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Egypt on Sunday appointed a new ambassador to Israel to fill a post that had been vacant since ousted Islamist president Mohamed Morsi recalled the previous envoy in 2012.

State news agency MENA said that Hazem Khairat, a former ambassador to Chile, was appointed by President Abd al-Fattah al-Sisi. It did not say when he will take up his post.

Khairat's appointment was immediately "deeply" welcomed by Israeli Prime Minister Benjamin Netanyahu.

"We’ve been informed by the government of Egypt that it is dispatching an ambassador to Israel. This is an important piece of news, we appreciate it," Netanyahu said in Jerusalem.

"It's something that is deeply welcome in Israel, and I think it's very good for cementing the peace that exists between Egypt and Israel," he said at a joint news conference with French Foreign Minister Laurent Fabius.

Egypt was the first Arab country to sign a peace treaty with Israel in 1979. Jordan followed suit in 1994.

Ties between the two neighbours soured after Morsi's June 2012 election as president following the ousting of his predecessor Hosni Mubarak in the 2011 uprising.

Morsi recalled Egypt's envoy to Israel in November 2012 to protest against a series of Israeli air raids on the Gaza Strip that killed top Hamas militant Ahmed Jaabari.

He was killed at the start of an eight-day Israeli operation dubbed 'Pillar of Defence' in which 177 Palestinians and six Israelis were killed. The violence stopped after Egypt brokered a truce.

The ambassadorial appointment is part a large shake-up in more than a dozen Egyptian diplomatic missions from Asia to the North America including new posts in Washington DC, the Vatican, Berlin, Croatia, Oman, the Czech Republic and Pakistan. 

Morsi was ousted by then army chief Sisi in July 2013, his death sentence was upheald last week for 'plotting jailbreaks and attacks on police' during the 2011 uprising.

Later that year, the Israeli foreign ministry named Middle East specialist Haim Koren as its next ambassador to Egypt.