As Egypt's controversial political transition moves forward under the watchful eye of a military-backed interim government, the United States faces a dilemma over whether to embrace General Abdel-Fattah el-Sissi or risk jeopardizing its relations with Cairo, a key strategic ally in the Middle East.

So far, the White House has declined to label General el-Sissi's overthrow of President Mohammed Morsi - Egypt's first democratically elected leader - as a military coup. That's because the US Foreign Assistance Act bars Washington from providing aid money to "any country whose duly elected head of government is deposed by military coup or decree."

By calling Morsi's ouster a coup, the Obama administration would have been obligated to cut $1.5 billion (1.1 billion euros) in aid money to Egypt. A significant portion of that money goes directly to US defense contractors which manufacture weapons systems for Cairo. The money also helps to maintain the 1979 Egypt-Israel peace agreement.

In January, the US Congress passed a spending bill that effectively allows the Obama administration to circumvent the Foreign Assistance Act and transfer aid money to Egypt under the condition that the country makes progress toward democratic governance.

"It's an attempt by the Congress to give more space and freedom to the administration to deal with a government that came to power by a coup," Khalil al-Anani, an Egypt expert with the Middle East Institute in Washington, D.C., told DW.

Half-measures

Last October, the White House suspended $250 million in cash transfers to Egypt as well as the delivery of tanks, attack helicopters and warplanes among other weapons systems. But according to Tarek Radwan, the Obama administration was only paying lip service to the Foreign Assistance Act.

"These were halfway measures that neither satisfied US law, which prohibited this kind of assistance to governments that have been overthrown by the military, but it's also not been enough to really correct the behavior," Radwan, an Egypt expert at the Atlantic Council in Washington, D.C., told DW.

"We're looking at the imminent accession of General el-Sissi to the presidency - if that's not pre-2011, I don't know what is," Radwan said.

Procedural democracy

Under the legislation passed by Congress, the White House can transfer $975 million in aid to Egypt once a constitution has been approved in a national referendum. In January, the military-backed draft constitution was passed with 98 percent of the vote. But only 38 percent of the Egyptian electorate cast their ballot.

After the referendum, US Secretary of State John Kerry expressed concern, citing NGOs that said the process had not been inclusive and that opponents had been arrested for campaigning against the constitution. Kerry called on Cairo to "take these concerns into account as preparations are made for presidential and parliamentary elections."

"What Kerry's statements show is a support for essentially lip service to procedural democracy rather than any kind of substantive democracy," Radwan said.

Once presidential and parliament elections have taken place, the Obama administration can then release the remaining money to Egypt, nearly $577 million. According to Radwan, the White House is "essentially giving up" on the democratic process in Egypt in order to focus on preserving Washington's strategic ties with Cairo.

"We are going to try and resurrect our same old security arrangement in Egypt as we did under Mubarak," Radwan said of the US position.