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Egypt's Politics Heighten Risk of Currency Crisis: Analysts
CNBC.com | April 03, 2012 | 05:58 AM EDT

The nomination of a senior member of the Muslim Brotherhood to run in Egypt's presidential race has further clouded an already complex political transition, making an immediate economic recovery less likely and heightening the risk of a currency crisis, according to analysts.

Khairat Al-Shater, a wealthy businessman and long-time member of the Muslim Brotherhood, becomes the third Islamic candidate to participate in the country's first presidential elections since the fall of Hosni Mubarak last year. The vote is slated to begin on May 23.

"The announcement of Mr. Al-Shater as the official Muslim Brotherhood/Freedom and Justice Party candidate for president means that the race will be more open than we might have assumed, even a few weeks ago," Angus Blair, Chairman of the Signet Institute, a Cairo-based think tank, told CNBC.

After a long-standing commitment not to field a candidate, the decision marks a policy reversal for the Muslim Brotherhood (MB). The move may further reflect a growing divide between the ruling military council and the MB, as well as rifts from within, analysts said.

"The change of plan could give the impression to international observers that the political transition may be turning messy and heighten the risk of a derailment in the process," Philippe Dauba-Pantanacce, senior economist, Turkey, Middle East and North Africa at Standard Chartered Bank, said.

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