The base, which will reportedly be built "very soon", would threaten national security, and the Egyptian government is "deeply suspicious", according to a diplomatic source.

Djibouti is strategically located in the Horn of Africa across the Gulf of Aden from Yemen, where the Saudis have been waging war against Houthi rebels. A recent UK report suggested that Iran has been smuggling weapons to the rebels via the waterways surrounding Yemen.

"Cairo is totally against the deal because it considers Djibouti to be under the Egyptian sphere of influence and because its location is important for national security," an Egyptian diplomatic source, who spoke on the condition of anonymity, told The New Arab.

"This move goes against the generally accepted customs between Arab countries as the area has a direct influence on the passage of ships towards the Suez Canal.

"If Saudi Arabia wants to ensure that Iran does not take control of the area, that is understandable - however, this must take place with Egyptian oversight and permission."

The Egyptian government was supported by billions of dollars in aid from Saudi Arabia in the immediate aftermath of the 2013 military coup against former Muslim Brotherhood leader Mohammad Morsi, but ties appear to have frayed between the two countries amid disagreements over Syria.

Saudi Arabia backs rebels trying to oust Assad, while Egypt has expressed support for the Syrian leader.

Saudi Arabia suspended oil shipments to Egypt in October, a move announced after Cairo backed a Russian-drafted resolution on Syria in the UN Security Council.

This week, sources told The New Arab that Saudi Arabia would not mend ties with Egypt until Foreign Minister Sameh Shukri was sacked and two contested Red Sea islands were transferred to Saudi sovereignty.

Djibouti's Foreign Minister Mahamoud Ali Youssouf saidthe deal to build the Saudi military base would happen "very soon".

"The security, military and strategic draft of the accord is ready and the coastal areas that could host the base, be it military or naval, have been identified after Saudi military officers and officials explored some areas in the country."

Source-The New Arab