The Entrepreneur at the Heart of Egypt’s Muslim Brotherhood: A Profile of Muhammad Khayrat al-Shater

Andrew McGregor

July 31, 2013

Over the last three years, Muslim Brotherhood deputy guide Muhammad Khayrat al-Shater has gone from being a political prisoner in Egypt’s prisons to a controversial role as the alleged “power behind the throne” in the Muhammad Mursi presidency and back again to prison, where he now faces serious charges of ordering the massacre of nine protesters outside the Muslim Brothers’ headquarters in Cairo. Undoubtedly one of the most important figures in Egypt today, al-Shater will need to use his considerable resources and enterprise to overcome the popular resentment and military distaste created by his role as an un-elected leader during Egypt’s post-revolution economic and security collapse.


Khayrat al-Shater During his Short-Lived Campaign for President, April 2012

Background

Born in 1950 in the Dakahlia governorate in the Egyptian Delta, al-Shater became a student activist while doing undergraduate studies in civil engineering and taking a Master’s degree in construction management in Alexandria. By 1974, al-Shater had joined the Muslim Brotherhood, along with a fellow student, Hassan Malik, who became al-Shater’s long-time business partner and fellow member of the Muslim Brotherhood. The two launched Salsabil, an early and highly successful software business, in 1983, using their new-found wealth to increase their influence within the still officially banned Muslim Brotherhood. Their success drew the attention of President Hosni Mubarak’s security forces, which detained the two on allegedly fabricated charges, forcing the temporary closure and confiscation of the business.

Both men would serve over a year in prison without trial, with al-Shater being released in 1993 to resume his climb within the Brotherhood to become a member of the movement’s all-important Guidance Bureau and head of the Brotherhood’s Cairo branch at the relatively young age of 35 in 1995 (al-Ahram, March 29, 2012; Egypt Independent, February 13, 2012). [1] Al-Shater also earned his first conviction the same year, serving a five year term along with 54 other Muslim Brothers for his role in reorganizing the Brotherhood as a potent social and political force.

Under the Mubarak Regime

In 2001, al-Shater was again detained as the prime suspect in a case against 25 members of the Muslim Brotherhood on charges of belonging to a banned organization and disseminating materials promoting the group’s doctrines (al-Akhbar [Cairo], August 13, 2001).

With arrests and detentions becoming frequent, prison became an important part of al-Shater’s life, an experience he described in a 2011 interview:

[The Brothers] were not tortured or punished severely but we suffered from psychological oppression when we were arrested and prevented from practicing political activism. The treatment differs and I became experienced about life in prison after I was detained several times. Our treatment all the time was good, despite the instructions of the regime. They treated us with excessive respect and when Mubarak and [Interior Minister] Habib al-Adli fell, several prison administrators came to congratulate us on the fall of the regime, saying: “God avenged you; He did to them what they did to you and more” (al-Sharq al-Awsat, March 8, 2011).

In 2006, al-Shater was arrested in a round-up of prominent Muslim Brothers only a year after the movement had attained considerable success in the 2005 elections by running members as independent candidates. By 2008, the government had amended the constitution to prohibit independent candidates from standing for election.

Al-Shater was again arrested along with 28 other members of the Brotherhood in January 2007 after a December, 2006 military-style demonstration by al-Azhar students affiliated with the Brotherhood alarmed the Mubarak regime and many Egyptians. A further 72 members were arrested in mid-February, 2007 as the government attempted to squash any revival of the Brotherhood’s military wing (AFP, February 15, 2007).

In 2008, al-Shater was one of 40 members of the Brotherhood who were charged with money laundering and membership in a banned group and brought before a military tribunal (MENA, September 13, 2008). Ultimately, 25 members were convicted, including al-Shater and business partner Hassan Malik, who were each sentenced to seven years in prison (MENA, April 15). It was al-Shater’s second conviction.

Revolution and Presidential Candidacy

Al-Shater was still behind bars as Egypt’s January 25, 2011 revolution expelled Mubarak and shattered the internal security forces that had persecuted the Brotherhood for decades. According to al-Shater, he had planned to retire at age 60 in 2000, but when he found himself behind bars at that age, he did not announce his retirement for fear that people would “think that I retreated, weakened, or got tired of prison… Then the revolution came” (al-Sharq al-Awsat, April 13, 2012). Al-Shater found himself released early from prison in March, 2011 for health reasons.

Not long after his release, al-Shater was reported to have played a major role in forcing the resignation from the Brotherhood of former Guidance Bureau member Abd al-Mun’im Abu’l-Futuh over the latter’s decision to run for the presidency while the movement was still against fielding a presidential candidate. The expulsion helped alienate al-Shater from the movement’s youth wing, which was a strong supporter of Abu’l-Futuh’s reform efforts (The National [Abu Dhabi], July 2).

In the days after the revolution, the Brotherhood stuck closely to its commitment to grass-roots political development, pledging that it would not run a candidate for president. When al-Shater was asked about public doubts that he would honor his pledge not to compete in the upcoming elections, al-Shater replied: “We do not renege on our promises. This is an issue of faith; we do not maneuver with our God” (al-Sharq al-Awsat, March 8, 2011).

Khayrat al-Shater

Despite warnings from fellow Islamists that changing this strategy would only lead to embarrassment and public resentment, the troika of al-Badi, al-Shater and al-Mursi eventually decided to take the electoral plunge by running al-Shater for the presidency and risk the future of the movement in return for a chance to take power immediately. Al-Shater said that the move was the result of concerns within the Brotherhood that the army was failing to cooperate with the Brotherhood-dominated parliament and thus needed a figure in the executive to change this situation without provoking a direct clash with the military (Reuters, April 8). Having decided to run a candidate for president after having repeatedly stated that the Brotherhood would not do so, the movement performed a slight-of-hand that fooled no-one, with al-Shater resigning from the Brotherhood before announcing his candidacy (al-Akhbar [Cairo], April 3, 2012).

The greatest obstacles to al-Shater’s candidacy were his two criminal convictions in 1995 and 2008, which barred him from running for an official post under Egyptian law. Help came from an unexpected quarter when the Egyptian military dropped the convictions, clearing him to run (Jordan Times, April 2, 2012).

Many prominent members of the Brotherhood opposed nominating a presidential candidate, believing that it was too soon to make such a move. Among the opponents was the deputy leader of the Freedom and Justice Party (FJP – the political wing of the Brotherhood) and member of the Brotherhood’s Guidance Bureau, Isam al-Iryan, who explained: “To assume power in a country of a large size while you have not been part of its machine, in which you do not have employees, former ministers or experts who are aware of the details and while you do not have the security or information apparatuses, and while you do not have anything, is a great risk” (al-Hayat, June 30).

Senior Brotherhood figure Kamal al-Helbawy resigned in protest at the movement’s policy reversal, accusing the Brotherhood’s leadership of acting in ways that differed little from the previous regime: “The Brotherhood had initially stated that its political party, the Freedom and Justice Party, would only contest a third of Parliament’s seats. Now they control almost half. At the same time, the group’s leadership, which many speculate is dominated by Shater’s will, began to ostracize members who didn’t go along with their political agenda” (al-Hayat, April 2).

Muhammad al-Mursi, still leader of the FJP at the time, attempted to allay fears that al-Shater would attempt to monopolize the leading positions in the state by describing such reports as “baseless” (though al-Mursi himself would eventually be charged doing the same thing while president) (Kuwait News Agency, April 1, 2012).

On April 17, 2012, Egypt’s electoral commission issued a final ruling barring al-Shater and nine other would-be candidates from running for president, though the candidacy of al-Shater’s rival Abd al-Munim Abu’l-Futuh was approved. In al-Shater’s case, his candidacy was rejected as he had not passed the six year period required since his release from prison. Al-Shater noted the irony in being barred from running for office on account of being imprisoned by the man who had just been overthrown as an unjust tyrant by a popular revolution (Egypt Independent, April 18, 2012; April 23, 2012). With his run for the presidency out of the question, the Brotherhood restored al-Shater to his position as deputy leader and advanced Muhammad al-Mursi as a successful alternate candidate in the May 2012 election. Al-Shater held the Supreme Council of the Armed Forces (SCAF) responsible for the electoral commission’s decision and suggested the military was trying to manipulate the post-revolution succession: “It is not about Khairat al-Shater. It is clear that there are specific attempts with clear evidence to manipulate the transition to democracy and to bar the people from choosing their president and government in a genuine and democratic way… Perhaps the Supreme Council of the Armed Forces wants a president who is loyal to it… we are seeing a clear attempt to reproduce the former despotic regime with few amendments” (Egypt Independent, April 18, 2012).

A Businessman in an Islamist Movement

Al-Shater controls a large economic empire, though due to the former regime’s habit of seizing the business interests of political detainees, few of these holdings are actually in al-Shater’s name. Nonetheless, it is possible to connect al-Shater to the family holding company, the Egyptian Company for Renaissance and Integrated Development and a host of other firms involved in information technology, furniture sales, clothing production and call centers (The National [Abu Dhabi], July 2). Al Shater’s son, Sa’ad, operates Zad, a chain of supermarkets aimed at using discount pricing to attract lower-middle-class consumers. According to an Egyptian daily, al-Shater is a major shareholder in Zad, though his shares are registered under the name of his son-in-law (al-Masry al-Youm [Cairo], July 15).

Al-Shater typically downplays his financial holdings: “I do not have many commercial businesses. The image portrayed in the media does not exist; there is not even one percent of what is rumoredduring the past 19 years, I spent 12 years in prison in four batches; therefore, I have not been able to manage my businesses. Whenever I started a company, the authorities would imprison me again; when I am released, I would open another company” (al-Sharq al-Awsat, April 13, 2012).

With the Muslim Brotherhood being a banned organization until recently, its finances were kept under the tight and secretive control of al-Shater and Hassan Malik (al-Musawwar [Cairo], May 25, 2007). Despite this, there were few complaints within the Brotherhood over this situation, as al-Shater appeared to run the group’s finances efficiently while still using the distribution of funds as a means of expanding his influence over fellow members. The potential power of anyone controlling the movement’s finances is considerable, given the group’s massive investments in Egypt (including large real estate purchases in Nasr City and 6 October City), donations and fees from within Egypt and remittances from Brothers working in the Gulf or other points abroad.

Contrary to the traditional state (and military) control of most of the Egyptian economy, al-Shater and other Brotherhood figures with extensive experience in business called for an expanded private sector free of corruption that would enhance production and subsequently generate the funds required for establishing social justice (Egypt Independent [Cairo], August 2, 2012). It was this approach, combined with a willingness to work with the IMF and other international financial institutions, that brought al-Shater to the attention of policy-makers in Washington as a man they believed could be dealt with in a discreet and pragmatic fashion while still having the closest possible ties with Egypt’s official political leadership.

Al-Shater recognized the danger in his unofficial role managing Egypt’s rapidly imploding post-revolution economy: “Managing the affairs of Egypt currently is a suicide operation, and it is closer to failure than to success” (al-Sharq al-Awsat, April 13, 2012). For inspiration, al-Shater began to look at abroad, examining the successful economic models in Turkey and Malaysia and the education and health sectors in Singapore.

Al-Shater’s efforts to establish closer relations with Egypt’s Salafist parties ran aground over the question of accepting interest-bearing loans to obtain foreign capital from the international community. Al-Shater’s attempts to persuade the Salafists to overlook the Islamic prohibition of usury in order to obtain funds for social development projects were unsuccessful and resulted only in greater alienation from the Salafist leaders (al-Masry al-Youm [Cairo], February 25).

The Shadow President

As Egyptians began to discuss whether al-Shater was the real power behind the Mursi presidency, directing the economy and maintaining relations with the outside world on behalf of the Brotherhood, the movement’s secretary-general, Dr. Mahmud Husayn, described such assertions as “lies and fabrications” made to “tarnish the image of the president by alleging that someone behind the scenes is guiding him” (al-Sharq al-Awsat, February 14). Despite his obvious influence within the Muslim Brotherhood, al-Shater has been constant in his denials that he is a person of any importance in the government: “Egypt is an institution-based, long-standing state with a great civilization. I have no capacity to interfere in state affairs. All that is said in this regard are rumors that I have no time to deny” (DPA, April 22).

Tharwat al-Khirbawi, a leading member of the Brotherhood until his departure from the movement, described the hierarchy of the Brotherhood in the following way earlier this year: “In the Egyptian Muslim Brotherhood movement, [Supreme Guide] Muhammad Badi’s role is lower than that of a general guide. There are rankings within the organization and the guidance office. Only two have reached the highest ranking in the Muslim Brotherhood movement. The first is Khayrat al-Shatir; the second is [former Guidance Bureau secretary-general] Mahmud Izzat (al-Sharq al-Awsat, March 6).

Isam al-Iryan has insisted that the Brotherhood’s organizational structure precluded the emergence of a “strongman”:

There is no such thing as a strongman for us. The Brotherhood’s major strength is its institutional nature… The Muslim Brotherhood, throughout its history, had only one leader who was in charge. Everyone would take whatever information or suggestions to him. But what is customary for the Brotherhood, unlike what people may believe, is that the Supreme Guide does not act alone, and must make decisions through the institutional frameworks” (al-Hayat, July 9).

Public indignation against Brotherhood rule began to mount earlier this year, with protesters calling for demonstrations in front of al-Shater’s home, accompanied by reported phone calls threatening to burn the building to the ground (Egypt Independent [Cairo], February 16). However, the ambiguous role played by al-Shater in the Brotherhood-based government still allowed him to play an important role in attempts to reconcile the Brothers with the political opposition in early June.

At one point, a meeting was arranged between al-Shater and Amr Musa, a leading member of the opposition National Salvation Front (NSF), leader of the Congress Party and a former secretary-general of the Arab League. According to Musa, al-Shater believed the June 30 demonstrations that eventually overthrew the Mursi government would be little more than a media event.  Despite al-Shater’s insistence that he played no role in the government, NSF members assailed Musa for meeting with the Brotherhood’s deputy guide at a time they were rejecting all meetings with the Mursi regime and Musa was compelled to issue a public apology (al-Sharq al-Awsat, June 7; MENA, June 9). The later remarks of liberal politician Ayman Nur (leader of the Ghad al-Thawra party), who hosted the meeting in his home, give some indication of how Egypt’s leading politicians viewed al-Shater. According to Nur, the meeting was held with al-Shater because he was the most powerful member of the Brotherhood but his lack of an official role in the government meant the opposition was not violating a pledge to avoid direct talks with the Mursi regime: “During the meeting, Khayrat said he was not participating in the presidency in any way, but we felt that what he said was what mattered” (The National [Abu Dhabi], July 2).

Popular Uprising and Military Takeover

By the time of the June 30 mass demonstrations that brought a premature end to the Mursi presidency, al-Shater had become a public symbol of the Brotherhood’s secrecy and ambitions. Despite his efforts to maintain a low profile, al-Shater’s image and name figured prominently in the posters and chants of the anti-Brotherhood demonstrators. The denouncements translated into physical jeopardy when a group of men including police officers fired shots at his Nasr City home on July 1 (The National [Abu Dhabi], July 2). Though police spokesmen denied the attack, al-Shater’s daughter Khadijah said the participation of policemen had been recorded on video (Ikhwanonline [Cairo], July 1).

On July 4, arrest warrants were issued for al-Shater and Supreme Guide Muhammad al-Badi in connection with the July 1 killing of nine protesters and the wounding of 45 at the Muqattam headquarters of the Brotherhood after gunmen of the movement’s youth wing opened up on an anti-Brotherhood demonstration with firearms from within the building. Al-Shater was arrested at his Nasr City apartment the next day, following the July 1 arrest of fifteen of his bodyguards (MENA, July 4, Reuters, July 1; July 5). Also charged in the case were former Brotherhood Supreme Guide Muhammad Mahdi Akif, FJP leader Muhammad Sa’id al-Katatni and Brotherhood co-deputy leader Muhammad al-Bayyumi (MENA, July 7). Al-Shater denied all knowledge of the incident at the Brothers’ Muqattam headquarters, claiming he learned about it from a broadcast he heard in his apartment miles away in Nasr City (al-Masry al-Youm [Cairo], July 17).

Youth members of the movement had been assigned to protect Brotherhood offices after the movement’s Muquttam headquarters was attacked by demonstrators in late March (al-Masry al-Youm, March 27). According to al-Shater, those inside the building were acting in self-defense: “The charges should be brought against those who attacked the headquarters, for destroying and burning private property” (al-Masry al-Youm [Cairo], July 6). In another sign of how low the Shater family fortunes had suddenly dropped, three Zad supermarkets in al-Shater’s native Delta region were looted while police looked on (The National [Abu Dhabi], July 2).

Conclusion

As al-Shater awaits trial under detention with the looming possibility of an extended term in prison ahead of him, the Muslim Brotherhood’s deputy guide acknowledges that the Egyptian revolution is an unfinished process, though he still prefers to identify lingering elements of the Mubarak regime (including the military) as the biggest obstacle to Islamist rule and Egyptian prosperity. Sa’ad al-Shater visited his father in prison on July 18 and returned with a message in which al-Shater declared Egypt’s problems will be solved by purging all remnants of the former regime: “He said there must be a revolution to uproot the corrupt who want to make a come-back to rob the country. He also said old regime holdovers are trying to loot the country’s resources. Nothing will stand in their way short of a real revolution that will uproot all the deep state” (IkhwanWeb [Cairo], July 19).

Note

  1. 1. http://www.washingtoninstitute.org/policy-analysis/view/whos-who-in-the-muslim-brotherhood

This article first appeared in the July 31, 2013 issue of the Jamestown Foundation’s Militant Leadership Monitor

Nigerian Army Abandons Peacekeeping Missions in Mali and Darfur to Combat Boko Haram

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Nigeria has begun to pull back troops from peacekeeping missions in Mali and Darfur as its two-month-old offensive against Boko Haram militants begins to falter even as northern Nigerian extremists turn to soft targets to disrupt the efforts of security forces. Launched on May 14, the offensive has proved controversial from the start, with critics describing it as ineffective and shockingly casual in its regard for civilian lives.