ISIS beheading an ominous sign in struggling Egypt

The apparent beheading of Croatian engineer Tomislav Salopek by the Egyptian affiliate of ISIS tells us three things, all of them very ominous.

ISIS affiliates will try to seize and murder Westerners wherever they can, knowing the propaganda impact of such horror is far greater than most of their operations.

ISIS' reach in Egypt now extends far beyond the lawless Sinai peninsula, into the western desert the other side of Cairo, where Salopek was abducted on July 22. That may have implications for the presence of Western technical expertise in Egypt, which the country badly needs.

The Egyptian government, despite repeated pledges to wipe out the ISIS presence in the country -- and devoting immense resources to the task -- seems to be making little progress in that endeavor. It is up against a well-organized and militarily sophisticated adversary, perhaps the most effective ISIS affiliate beyond Iraq and Syria.

And the Islamic State in Northern Sinai (ISNS) is not the only jihadist outfit at work in Egypt.

Abducting Westerners a priority

After seizing Salopek, ISNS made a demand that it probably knew the Egyptian authorities would not meet, the release of female Muslim prisoners. It showed Salopek in a jump suit -- the trademark garb of all hostages on ISIS' hideous "death row." And for maximum impact, it gave the government 48 hours to accede to its demands. After a delay of several days, it has finally published what appears to be confirmation of the execution.

Salopek had worked as a topographer in several Arab countries. There are tens of thousands of Westerners like him working in Egypt and elsewhere across the region. Many will now be asking themselves and their companies whether and where it is safe to continue.

These companies will likely need to reassess security arrangements -- even in areas until now thought to be free of ISIS operatives. That's not a favorable environment for foreign investment.

Another Western worker, William Henderson, was killed last year not far from where Salopek was abducted. Henderson, an American citizen, was gunned down in an apparent carjacking, according to the company that employed him, Apache Oil. Only months later did the ISIS affiliate, known as Ansar Beit al Maqdis until it pledged allegiance to ISIS last November, publish photos of Henderson's passport and other ID cards, claiming it had killed him.

ISIS spreads its wings

But ISNS poses a far greater challenge than occasional gun attacks on police and tourists or the gruesome execution of a Westerner caught in the wrong place at the wrong time.

It has built up a resilient infrastructure in the Sinai desert and shown itself capable of complex assaults against well-defended army positions. A raid at the beginning of July on the town of Sheikh Zuweid left many soldiers and police dead. Even the official count was 23; other estimates were double that number.

According to an Israeli Defense Forces analysis of the attack, cited by Haaretz, the assault targeted 15 outposts simultaneously. It also included the effective use of a favored ISIS tactic -- vehicle-borne suicide bombs. So concerned are the Israelis by the explosion of violence in Sinai that they've permitted the Egyptians to deploy forces there above and beyond what was authorized in the 1979 peace treaty.

More than once in recent months, Egyptian troops are reported to have fled in the face of determined ISNS assaults. The Islamists have used anti-tank missiles and, most spectacularly, a guided missile that badly damaged an Egyptian patrol boat in the Mediterranean.

A recent commentary from the Institute for the Study of War suggested that "recent defeats provide a reflection of the poor training and relative unpreparedness which handicap Egyptian military operations in ISIS' core terrain in the Sinai."

Mokhtar Awad and Samuel Tadros, in a forthcoming piece for the Combating Terrorism Center's Sentinel, say that Ansar Beit al Maqdis inherited the mantle of several jihadist groups active between 2011 and 2013 and used the relative freedom of the short Muslim Brotherhood government to rebuild jihadist networks.

But the Egyptian government is finding it difficult to box jihadists into the Sinai. Several times, ISIS and other groups have claimed attacks to the west of the Canal and in greater Cairo. Most notable was the assassination in a car bomb explosion of Egypt's chief prosecutor, claimed by an little known group called Giza Popular Resistance.

56 photos: The ISIS terror threat

These attacks may have been abetted by the growth of jihadist cells in the Nile Valley which had worked with Ansar Beit al Maqdis (before it signed up to ISIS.)

Awad and Tadros believe some of these cells may now see themselves as independent actors supportive of ISIS, rather than belonging to the Sinai branch. They point to the huge bomb explosion outside the Italian Consulate in Cairo on July 11, which was claimed by the Islamic State, not its Sinai affiliate.

There also is the growing threat from ISIS wilyat (or provinces) in neighboring Libya, which the Egyptian air force has targeted. And, lest we forget, al Qaeda sympathizers in Egypt are far from extinct.

One of the most notorious and capable is a former special forces officer, Hisham Ashmawy, likely responsible for carrying out an attack near the border with Libya last year in which 21 Egyptian soldiers were killed, according to Awad and Tadros.

Egypt's multiple crises

Egypt faces a multi-faceted jihadist threat -- geographically and organizationally -- just as President Abdel Fattah al-Sisi's government is anxious to kick-start economic recovery after the financial missteps of the short-lived Muslim Brotherhood government. The jewel in the crown was the opening of the $8.5 billion extension of the Suez Canal (which ISNS sought to wreck with the announcement of Salopek's abduction.)

But the public finances are still in a dire state. Last year, Sisi thanked Saudi Arabia and the United Arab Emirates for their financial support, estimated at $11 billion, saying: "If it was not for your support, Egypt would not have survived until now."

In an effort to reduce the deficit, the government has pledged to introduce a value-added tax on goods and services, but appears wary of the popular backlash that might provoke.

The United States looks on anxiously, aware of Egypt's huge strategic importance but worried that human rights abuses since Sisi overthrew the Muslim Brotherhood two years ago will only lead to further radicalization.

It has resumed arms shipments, which were suspended late in 2013, with one US official noting that the delivery of eight F-16s would help the fight against terrorism. (Egypt used F-16s to try to repel the July attack on Sheikh Zuweid.)

At the same time, U.S. Secretary of State John Kerry warned in Cairo last week that if trust between citizens and authorities was lacking, "more misguided people will be driven to violence and there will be more attacks."

Egyptian decline?

For more than a generation, Egypt has been the Arab world's heavyweight, militarily and diplomatically.

It was the Arabs' shield in the face of the Islamic revolution in Iran. It has hosted the headquarters of the Arab League since 1964. Henry Kissinger once said, "You can't make war in the Middle East without Egypt, and you can't make peace without Syria."

Egyptians have also produced much of the region's most popular films and distinguished literature. Four Egyptians have been Nobel laureates.

Nowadays, observers reflect on the country's relative decline in a region fractured by insurgencies and where Turkey and Iran seem to be the behemoths.

Egypt has an uneasy alliance with Israel -- their common enemy Hamas in Gaza -- and relies on Saudi Arabia and the Gulf states for financial support.

Certainly, it has seen all sorts of terrorism in the past: Nasserite revolutionaries and a range of Islamist groups including Egyptian Islamic Jihad, whose supporters assassinated President Anwar Sadat -- one of those Nobel laureates. And it has endured its fair share of economic crises.

But in the words of Steven A. Cook, a leading authority on the country, Egypt's current political dynamics are wracked by "hypernationalism, political instability, widening violence, and a pervasive sense of chaos."