An SDT, according to the executive order, is aperson found to pose a significant risk of disrupting the Middle East peace process, or to have materiallysupported acts of violence toward that end. These groups are discussed in this report, even though they operate outside the Near East region, because of theiralleged connections to the bin Laden network and the Taliban of Afghanistan. Since the uprising began, Hamas and its smaller ally, Palestinian Islamic Jihad (PIJ), have escalatedterrorist attacks against Israelis. war on the Taliban and Al Qaeda. History. Both seek to replace Egypt's pro-Western, seculargovernment with an Islamic state. The following Egyptian Islamist figures have beennamed as SDTs or as subject to enhanced financial restrictions under Executive Order 13224: (1) Shaykh UmarAbd al-Rahman, who was acquitted in 1984 of inciting Egyptian President Anwar Sadat's assassination, is in amedical detention facility in Missouri following his October 1995 conviction for planning terrorist conspiraciesin the New York area; (2) Ayman al-Zawahiri, about 51, who is a top lieutenant of bin Laden (see below) andwas convicted in Egypt for the Sadat assassination; (14) (3) Mohammad Atef, who, as noted above, was apparentlykilled in the U.S.-led war on Al Qaeda; (4) Rifa'i Taha Musa, about 48, who was arrested in Syria and extraditedto Egypt in October 2001; (5) Abbud al-Zumar, leader of the remnants of the original Jihad who is serving a 40year sentence in Egypt; (6) Talat Qasim, about 44, a propaganda leader of the Islamic Group; and (7) MuhammadShawqi Islambouli, about 46, the brother of the lead gunman in the Sadat assassination. The September 11, 2001 suicide hijacking attacks, allegedly by Al Qaeda, on the World Trade Center andPentagon were considered a threat to U.S. national security and led to a U.S. military campaign against Al Qaedain its primary sanctuary in Afghanistan, and against Al Qaeda's protector, the Islamic fundamentalist Talibanregime. Others say that much of the Al Qaeda network is based outside Afghanistan and its members still pose asubstantial threat to U.S. and other targets in the United States and abroad. Although most governments have agreed with the United States that the evidence of Al Qaeda's responsibility for September 11 is clear and compelling, there is little agreement on responsibility for thespate of anthrax mailings in the United States that followed the September 11 events. Some government workers are believed to have personal ties to individualIslamists there. Democratic Front for the Liberation of Palestine (DFLP) (31)

As have other non-Islamist Palestinian groups, the DFLP has revived some of its operations since the Palestinian uprising began in September 2000. During its most active period, the PLF conducted several high-profile attacks. The episode expanded U.S. concerns about Iran's sponsorship of terrorism by indicating a linkbetween Iran and Palestinian groups who are not Islamic in nature and with which Tehran has previously had fewlinks. Although no major international terrorist attacks have been linked to Iran since Khatemi took office in August 1997, the United States has not publicly noted any diminution of Iranian material support for terrorist groupsopposed to the Arab-Israeli peace process, such as those groups discussed earlier in this paper. (42) After an article to this effectappeared in January 2002, Bush Administration officialssought to downplay the possibility that Libya would be removed from the list anytime soon. The United States has tried to promote further progress on terrorism by slowly increasing engagement with Sudan. The effectiveness of other U.S. military action against terrorist groups or state sponsors is difficult to judge. economic sanctions, by themselves, can force major changes in the behavior of state sponsors of terrorism. The Clinton Administration rejected thoserecommendations as well. Since September 11, the UnitedStates has made cooperation against terrorism fundraising a major priority in its dealings with other countries,particularly Middle Eastern countries where much of the fundraising for Al Qaeda is conducted. On the other hand, critics believe that terrorism listcountries are likely to view a U.S. policy of engagement as a sign that supporting terrorism will not adverselyaffect relations with the United States. Legal Action

Legal action against terrorist groups and state sponsors had become an increasingly large component of U.S. counter-terrorism strategy, although the September 11 attacks and U.S. military response has, to some extent,diminished support among observers for this option.
The Al Qaeda terrorist network founded by Osama bin Laden is believed to pose a continuing, although diminished, threat to the United States at home and to U.S. interests and allies abroad following the network'sdefeat in its base in Afghanistan. As stated in taped appearances by its leaders since the September 11, 2001terrorist attacks on the World Trade Center and the Pentagon, the goal of Al Qaeda is to destroy high profile U.S.targets in order to end what Al Qaeda claims is U.S. suppression of Islamic societies. In these appearances, binLaden virtually claimed responsibility for the September 11 attacks. Throughout its history, Al Qaeda has soughtto oust pro-U.S. regimes in the Middle East and gain removal of U.S. troops from the region.
Before September 11, signs pointed to a decline in state sponsorship of terrorism. Since the attacks, some countries that are designated by the United States as state sponsors of terrorism, including Iran and Sudan, havecooperated to an extent with the U.S.-led war against Al Qaeda and its Taliban protectors in Afghanistan. Inspite of its cooperation against the Taliban and Al Qaeda, Iran is still considered a major sponsor of radicalIslamic groups that conduct terrorism against Israel.
The Arab-Israeli peace process is a longstanding major U.S. foreign policy interest, and the Administration and Congress are concerned about any terrorist groups or state sponsors that oppose the process. Possibly because ofa breakdown in the Palestinian-Israeli peace process in September 2000, Palestinian organizations such asHamas, as well as older groups such as the Popular Front for the Liberation of Palestine that have been inactivefor years, have stepped up operations against Israelis. Following several major terrorist attacks against Israelissince December 2001, the United States has strongly criticized Palestinian Authority President Yasir Arafat forfailing to exert sufficient efforts to constrain these and other groups. Some analysts assert that Israel's actionsagainst the Palestinians have contributed to increased Palestinian support for violence against Israel.
U.S. differences with other governments on the strategies for countering terrorism in the Near East have to some extent narrowed since September 11. The United States, in the past, differed with its allies, particularly on howto deal with state sponsors of terrorism; most allied governments believe that engaging these countriesdiplomatically might sometimes be more effective than trying to isolate or punish them. The United States hasgenerally been more inclined than its European allies to employ sanctions and military action to compel statesponsors and groups to abandon terrorism. Post-September 11 developments seem to have validated theimportance of both diplomacy and, in certain circumstances, more forceful responses in dealing with terrorism. Differences with allies have begun to reemerge as the Bush Administration expands its "war on terrorism,"indicating it will seek to prevent the emergence of threats by regimes -- some of which also have ties to terroristgroups -- that are developing weapons of mass destruction (WMD).
This report will be updated annually.