Algeria adds diplomacy to antiterrorism arsenal Police patrol the border between Tunisia and Algeria in an area used as a refuge by militants The delegates from Mali gathered at the massive el-Aurassi hotel that looms over central Algiers. Hotel guests watched as they argued, gossiped and ate at the grand buffet, while behind the scenes Algerian and other international officials attempted to persuade the country's squabbling ethnic, tribal and political leaders to forge a lasting peace. The talks this autumn - the latest in a series of Algerian attempts to broker a deal between Mali's warring sides after Islamists seized control of half the country last year - failed. But they showed an increasingly assertive Algeria's determination to use diplomatic levers, as well as warplanes, guns and tanks, to quell the rising number of threats on its borders. Festering political disputes, rejuvenated jihadi movements and western military interventions in north Africa and the Sahel have transformed Algeria's once placid periphery into a collection of failed states which are providing a breeding ground for terrorism that poses a serious threat to the oil-rich country. A group called Soldiers of the Caliphate, swearing fealty to Islamic State of the Iraq and the Levant, known as Isis, is one of the latest to declare itself. "Isis is present in Algeria now," said Ismail Maarouf, a political scientist at the University of Algiers. They are . . . known to exist in an area not 30km from the capital. After long isolating itself from regional affairs, the leaders of Africa's geographically largest nation have in the past year become more active players in their own backyard, both militarily and diplomatically. "They're this huge power that wasn't using its influence," said Kal bin Khaled, a Washington-based north Africa specialist and blogger. Now they're openly talking about themselves as a security provider in the region, as a leader. Algeria has for decades confronted its own insurgency, born of the 1992 military coup against Islamists who were on the verge of taking power in democratic elections. A January 2013 attack by Islamists at the In Amenas gas facility near the country's southeastern border with Libya exposed its vulnerability to the wider chaos engulfing north Africa and the Sahel since the Arab uprisings erupted in 2011. The killing of a French mountaineer by the Soldiers of the Caliphate in Algeria in September increased concerns over transnational terrorism making its way to a country of 36m - the second-largest in the Arab world - that poverty and lack of opportunity has filled with disaffected young men. "It's widespread chaos in the region," said Karim Amellal, a French-Algerian political science lecturer at Sciences Po and founder of Algerian news website ChoufChouf. The terrorist threat inside the country is real and could emerge dramatically once more because of the situation in the neighbourhood - mainly because of Libya and the Sahel. In response, Algeria's security forces have expanded co-operation with the US and France, even as they blame both for leading interventions in Libya - where factions who fought Muammer Gaddafi have turned on each other - that are perceived as the root cause of militant threats across the region. The country has bolstered troop deployments along its long desert borders, launched air strikes on suspected insurgent positions within Algeria, spearheaded joint patrols with Tunisian counterparts and sent troops to Russia for counterterrorism training. In August it finalised a deal with Germany's Rheinmetall Defence to build a €28m armoured personnel carrier factory. "They are following [the insurgents] within the desert, through the small cities and towns," said Haithem Rabbani, an adviser to Ali Benflis, a former Algerian prime minister. Now the life of those groups is very difficult, not like three or four years ago. But robust diplomacy lies at the core of Algeria's international counter-terrorism efforts. In addition to its efforts on Mali, Algiers is seeking to host reconciliation talks between Libya's warring factions and played a key role mediating between Islamist and secular leaders in the relatively smooth transition process unfolding in Tunisia. "Tunisia looks like most successful application of the Algerian approach," said Mr Bin Khaled. "They go to the neighbouring country and say, "We have things we can offer. We can offer you intelligence."" When oil-rich Algeria offered cash-strapped Tunisia $250m in financial assistance in May, headlines in Tunis described Algeria as a "big brother" coming to the rescue. But it is Libya, which shares a 990km border with Algeria, that poses the greatest challenge. Algeria's efforts at hosting talks between the warring factions have so far failed and as Libya implodes it is becoming a haven for extremist groups. Worried about the flow of weapons and militants from its neighbour, Algeria is reportedly contemplating constructing a 120km electric fence along part of the frontier. "They're always concerned about Mali, which they see as in their backyard, and they're less concerned that Soldiers of the Caliphate will grow or metastasise," said Geoffrey Porter, founder of North Africa Risk Consulting. But they're very concerned about Libya. Additional reporting by Mariam Metwally