Israel respects Morsy's Egypt win, seeks cooperation

JERUSALEM (Reuters) - Israel voiced respect on Sunday for the victory of the Muslim Brotherhood in Egypt's presidential election, calling on the new administration in Cairo to maintain the countries' landmark peace accord.

"Israel appreciates the democratic process in Egypt and respects its outcome," Prime Minister Benjamin Netanyahu's office said in a statement after the Brotherhood's candidate, Mohamed Morsy, was declared successor to the U.S.-aligned Hosni Mubarak, who was toppled last year.

"Israel expects continued cooperation with the Egyptian administration on the basis of the peace accord between the two countries, which is in the interest of the two peoples and contributes to regional stability," the statement said.

The appeal to mutual expediency has been an Israeli refrain since Mubarak's ouster, which made way for the rise of Islamist movements repressed under his three-decade rule and hostile to the Jewish state, with which Egypt made peace in 1979.

An Israeli official, speaking on condition of anonymity, said the Netanyahu government hoped Morsy and the Muslim Brotherhood's parliamentary bloc would put the need to tend to Egypt's ailing economy ahead of any revision of bilateral ties.

U.S. aid to Cairo hinges on keeping the peace with Israel.

"Looks like we were right when we said the Arab Spring would become an 'Islamic Winter', even though Western nations laughed us off at the time," the Israeli official said. But he added that he hoped the Egyptian government would "try to be more statesmanly, by working in the interests of the country".

Eli Shaked, a former Israeli ambassador to Cairo, told Israel's Army Radio that Morsy's authority would likely be diluted by the powerful Egyptian army, which relies on Washington's defense grants.

Israel Hasson, a lawmaker with the centrist Kadima party who has served as a Netanyahu government envoy to Cairo, said the possibility of already chilly bilateral relations going into a deeper freeze meant Israel had to revive its peace partnership with the Palestinians after months of diplomatic stalemate.

Morsy's win was hailed by Hamas, the Islamist group governing Gaza and which is locked in a power struggle with the West Bank-based, U.S.-backed Palestinian Authority of President Mahmoud Abbas.

"The immediate conclusion to be drawn from this (election) is that the State of Israel and the Palestinian Authority have a common interest in quickly, quickly building a regional coalition," Hasson said.

(Writing by Dan Williams; Editing by Myra MacDonald)