UK terrorism reinsurance fund hopes to include cyber: CEO

LONDON (Reuters) – Britain’s 6 billion pounds ($7.3 billion) terrorism reinsurance fund hopes to extend its cover to include cyber attacks on property, chief executive Julian Enoizi said.

Pool Re, set up in 1993, acts as a backstop to insurers paying out claims on property damage and business interruption.

It is financed by the insurance industry with government backing, and pay outs depend on the British government deeming an attack to be terror-related, Enoizi said.

In 2002, Pool Re extended its cover to include chemical and biological attacks after the 9/11 attacks in the United States.

There have been several cyber attacks on property in recent years. In 2014, a German steel mill suffered damage to the plant’s network from a cyber attack.

Enoizi told Reuters that this and other incidents had been ruled out as terror attacks, but Pool Re needed to be prepared.

“Insurance is there for the unimaginable – we’re here to insure the unforeseen,” he said.

The fund has held discussions with the government and industry, and it hopes to add cyber to its coverage in the next few months, he added.

Enoizi said any increase in the premium costs to businesses for adding this cover would be accompanied by discounts for implementing government-approved cyber security policies.

The U.S. cyber insurance market is likely to have totalled about $3.25 billion in premiums in 2016, according to market survey The Betterley Report. The European market is seen as one-tenth of that, but demand has been increasing, insurers say.

Demand is expected to spike after EU legislation on data privacy is implemented by mid-2018. This will require companies to notify authorities of data breaches likely to harm individuals, similar to U.S. arrangements.

But most cyber policies relate to data loss, rather than attacks on property.

“We see this as a gap in the cover,” Enoizi said.

Cyber attacks on property worry businesses and insurers. These include an attack at some apartment buildings in Finland last year which knocked out the heating system when it was below freezing outside. This attack was not deemed an act of terror.

Insurers have said the source of a cyber attack is hard to prove, and most policies pay out regardless of the cause.

Pool Re’s cover would be limited to terror-related cyber attacks, once the British government assessed it to be an act of terrorism, Enoizi said.

(Reporting by Carolyn Cohn; Editing by Edmund Blair)

German shopping mall shut on police fears of an attack

Police at the Limbecker Platz shopping mall in Essen, Germany, March 11, 2017, after it was shut due to attack threat. REUTERS/Thilo Schmuelgen

ESSEN, Germany (Reuters) – Police in the western German city of Essen sealed off a shopping center in the center of town and ordered it to remain closed on Saturday due to concrete indications of a possible attack.

Germany is on high alert following major radical Islamist attacks in France and Belgium and after a failed asylum seeker from Tunisia drove a truck into a Berlin Christmas market in December, killing 12 people.

“Yesterday we received very serious indications from security sources that a possible attack was planned here for today and would be carried out,” a spokesman for Essen police told Reuters Television. “That is why we were forced to take these measures.”

Earlier, a police spokesman told a German broadcaster that they had viewed the threat as a possible “terrorist” attack.

Armed police and vans surrounded the shopping center, one of Germany’s biggest with more than 200 retail outlets, but roads nearby were open to traffic.

Essen, in the industrial Ruhr region, has nearly 600,000 inhabitants.

(Reporting by Reuters Television; Writing by Madeline Chambers; Editing by Toby Chopra)

Iraqi forces recapture Mosul government buildings, museum

Military vehicles of federal police are seen during a battle with Islamic State militants in Mosul, Iraq, March 7, 2017. REUTERS/Thaier Al-Sudani

By Isabel Coles and John Davison

MOSUL, Iraq (Reuters) – Iraqi government forces fighting to drive Islamic State from western Mosul on Tuesday recaptured the main government building, the central bank branch and the museum where three years ago the militants had smashed statues and artifacts.

The government buildings had been destroyed and were not used by Islamic State, but their capture still represented a symbolic victory in the battle over the militants’ last major stronghold in Iraq.

An elite Rapid Response team stormed the Nineveh governorate building and government complex in an overnight raid, spokesman Lieutenant Colonel Abdel Amir al-Mohammadawi said.

They also seized a building that housed Islamic State’s main court of justice, known for its harsh sentences, including stonings, throwing people off building roofs and chopping off hands, reflecting Islamic State’s extreme ideology.

“They killed tens from Daesh,” Mohammadawi said, referring to Islamic State by one of its Arabic acronyms. The raid lasted more than an hour.

The militants looted the central bank when they took over the city in 2014 and took videos of themselves destroying statues and artifacts.

Illegal traffic in antiquities that abound in the territory under their control, from the sites of Palmyra in Syria to Nineveh in Iraq, was one of their main sources of income.

Prime Minister Haider al-Abadi flew into to Mosul to visit the troops engaged in the fighting.

“Iraqis shall walk tall when the war is over,” he told state TV as he arrived there.

The breakthrough paves the way for the U.S.-backed forces to attack the militants in the old city of Mosul, the most complicated phase in the nearly five-month campaign due to the density of the population and the narrowness of the alleyways. The militants are dug in amongst civilians in the historic district.

It was from the Nuri Mosque in the old city that the group’s leader, Abu Bakr al-Baghdadi, declared in 2014 a caliphate also spanning parts of neighboring Syria.

The old city lies on the western bank of the Tigris river that cuts Mosul in two. About 750,000 people were estimated by aid organizations to live in west Mosul when the offensive started on this side of the city on Feb. 19.

The Iraqi forces took the eastern half in January, after 100 days of fighting. They are backed by air and ground support from a U.S.-led coalition.

Defeating Islamic State in Mosul would crush the Iraqi wing of the self-declared caliphate, which also suffering setbacks in Syria.

U.S.-backed Syrian Democratic Forces cut the last main road out of the Islamic State capital there, Raqqa, on Monday. Islamic State is also fighting off the Russian-backed Syrian army as well as and Turkey and allied Syrian rebels.

The number of Islamic State fighters in Mosul was estimated at 6,000 at the start of the offensive on Oct. 17, by the Iraqi military who estimate several thousands have been killed since.

Lined up against them is a 100,000-strong force of Iraqi troops, Kurdish peshmerga fighters and Iranian-trained Shi’ite Muslim paramilitary groups.

Some of Islamic State’s foreign fighters are trying to flee Mosul, U.S. Air Force Brigadier General Matthew Isler told Reuters at the Qayyara West Airfield, south of the city.

“The game is up,” Isler said. “They have lost this fight and what you’re seeing is a delaying action.”

SNIPER FIRE

Islamic State snipers continued to fire at the main government building after it fell into government hands, restricting the movements of the soldiers.

Rapid Response sharp-shooters were firing back from the building. One of them said four enemy snipers had been killed.

“The fighting is strong because most of them are foreigners and they have nowhere to go,” said the head of a sniper unit for the Rapid Response, al-Moqdadi al-Saeedi.

More than 40,000 people fled their homes in the past week, bringing the total number of displaced since the start of the offensive to more than 211,000, according to the United Nations.

Dozens more streamed out of the Mamoun district in southwestern Mosul toward U.S.-trained Counter Terrorism Service (CTS) troops as machinegunfire rang out in the background.

U.S. special forces were also seen walking between buildings in the same area, some of them carrying assault rifles with scopes and silencers. Helicopters attacked targets just north of their positions as thick smoke filled the sky from various explosions.

Agencies say camps to accommodate them are nearly full even though the United Nations said last month that more than 400,000 people still in western Mosul could be displaced.

Several thousand have been killed and wounded in the fighting, both civilians and military, according to aid organizations.

(For map of Mosul click http://tmsnrt.rs/2fd0nGE)

(Writing by Maher Chmaytell; Editing by Angus MacSwan)

U.N. head: drought-stricken Somalia needs help to avoid famine

U.N. Secretary general Antonio Guterres addresses a news conference after his meeting with Somali President Mohamed Abdullahi Mohamed (L) in Somalia's capital Mogadishu March 7, 2017 REUTERS/Feisal Omar

By Katharine Houreld

MOGADISHU (Reuters) – Rich countries must do more to stop drought-stricken Somalia from sinking into famine, the head of the United Nations said on Tuesday, warning terrorism would increase without aid.

“If you want to fight terrorism, we need to address the root causes of terrorism. We need to bring peace and stability to a country like Somalia … It’s the best way for rich countries to protect themselves,” U.N. chief Antonio Guterres told a news conference in Mogadishu.

The United Nations is asking for $825 million to provide aid to 6.2 million Somalis, about half the country’s population.

“I am not appealing for the generosity of the rich, I am appealing for the enlightened self-interest of the rich,” said Guterres.

His appeal comes a day after U.S. President Donald Trump signed a revised executive order suspending travel to the United States from six mainly Muslim nations, including Somalia. Trump, who has justified that measure on national security grounds, has also said he will slash budgets for U.S. aid and diplomacy.

Those policies will hit Somalia hard, after more than 25 years of civil war and an ongoing battle between its U.N.-backed government and an Islamist insurgency.

The current drought is threatening to turn into famine, with at least 360,000 Somali children severely malnourished, meaning they need extra food to survive.

“If we don’t have rain in the coming two months this could be a humanitarian crisis that could be the same as we had in 2011, when we lost 260,000 people,” said Somali President Mohamed Abdullahi Mohamed.

Families from rural areas are moving to cities to search for food as animals die and water sources evaporate, forcing many to drink water infected with deadly cholera bacteria.

Asha Mohamed, 18, brought her two young daughters to the capital after the family’s sheep and goats died.

“When we got food, first we fed the children. We would only eat afterwards if there was enough,” she said.

Her neighbor, Medina Mohamed, said she must divide her food to ensure her smallest children and disabled son are fed first.

“The others don’t understand,” she said. “Everyone wants to eat.”

Low rainfall in neighboring Kenya has also left 1.3 million people in need of food aid there, while severe drought prompted water restrictions in South Africa at the end of last year and North Africa faced its worst drought in decades.

(Reporting by Katharine Houreld; Editing by Julia Glover)

Iran, Turkey presidents meet to defuse tensions

Iran's President Hassan Rouhani (R) is welcomed by Turkey's Prime Minister Tayyip Erdogan as he arrives for a meeting at Erdogan's office in Ankara June 9, 2014. REUTERS/Umit Bektas

DUBAI (Reuters) – Iranian President Hassan Rouhani and Turkey’s President Tayyip Erdogan agreed on Wednesday to improve ties, including in the fight against terrorism, Iran’s state news agency IRNA said, following some angry exchanges between the regional rivals.

Tehran and Ankara support opposite sides in the conflict in Syria. Largely Shi’ite Muslim Iran backs the government of President Bashar al-Assad, while Turkey, which is majority Sunni, has backed elements of the Syrian opposition.

Last month Erdogan and Turkish Foreign Minister Mevlut Cavusoglu both accused Iran of trying to destabilize Syria and Iraq and of sectarianism, prompting Tehran to summon Ankara’s ambassador.

Erdogan and Rouhani met on the sideline of an economic cooperation summit in the Pakistani capital Islamabad, IRNA said, though it gave no details of their talks.

Regional rivalry between Iran and Turkey is nothing new, but political analysts have linked Ankara’s tougher rhetoric to U.S. President Donald Trump’s approach to the Middle East.

Trump has been sharply critical of Iran, including a nuclear deal it clinched in 2015 with major powers, while Turkey, a NATO ally, is hoping for improved ties with Washington after a chill caused partly by U.S. criticism of Ankara’s human rights record.

In another conciliatory move by Turkey, Cavusoglu told IRNA in an interview published on Wednesday that Ankara had appreciated Tehran’s expressions of support for the government during a failed military coup against Erdogan on July 15, 2016.

“Iran was with us to support our government in every minute at that night while some other countries only called us days or even weeks after the attempted coup,” IRNA quoted him as saying.

Last week Iranian Foreign Minister Mohammad Javad Zarif had called Turkey an ungrateful neighbor.

“They (Turkey) accuse us of sectarianism but don’t remember we didn’t sleep on the night of the coup,” he said.

(Reporting by Bozorgmehr Sharafedin; Editing by Gareth Jones)

U.S.-backed Iraqi forces close in on IS-held Mosul government buildings

An Iraqi Special Forces soldier moves through a hole as he searches for Islamic State fighters in Mosul, Iraq February 27, 2017 REUTERS/Goran Tomasevic

By Isabel Coles and Maher Chmaytelli

MOSUL/BAGHDAD, Iraq (Reuters) – U.S.-backed Iraqi forces on Tuesday battled their way to within firing range of Mosul’s main government buildings, a major target in the offensive to dislodge Islamic State militants from their remaining stronghold in the western side of the city.

Terrified civilians were fleeing the fighting, some toward government lines, often under militant fire. Others were forced to head deeper into Islamic State-held parts of the city, straining scarce food and water supplies there.

Iraqi forces captured the eastern side of Mosul in January after 100 days of fighting and launched their attack on the districts that lie west of the Tigris river on Feb. 19.

If they defeat Islamic State in Mosul, that would crush the Iraq wing of the caliphate the group’s leader Abu Bakr al-Baghdadi declared in 2014 over parts of Iraq and neighboring Syria. The U.S. commander in Iraq has said he believes U.S.-backed forces will recapture both Mosul and Raqqa – Islamic State’s Syria stronghold – within six months.

“The provincial council and the governorate building are within the firing range of the Rapid Response forces,” a media officer with the elite Interior Ministry units told Reuters, referring to within machinegun range or about 400 meters (1,300 feet).

Taking those buildings would help Iraqi forces attack the militants in the nearby old city center and would be of symbolic significance in terms of restoring state authority over the city.

U.S.-trained Counter-Terrorism Service (CTS) units battled Islamic State sniper and mortar fire as they moved eastwards through Wadi al-Hajar district to link up with Rapid Response and Federal Police deployed by the riverside, in a move that would seal off all southern access to the city.

The militants set ablaze homes, shops and cars to hide their movement and positions from air surveillance. Satellite pictures also showed a fabric cover set up over a street in the old city center.

Residents in districts held by the militants said they were forced to take their cars out of garages onto the street to obstruct the advance of military vehicles.

BRIDGE

Military engineers started repairing the city’s southernmost bridge that Rapid Response captured on Monday.

The bridge, one of the five in the city that were all damaged by air strikes, could help bring in reinforcements and supplies from the eastern side.

Several thousand militants, including many who traveled from Western countries to join up, are believed to be in Mosul among a remaining civilian population estimated at the start of the offensive at 750,000.

They are using mortar, sniper fire, booby traps and suicide car bombs to fight the offensive carried out by a 100,000-strong force made up of Iraqi armed forces, regional Kurdish peshmerga fighters and Iranian-trained Shi’ite Muslim paramilitary groups.

About 14,000 have been displaced so far from western Mosul, according to the Iraqi government, taking the total number of people displaced from the city since the start of the offensive in mid-October to more than 175,000, according to the United Nations.

About 270 civilians arrived early on Tuesday at the sector held by the CTS. The wounded were taken to the clinic, while men were screened to make sure they are not Islamic State members.

An officer called out the name Mushtaq and one man stood up. Another officer said they had received information that a militant called Mushtaq was hiding among the displaced.

One man was carrying a woman who had lost consciousness after her son was wounded by shrapnel as they fled the Tal al-Rumman district.

Another man, Abu Ali, arriving from Tal al-Rumman with his four young children, said Islamic State militants had killed their mother three months ago after she went out with her face uncovered. He said he had found her body in the mortuary, adding: “I would drink their blood.”

His family had been surviving on bread and wheat grain since Iranian-trained Iraqi Shi’ite militias severed supply routes from Mosul to Syria, essentially besieging western Mosul.

The United Nations World Food Programme said on Monday it was extremely concerned about the dire humanitarian situation facing families in western Mosul.

Army, police, CTS and Rapid Response units forces attacking Islamic State in western Mosul are backed by air and ground support from a U.S.-led coalition, including artillery fire. U.S. personnel are operating close to the frontlines to direct air strikes.

American soldiers were in MRAPs armored vehicles on the Baghdad-Mosul highway, near a billboard welcoming visitors to the Islamic State, “the caliphate that follows the example of the Prophet.”

(Editing by Janet Lawrence)

Islamic State car bomb kills more than 50 in northwest Syria

A still image taken from a video posted on social media uploaded on February 24, 2017, shows a pool of blood amid damaged motorcycles at a site of an Islamic State car bomb explosion, said to be in Sousian village near al-Bab, Syria. Social Media/ via REUTERS TV

By Angus McDowall and Humeyra Pamuk

BEIRUT/ISTANBUL (Reuters) – An Islamic State car bomb killed more than 50 people on Friday in a Syrian village held by rebels, a war monitor said, a day after the jihadist group was driven from its last stronghold in the area.

The blast in the village of Sousian hit a security checkpoint controlled by rebels fighting under the Free Syrian Army (FSA) banner.

The Syrian Observatory for Human Rights, a monitor of the war based in Britain, said more than 50 people died including over 30 civilians. Two rebels contacted by Reuters put the total death toll at least 40.

One of the two, a fighter with the Sultan Murad Brigade near al-Bab, said: “It was done on a checkpoint but there were a lot of families there gathered and waiting to get back to al-Bab. Therefore we have many civilian casualties.”

The Turkey-backed rebels drove Islamic State from the town of al-Bab on Thursday, following weeks of street battles near where Ankara wants to establish a safe zone for civilians.

Turkey’s military said on Friday that Syrian rebels had taken full control of all of al-Bab, and that work to clear mines and unexploded ordnance was under way.

Sousian is behind rebel lines about 8 km (5 miles) northwest of al-Bab, around which Ankara has long supported the formation of a security zone it says would help to stem a wave of migration via Turkey into Europe.

A second blast took place 2 km south of Sousian later on Friday, but it was unclear whether it was from a vehicle bomb or a planted device such as a mine. There were reports of casualties but no immediate details, the Observatory said.

Islamic State said in a social media posting that it was behind the Sousian attack, having acknowledged on Thursday it had lost control of al-Bab.

Syria’s main conflict pits President Bashar al-Assad, backed by Russia, Iran and Shi’ite militias, against rebels that include groups supported by Turkey, the United States and Gulf monarchies.

However, both those sides, as well as a group of militias led by Kurdish forces and supported by the U.S., are also fighting Islamic State, which holds large parts of northern and eastern Syria.

MINES AND CELLS

As mines laid in and around al-Bab claimed lives for a second day, the Sultan Murad Brigade fighter said many IS cells were still operating there.

“It is very dangerous. Our search and clear operation is still under way,” he said.

Two Turkish soldiers were killed on Friday while clearing mines in the town of Tadef south of al-Bab, Turkey’s military said in a statement. On Thursday, several Turkey-backed rebels were killed by a mine in al-Bab, the Observatory said.

Turkey directly intervened in Syria in August in support of rebel factions under the FSA banner to drive Islamic State from its border. It also wants to stop Kurdish groups gaining control of the region.

After taking al-Bab on Thursday, Turkish forces shelled Islamic State in Tadef, the Observatory reported.

The area immediately to the south of Tadef is held by the Syrian army and its allies, which have in recent weeks pushed into Islamic State territory in that area from Aleppo and advanced towards the Euphrates river.

Further east, the Syrian Democratic Forces, Kurdish-led militias backed by the United States, have in recent weeks taken dozens of villages from Islamic State as they close in on the group’s Syrian capital of Raqqa.

(Reporting By Angus McDowall and Humeyra Pamuk, additional reporting by John Davison in Beirut and Tulay Karadeniz in Ankara, editing by Ralph Boulton, John Stonestreet and Toby Davis)

Iraqi forces push into first districts of western Mosul

Rapid Response forces members cross farm land during a battle with Islamic State's militants south west of Mosul, Iraq February 24, 2017. REUTERS/Zohra Bensemra

By Stephen Kalin and Isabel Coles

SOUTH OF MOSUL, Iraq (Reuters) – U.S.-backed Iraqi security forces advanced deeper into the western half of Mosul on Friday one day after launching attacks on several fronts toward Islamic State’s last main stronghold in the city.

Troops had recaptured Mosul airport on Thursday, an important prize in the battle to end the jihadists’ control of territory in Iraq.

Counter-terrorism forces managed on Friday to fully control the Ghozlani army base, pushing deeper toward the southwestern districts of Tal al-Rumman and al-Mamoun, a military spokesman said.

Federal police and an elite Interior Ministry unit known as Rapid Response are clearing the airport of roadside bombs and booby traps left by Islamic State militants who retreated from their positions there on Thursday.

Iraqi government forces plan to repair the airport and use it as a base from which to drive the militants from Mosul’s western districts, where about 750,000 people are believed to be trapped.

Government forces pushed the insurgents out of eastern Mosul last month but the IS still holds the western sector of the city, divided by the Tigris river.

“Our forces are fighting Daesh terrorists in Tal al-Rumman and al-Mamoun. We will eliminate them soon and take control over the two districts,” Counter Terrorism Services (CTS) spokesman Sabah al-Numan said.

Islamic State militants used suicide car bomb attacks and drones carrying small bombs to disrupt the CTS units from further advancing.

“There is a resistance there. The drones are particularly annoying today,” Major General Sami al-Aridi, a senior CTS commander, told Reuters in the southwestern front of Mosul.

Rapid response forces are trying to advance beyond the airport to breach Islamic State defenses around districts on the southern edge of Mosul.

“We are now fighting Daesh at the southern edge of the city. We are trying to breach trenches and high berm they used as defensive line,” Colonel Falah al-Wabdan told Reuters.

Losing Mosul could spell the end of the Iraqi section of the militants’ self-styled caliphate spanning Iraq and Syria.

Iraqi commanders expect the battle in western Mosul to be more difficult than the east, however, in part because tanks and armored vehicles cannot pass through narrow alleyways that crisscross the city’s ancient western districts.

(Reporting by Stephen Kalin and Isabel Coles, Writing by Ahmed Rasheed; Editing by Angus MacSwan)

Millions risk starvation in Nigeria, Lake Chad region: United Nations

Children attend a class at a primary school in Muna Garage IDP camp, Maiduguri, Nigeria November 7, 2016. UNICEF/Naftalin/Handout via REUTERS

By Gwladys Fouche

OSLO (Reuters) – More than seven million people risk starvation in Nigeria’s insurgency-hit northeastern region and around Lake Chad, a senior U.N. official said on Wednesday ahead of a new funding appeal.

Famine has been ongoing since last year in parts of Nigeria where the government is fighting a seven-year long Boko Haram insurgency.

An international donor conference in Oslo on Friday will aim to raise a chunk of the $1.5 billion the United Nations says it needs to address deepening food insecurity in the region this year.

“They are living on the edge, barely getting by on one meal a day,” Toby Lanzer, the U.N. humanitarian coordinator for the Sahel, told Reuters. “My biggest concern today is starvation.”

Earlier this week the United Nations said 1.4 million children were at risk of “imminent death” in famines in Nigeria, South Sudan, Somalia and Yemen.

Lanzer said he was worried the Boko Haram insurgency would deter farmers from planting their crops after missing the last three planting seasons, and that the number of lives at risk could increase. He also expressed concerns the coming rainy season could harm vulnerable people.

“Hungry people without shelter when it rains die,” he said.

Lanzer said the humanitarian response needed to go beyond food aid and include seeds, tools and fishing nets.

Lanzer said he hoped a total $500 million will have been pledged by the end of February, including this week’s funding round.

Lanzer, who has also worked in South Sudan, Darfur and Chechnya, said it was difficult to estimate how many people would die from hunger in the next few months.

“If we were to lose another planting season, I dread to think how severe the crisis could get,” he said.

Some 10.7 million people in northeastern Nigeria and around Lake Chad — roughly two in every three people — need humanitarian aid, according to the United Nations.

Boko Haram militants have killed about 15,000 people and forced more than 2 million from their homes, and still launch deadly attacks despite having been pushed out of the vast swathes of territory they controlled in 2014.

Lanzer cautioned that failure to address the deteriorating situation could encourage more Africans to try and flee to Europe.

(Editing by Richard Lough)

Seeking to secure Sinai, Egypt builds closer ties with Hamas

A Palestinian worker repairs a smuggling tunnel after it was flooded by Egyptian security forces, beneath the border between Egypt and southern Gaza Strip November 2, 2015. REUTERS/Mohammed Salem/File Photo

By Lin Noueihed and Nidal al-Mughrabi

CAIRO/GAZA (Reuters) – After years of strained relations, Egypt is moving closer to Hamas in Gaza, offering concessions on trade and free movement in return for moves to secure the border against Islamic State fighters who have killed hundreds of policemen and soldiers in northern Sinai.

Egypt has been at odds with Hamas, which controls the Gaza Strip, since a crackdown by Cairo on the armed group’s Islamist allies. Egypt closed the border, opening it only rarely.

But in recent weeks Egypt has eased restrictions, allowing in trucks laden with food and other supplies, and providing relief from an Israeli blockade that has restricted the flow of goods into the coastal territory.

The relaxation follows high-level Hamas visits to Cairo, which wants to restore its role as a regional powerbroker and crush Islamic State followers in the Sinai Peninsula, a strategic area bordering Gaza, Israel and the Suez Canal.

It builds on what Egyptian and Palestinian sources say are efforts by Hamas to prevent the movement of militants in and out of Sinai, where they have killed hundreds of Egyptian soldiers and police since general-turned-president Abdel Fattah al-Sisi overthrew the Muslim Brotherhood in 2013.

Egyptian and Palestinian officials say the changes could signal a new era of closer cooperation after years of tension.

“We want cooperation in controlling the borders and tunnels, the handover of perpetrators of armed attacks and a boycott of the Muslim Brotherhood. They want the crossing to be opened and more trade,” one senior Egyptian security source said.

“This has actually begun, but in a partial way. We hope it will continue.”

While it doesn’t engage directly with Hamas, Israel is working with Egypt on border security and monitoring of Gaza. Military officials have voiced support for any steps that bring greater stability to northern Sinai and Gaza.

Hamas has increased security along its side of the border with Sinai over the past year, deploying hundreds of security forces and erecting more watchtowers. The group has also moved to round up Salafi Jihadists, who oppose an Egyptian-brokered 2014 ceasefire with Israel.

Hamas, whose charter calls for Israel’s destruction but which has no ambitions for global jihad, has not said how many militants it has captured and refuses to call them jihadists.

Egypt has given Hamas a list of about 85 fugitives, who it says are implicated in attacks and wants extradited, the Egyptian security source said. Hamas denied links with some of them and sources in the group said extraditions were unlikely though it might make its own inquiries.

Hamas has however let Egypt know that it has no interest in stoking unrest in an Arab neighbor that has mediated several truces with Israel and among rival Palestinian factions.

“If we compare it with a year ago, the situation or the relationship is better but it is not yet what is needed,” Mahmoud al-Zahar, a senior Hamas official, told Reuters.

“The needs of our people are great, their need to travel, pursue education or treatment, attend to their businesses and families abroad, and also the need for open trade with Egypt.”

MUTUAL DISTRUST, COMMON INTERESTS

The blossoming ties have been advanced by intense diplomacy, culminating last month in a visit by Ismail Haniyah, a deputy leader of Hamas, to meet Egyptian intelligence officials.

A series of conferences on Palestinian affairs have also taken place in Egypt in recent months attended by figures from Palestinian factions.

Organizers said the conferences were part of efforts to restore Egypt’s regional role following the chaos of the 2011 Arab Spring revolts.

“The situation now is returning to normal,” said Elazb al-Tayeb Taher, writer on Arab affairs at the state-owned Al-Ahram newspaper, which hosted one of the conferences in November.

“Egyptian intelligence is restoring its relationship with Hamas in accordance with certain guidelines, chief amongst them being that Hamas does not become a major gateway for threats from Gaza targeting Egypt’s national security.”

Despite mutual distrust, Hamas and Egypt kept communication channels open, with Hamas officials regularly invited to Egypt.

But ties hit a low in 2013, after Sisi overthrew President Mohamed Mursi, banned the Muslim Brotherhood as a terrorist organization and jailed many of its supporters.

Ansar Bayt al-Maqdis, a militant group that emerged in North Sinai in the chaos of 2011 and initially attacked Egypt’s gas pipelines to Israel, turned its guns on Egyptian forces. In 2014, it joined Islamic State and has since attacked in Cairo, killing 28 people in a church in December.

‘EARLY TO TALK OF TRADE’

Blockaded by Israel and facing the closure of their only other outlet, Gazans dug thousands of tunnels to smuggle in building materials and consumer goods and, according to Egyptian officials, smuggle out arms and fighters.

In a bid to crush the militants, Egypt’s military razed hundreds of homes and destroyed at least 2,000 tunnels.

Curfews, checkpoints and air strikes have devastated an area that once drew holidaymakers to its Mediterranean shore.

The desire to secure the area and restore a semblance of normality is as strong for Egypt, which wants to lure back foreign investors who fled after 2011, as it is for Gazans.

Egyptians who organized the Palestinian conferences suggested the border might be reopened to trade for 10 or 15 days at a time – rather than a few days every six weeks at present – to build trust.

But the ultimate aim is more ambitious; a free trade area and an industrial zone on the Egyptian side to facilitate commerce, allow Gazans to travel abroad, and create jobs for those who might otherwise join the militants.

“We’ve gotten to a point now with Hamas where we’re working on a framework on which to build for the coming period, and this will be contingent upon controlling the borders and the crossing will be open routinely,” said Tareq Fahmy, of the state-linked National Center for Middle East Studies, which co-organized two Palestinian conferences last year.

“We’re thinking of direct trade and all this is pivotal for our brothers in Hamas and the Gaza Strip, but … trust-building processes don’t take place overnight.”

For residents of northern Sinai, who face a gamut of checkpoints each day, open trade seems an outlandish notion. The conflict has rendered the area a wasteland of demolished houses, sand berms and trenches.

“It’s early to talk of trade. We are still living in a security zone,” said one resident.

(Additional reporting by Ahmed Mohamed Hassan in Cairo; editing by Giles Elgood)