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Egypt turns to ailing economy, Morsi defends vote

President Mohammed Morsi has signed into law Egypt's controversial new constitution and told the nation that its next task is to fix the economy. Egypt's pound has neared an all-time low, prompting a rush at the banks.

Essam el-Erian vice chairman of the Freedom And Justice party, speaks during a session at the Shura Council building in Cairo, Egypt, Wednesday, Dec. 26, 2012. The official approval of Egypt's disputed, Islamist-backed constitution Tuesday held out little hope of stabilizing the country after two years of turmoil and Islamist President Mohammed Morsi may now face a more immediate crisis with the economy falling deeper into distress. (Foto:Mohammed Asad/AP/dapd)

Verfassungsreferendum in Ägypten Essam el-Erian

In his latest televised address Wednesday, Morsi said Egypt's economy faced "huge challenges" but had "great opportunities to grow." He said he was considering a cabinet reshuffle to as part of his plan to attract investors.

His office had earlier announced that Morsi had formally signed into law the constitution, which the opposition has condemned as being too Islamist. The text got 64 percent approval in a two-stage referendum that drew only a third of all eligible voters.

The opposition National Salvation Front coalition said it would launch a legal challenge over alleged voting irregularities.

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Morsi makes economy top priority

Upper house assumes powers

Egypt's upper house of parliament, the Islamist-majority Shura Council (pictured above), convened for its first session on Wednesday, as it took over full legislative powers temporarily.

These powers are to be transferred to a new lower house after fresh parliamentary elections due in two months' time.

Adding to Wednesday's developments, communications minister Hany Mahmoud announced his resignation, citing what he termed his "inability to adapt to the government's working culture."

During his address Wednesday, Morsi said the constitutional referendum had been held in total "transparency and under the full supervision of civil society and the judiciary."

Vetting of the poll - held on 15 and 22 December - was boycotted by some judges.

Economic uncertainty grows

In Cairo on Wednesday, residents expressed frustration about economic uncertainty as the Egyptian pound traded as low as 6.18 against the US dollar. That was near an all-time low set in 2004.

A Cairo-based bank dealer quoted by Reuters said customers were "rushing to buy (US) dollars in the wake of Monday's downgrading of Egypt's long-term credit by the ratings agency Standard and Poors.

"All customers are rushing to buy dollars after the downgrading," said the dealer.

On Tuesday, Egyptian authorities tightened currency controls, banning people leaving or entering Egypt from carrying more than $10,000 (7,600 euros) in cash.

Much still to do, says Germany

Germany has called on President Morsi to work to unite the country following the ratification of the new constitution.

"I call on President Morsi to approach all forces in society and to seek political compromises that involve all Egyptians," said Foreign Minister Guido Westerwelle, adding that that the process of political reform in Egypt was far from complete.

ipj/mz (Reuters, AP, dpa, AFP)

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