CAIRO Egypt and Israel said on Sunday they wanted a return to normal diplomatic activities after the Israeli ambassador flew home following the storming of the embassy in Cairo during violent protests.
Egypt's army, which took over when Hosni Mubarak was ousted on February 11, has struggled to quell public fury against Israel since five Egyptian border guards were killed last month when Israel repelled cross-border raiders it said were Palestinian.
The United States called on Egypt to protect the mission. Washington has given billions of dollars in military and other aid since 1979 when Egypt became the first Arab state to sign a peace treaty with Israel.
Israel said it was in talks about returning Ambassador Yitzhak Levanon and his staff but wanted security assurances.
"The security in front of the embassy has been enhanced," cabinet spokesman Mohamed Higazy told Reuters. "Returning back to normalcy is the objective for both sides."
About 16 trucks full of police and security personnel, three buses of military police, two armoured personnel carriers and other vehicles were parked near the embassy on Sunday.
Protesters marched on the embassy on Friday in the second major flare-up since the shooting.
First they tore down a wall erected to protect the embassy. Then they stormed it and clashed with police through the night.
"Those who rip down flags ... they are negating peace and the country," Israeli Prime Minister Benjamin Netanyahu told his cabinet. He said Israel would stick to the peace deal.
"I am glad there are other forces in Egypt, including the Egyptian government, that are interested in advancing peace."
An Egyptian security source said Egyptian guards exchanged fire on Sunday with suspected smugglers in the same border area where guards were shot last month. The source said there were no injuries and the group fled into Egyptian territory.
MONITORING THE SCENE
Traffic passed smoothly through a junction that a day before had been strewn with bits of concrete and debris. Charred police vehicles were in a side street near the embassy, located on the upper floors of a tower block next to the Nile.
The front pages of Israeli newspapers carried photographs of jubilant Egyptian flag-waving demonstrators on the balcony of the embassy. Other photos showed a tense Netanyahu, in a polo shirt, monitoring the scene on television.
Some Egyptian newspapers showed scenes of the protests. Al-Akhbar showed protesters breaking down the wall around the embassy with a metal pole and smoke coming from what it said was a document store room in the embassy.
Other newspapers carried photos of army vehicles deployed to secure the area.
In Iran, a fierce opponent of Israel which it refers to as the Zionist entity, one newspaper headline read: "Egyptian revolutionaries seized the den of Zionists." Media compared it to the 1979 seizure by students of the U.S. embassy in Tehran.
"All Muslim governments should close down embassies of the Zionist regime in their countries, before their nations take an action similar to Egyptian revolutionaries," Iranian MP Alaeddin Boroujerdi was quoted by Fars news agency as saying.
Egypt said it would try those behind the violence swiftly in emergency state security courts. Egypt has detained 111 people in connection with the incident, the official state news agency reported. Three people were killed and more than 1,000 injured.
Many Egyptians sympathize with the sentiments of those demonstrating against Israel, but activists, politicians and ordinary citizens have also criticised the violence.
"I don't want him (the ambassador) to come back because Israel doesn't respect anyone, but if they are in our country, then we should be able to protect them," said Mohamed Kamhawy, 28, an engineer working two blocks from the embassy site.
Ahmed Amr, 23, another engineer, said: "Tearing down the wall was right. They shouldn't have built it in the first place. But invading the embassy was wrong."
Some Egyptians are frustrated that Egypt did not take sterner measures against Israel after the border shooting. At the time, Egypt said it would withdraw its ambassador but did not carry through with the threat.
Israel has stopped short of apologising, saying it is still investigating the Egyptian deaths, which occurred during an operation against gunmen who had killed eight Israelis.
Israel is finding itself increasingly at odds with formerly sympathetic states in the region. It is embroiled in a feud with Turkey, once the closest of its few Muslim allies, over an Israeli raid last year that killed nine Turks on a flotilla bound for Gaza.
Egypt's ties with Israel, though never warm, were a pillar of Mubarak's foreign policy and buttressed his claim to be a regional mediator. Under Mubarak, displays of hostility to Israel were swiftly crushed by security forces.
(Additional reporting by Jeffrey Heller in Jerusalem and Parisa Hafezi in Tehran; Writing by Edmund Blair; Editing by Andrew Heavens and David Cowell)