Egypt on Tuesday rejected Israel's accusations that it was not doing enough to stop the smuggling of weapons into Gaza and that it had been assisting Hamas terrorists in infiltrating into Israel.
"(Foreign Minister Tzipi) Livni should focus on peace talks with the Palestinians instead of making unfounded accusations," the Egyptian Foreign Ministry said in a statement.
On Monday, Livni told the Knesset Foreign Affairs and Defense Committee that Egypt's performance on the Gaza border was "awful and problematic" and said that the weapons smuggling lowered the chances that pragmatic factions in Gaza and the West Bank would regain control.
Earlier Tuesday, Israel Radio quoted a top defense official as saying that the reports of tapes showing Egyptian soldiers assisting Hamas were leaked in order to sabotage Wednesday's meeting between Defense Minister Ehud Barak and Egyptian President Hosni Mubarak in Sharm e-Sheikh.
The Jerusalem Post reported last week that Israel had transferred the tapes to the US in order to push Congress to withhold part of the foreign aid it gives to Egypt.
The defense official went on to say that if Egypt wanted to take control of the smuggling into Gaza it would have done so by now. The remark came despite a Post report on Tuesday that Cairo had bought advanced tunnel detection systems.
He claimed there were some one hundred tunnels, allowing for a tremendous amount of weapons and other goods to be moved from the Egyptian side of Rafah Crossing to the Palestinian side.
The official added that the tunnels had turned into a massive source of profit and a "real industry." He explained that smugglers paid $3,000 a day to Hamas for the use of the tunnels and recounted how a month ago, the group closed one of the tunnels after smugglers refused to pay the fee.
An Egyptian security official in Rafah dismissed on Tuesday the report, saying that "the Egyptian security service have not received any tunnel detectors until now, and there was no indication from authorities that we will get any."
Social Welfare Minister Isaac Herzog blamed the opposition for trying to torpedo the Barak-Mubarak meeting.
"It is a tendency among opposition MKs to continuously try and ruin our relations with the Egyptians. It is true that at the moment there is some frustration regarding this relationship, but generally, Israeli-Egyptian ties are strategically important," he told Israel Radio. "Egypt is a vital entity in the region."
Referring to the video footage reportedly transferred to the US, a top Egyptian official on Monday rejected accusations that Egypt was not doing enough to stop weapons smuggling.
"This harms relations between Israel and Egypt and it causes the opposite of what we would like to achieve, which is to strengthen relations," the Egyptian official told the Post.
Mubarak is due to give an official response to the Israeli accusations after his meeting with Barak.
Barak's trip was coordinated by Egyptian Counsel-General to Israel, Sameh Nabil. A former emissary to Sudan, Nabil has been stationed in Tel Aviv for three months and has taken the lead position in coordinating with the Israeli diplomatic and defense echelon on the weapons smuggling issue. Barak will also meet Intelligence chief Omar Suleiman and Egyptian Defense Minister Muhammad Tantawi.
Yaakov Katz and Sheera Claire Frenkel contributed to this report
