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November 25, 2012 6:56 pm
Egypt’s benchmark index shed almost a tenth of its value as the country appeared headed into a new phase of political and economic turbulence after the president issued a decree awarding himself almost unchecked powers.
As the EGX-30 index lost some $5bn and opposition parties prepared for big demonstrations this week, Mohamed Morsi’s office on Sunday emphasised “the temporary nature” of his new powers and called for dialogue.
The president issued an edict on Thursday which placed beyond legal challenge all his decisions for an indeterminate period of time to end when a new parliament has been elected, probably towards the middle of next year.
He also forbade the judiciary from issuing rulings disbanding the Islamist-dominated upper chamber of parliament and a controversial panel drafting the country’s new constitution. His move has provoked the anger of liberal forces and the courts which have been considering challenges against the two bodies.
The Egyptian market had risen by 35 per cent since the election of Mr Morsi in June, making it one of the best performing in the world. An initial agreement signed last week with the International Monetary Fund for a $4.8bn loan had raised hopes that the Egyptian economy, battered by two years of political unrest, might turn a corner and start attracting investment.
Mr Morsi’s decree has, at least momentarily, united the country’s fragmented secular and liberal opposition groups who have called for a day of marches and protests on Tuesday. In response, the president’s Muslim Brotherhood group, which is capable of bringing out tens of thousands of people on the streets, is also preparing a rally on Tuesday. Over the weekend scores of demonstrators erected a protest camp in Tahrir Square – the scene of large protests on Friday and the epicentre of last year’s revolt which ousted President Hosni Mubarak – and closed the square to traffic.
Brotherhood officials say Mr Morsi had to issue his edict in order to prevent senior judges, some of whom make no secret of their hostility to the Islamists, from derailing the democratic transition. The Constitutional court has already disbanded the Islamist majority parliament elected this year after it declared the electoral law was unfair to certain candidates. “Without doubt there is a plot to bring down the president,” said Mahmoud Ghozlan, a senior Brotherhood official. “He had no choice but to issue this declaration.”
But Rabab al Mahdi, a political scientist, said the powers the president awarded himself are beyond what is necessary to protect nascent elected institutions from a hostile judiciary.
“The edict gives him the authority to issue any decision he deems necessary to protect the revolution, national unity and the institutions of the state,” she said. “This leads to dictatorship and it is fascist. We have now reached a turning point that will decide what political system we have for decades.”
At the weekend bodies representing the country’s judges denounced Mr Morsi’s moves as an assault on the independence of the judiciary. However, a call by the Judges Club, a professional association, for a strike by courts was only partially observed on Sunday.
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