Egypt's Morsi gets to work on forming new cabinet

CAIRO (AFP) - President-elect Mohamed Morsi was on Tuesday drawing up a battle plan to confront Egypt's economic and security crises as he pushed ahead with selecting a government of technocrats, a senior aide said.

Egypt's first civilian president, and its first elected leader since an uprising ousted president Hosni Mubarak early last year, went straight to work after he was declared the election winner on Sunday, the aide said.

Following a historic victory against former Mubarak premier Ahmed Shafiq, the Islamist must now try to live up to campaign pledges he undertook to gain the support of pro-democracy groups in defeating Shafiq.

The former senior member of the Muslim Brotherhood will try to select a government that will be inclusive of other political forces who reluctantly supported him against Shafiq.

Morsi, who resigned from the Brotherhood after his win, also has to contend with a ruling military that will maintain broad powers even after it formally transfers control at the end of June.

A senior aide to the first Islamist president in the country's modern history said Morsi was conducting talks to appoint an "independent national figure" as his premier.

"Most of the cabinet will be technocrats," he added, requesting anonymity because the presidency had not yet settled on its official spokesman.

The official Al-Ahram newspaper reported on Tuesday that Morsi was considering Nobel Laureate Mohamed ElBaradei or former finance minister Hazem Beblawi for the post of prime minister.

Beblawi told AFP that he was abroad and had not yet been contacted by the presidency.

Morsi was also "deep in study to finetune his programme's priorities," the president-elect's aide added.

Morsi has pledged to restore security and improve the economy, in tatters since the anti-Mubarak uprising, to tackle fuel shortages and organise the cities' traffic and garbage problems.

On Monday, Morsi met the head of the government-appointed cabinet, which submitted its resignation but will continue in a caretaker capacity until a new cabinet is sworn in.

He also met Egypt's military ruler, Field Marshal Hussein Tantawi, in what official media described as an amiable meeting between the country's two most powerful men following months of acrimony between the generals and Islamists.

A picture on the front page of the state's flagship Al-Ahram daily showed the bearded Morsi sitting alongside Tantawi in the manner of a visiting head of state, a reminder of where power lies in a country ruled for decades by military men.

The military, in direct charge of Egypt since Mubarak's overthrow in a popular uprising, has said Morsi will assume full presidential powers when he takes office on June 30.

But in two decrees this month, the military took over parliament's power after disbanding it following a court order and formed a national security council dominated by generals which will have a large say in policy-making.

In Cairo's Tahrir Square, Muslim Brotherhood cadres continued a days-long sit in to pressure the military to hand full powers to Morsi and restore the parliament.

Morsi himself has said that although he accepted the court order to disband the Islamist-dominated parliament, he disagreed with it.

"He wishes he can take his oath in front of parliament," his aide said, as stipulated in the country's interim constitution. But in its absence Morsi will have to take the oath before the constitutional court.

Morsi's main priority will be to try to check the downward spiral of the country's battered economy, which relies heavily on tourism.

The Cairo stock exchange closed up 7.5 percent on Monday at 4,482.48 points, its largest single-day increase in more than a year, amid optimism that the official announcement of a president would help stabilise the country.

But ratings agency Standard and Poor's said it was placing its 'B' long-term foreign- and local-currency sovereign ratings on Egypt on CreditWatch with negative implications.

"The CreditWatch placement reflects our view of at least a 50 percent likelihood of a downgrade over the next three months," the agency said.