt continue" and that this was "premised on American aid to Egypt".
Be that as it may, America retains some suspicions about the military regime in Egypt. Morsi's party may have been Islamists, but anti-Americanism is hardly absent from those who backed his ousting. The Tamarod movement, whose protests preceded the overthrow of Morsi, has called for the interim government to reject US aid. Moreover, backing the military was becoming more untenable for the US as each day went by. Now, Egypt's judiciary is preparing to put Morsi and other senior members of the Muslim Brotherhood on trial – days after the EU foreign policy chief Catherine Ashton flew to Cairo to lobby for Morsi's release and reconciliation.
The US has made it clear that the aid suspension is only temporary, and will be restored in the event of credible elections, or "progress" towards them. But with American influence already reduced, funding continuing to certain areas, and the shortfall restored by other countries, will this call to action really make a difference? A symbolic move is better than nothing, but it may not be the way to bring about real change.
The views expressed in this article belong to the author and do not necessarily reflect the editorial policy of Middle East Monitor.