Muslim Brotherhood to be banned in Egypt

24 September 2013

Concerns raised that Muslim Brotherhood ban will have an impact on Egypt’s stability

An Egyptian court has banned the Muslim Brotherhood from conducting any activities in the country. This is the latest move in a crackdown on the organisation since the brotherhood-backed former president Mohammed Mursi was removed from power by the military on 3 July.

Several high-profile members of the brotherhood have been arrested in the past month ,including its leader Mohammed Badie and the organisation’s main English-language spokesperson Gehad el-Haddad. In mid-August, hundreds of brotherhood supporters were killed when Egypt’s security forces cleared pro-Mursi protest camps set up in Cairo’s squares.

Following the violence, a state of emergency was imposed. This was extended by a further two months in mid-September.

The banning of the brotherhood once again pushes the organisation to the sidelines of Egyptian society, after having enjoyed a brief period of popular support. The Muslim Brotherhood was formed 85 years ago, but banned by the military in 1954. Following the overthrow of President Hosni Mubarak it legally formed the Freedom and Justice Party, which brought Mohammed Mursi to power in June 2012.

There are concerns the ban on the brotherhood could further draw out Egypt’s long-term economic recovery. Raza Agha, chief economist, Middle East and Africa, at the London office of Russian investment bank VTB Capital, says the brotherhood should be included in any new government.

“We strongly believe that if Egypt is able to navigate the transition to a new, inclusive government that does not marginalise any particular group (read: Muslim Brotherhood), a macro-rebound will be quick and just as dramatic as the downturn has been,” he says.  

Egypt’s economy has been temporarily buoyed by billions of dollars of financial aid from Saudi Arabia, Kuwait and the UAE.

Immediately following the ousting of Mursi, Saudi Arabia pledged a total of $5bn, while Kuwait pledged a further $4bn and the UAE pledged $3bn. In mid-September, Kuwait deposited $2bn into Egypt’s Central Bank.

The crackdown on the brotherhood is likely to be welcomed by GCC countries, which have historically had a poor relationship with the organisation. “Our worry is that the benevolence of Egypt’s Gulf creditors may actually have inadvertently, or not, emboldened the current army-backed government to take action against the Muslim Brotherhood harsher than initially planned,” says Agha.

In mid-September, Egypt returned the $2bn Qatar had previously deposited in the central bank after talks to convert it into a three-year bond failed. The return of the funds reflects the breakdown in relations between Cairo and Doha.

Qatar has been a supporter of the previous Mursi regime and lent billions of dollars to the Muslim Brotherhood-backed government.

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