The 25 Egyptian police officers taken hostage by Beduins in northern Sinai on Tuesday have now been freed. The men were released on the Egyptian border with Israel, reportedly unharmed. The freeing of the hostages concludes a series of events that began on Monday with a shoot-out between local Beduin and police on Monday, in which one Beduin was killed. A large and angry crowd of Beduin then gathered, firing weapons in the air, burning tires and clashing with security forces. The kidnapping took place in the context of these protests. This incident - which had Israeli forces on alert along the border earlier this week - cannot be understood in isolation. Rather, it is a reflection of a deeply problematic situation in the northern Sinai, which is host to large-scale smuggling networks that traffic a wide range of commodities between Sinai and Gaza and Israel. These networks are regarded by many Sinai Beduin as a legitimate source of income. This sense is exacerbated by the neglect displayed by the Egyptian authorities toward the Beduin of the north Sinai since the peninsula was returned to Egypt. Drugs, tobacco, sex workers, and weaponry are among the most notable items flowing into Israel and Gaza. Cash flows in the other direction. The development of fortress Gaza under Hamas rule is made possible through the smuggling paths of northern Sinai. But they also serve to facilitate the activities of organizations close to al-Qaida that have been active there in recent years, such as the Tawhid wal-Jihad group. The "smuggling industry" initially grew because it was one of the few areas of economic activity readily available to the Beduin. The area contains no industry. And while southern Sinai has been developed massively for tourism, the beneficiaries of this have been the very large numbers of Egyptians who have made their homes in the peninsula. The Egyptian authorities have considered the development of Sinai and its tourism industry as a useful outlet for providing employment to the large number of unemployed graduates produced each year by the Egyptian education system. The hand of the Egyptian authorities was only lightly felt in northern Sinai until recently. This meant that the smuggling industry could flourish, the neglect of the area could go unnoticed, and clashes between the Beduin and the central authorities could be avoided. The series of terrorist attacks that took place from 2004 on changed this situation. In Taba in 2004, Sharm e-Sheikh in 2005 and Dahab in 2006, suicide bombers struck, taking a heavy toll on civilian life. It was after these bombings that the Egyptian authorities began to increase their attempts to impose control on northern Sinai. US and Israeli pressure has resulted in the increased presence of police and security services in northern Sinai. In its turn, this increased presence has led inevitably to clashes with the Beduin of the area. The Beduin of the north have no great sense of loyalty to the Egyptian state - tracing their origins, as they do, to a wide variety of locations in the Arab world. The influence among them of extremist Islam is noticeable and growing. All these factors taken together create a permanent, latent tension between the authorities and the Beduin that is occasionally sparked into open confrontation, as took place this week. The series of events this week was not the first example of violence between the Beduin and the authorities. In 2005, the authorities located and killed Khaled Mosaad, the alleged founder of the Tawhid wal-Jihad group, at Jebel Halal, near el-Arish. His successor, Nasser Khamis el-Mallahi, who is believed to have been the mastermind of the Dahab bombings, was killed with six of his associates in a fight with the security forces a year later. These local successes have not, of course, served to shut down the smuggling networks, which continue to thrive. Their existence continues to impact on the lives of Israelis. Muhammad Saksak, who carried out the suicide bombing at an Eilat bakery on January 29, 2007, that killed three young men, entered Israel by way of Sinai. Thus, northern Sinai today constitutes, as a recent Israeli study put it, both a "springboard and a target" for Sunni jihadi terrorism. Inadequate investment and involvement by the Egyptian state in the area has allowed lawlessness to thrive. This, in turn, has created an environment friendly to the presence and activities of the jihadis. Just over two weeks ago, Egyptian authorities discovered eight ground-to-ground and ground-to-air missiles there that could have been on their way to al-Qaida associated groups or to Hamas in Gaza. Either way, northern Sinai today constitutes a desert playground - for smugglers and jihadis. Incidents like this week's kidnapping should serve to focus greater attention on the area on the part of both Egyptian and Israeli authorities. Jonathan Spyer is a senior researcher at the Global Research in International Affairs Center, IDC, Herzliya.