(Reuters) - President Mohamed Mursi will speak to the Egyptian people on Wednesday in a televised address that could determine his political survival as millions prepare to rally to demand his removal this weekend.
Fears of a showdown in the streets between Mursi's Islamist supporters and a broad coalition of the disaffected have led people to stock up on food and buy up fuel supplies.
The army and police are preparing to contain any trouble, adding men and barriers around important public buildings.
Mursi has given no hint of the contents of what aides called an "important speech", to start around 9:30 p.m. (3:30 p.m. EDT) at a Cairo stadium before an invited crowd. Some speculate he may reshuffle his cabinet to try to defuse the anger against him.
Some observers fear Egypt may be about to erupt again, through a combination of political polarization since the revolution that overthrew Hosni Mubarak and an economic slump that means Mursi's government is fast running out of cash.
While a number of his critics worry about Islamist rule, most appear simply frustrated by falling living standards.
Washington has urged him to bring the opposition into the political process and to press ahead with economic reforms.
All sides insist they do not want violence, but there have been scuffles, and deaths, in recent days. The army has warned it could step back in, a year after it handed power to the elected president. Residents saw tanks taking up positions near a major highway running into Cairo.
The army is held in high regard by Egyptians, especially since it pushed aside Mubarak following the 2011 uprising. Its chief issued a warning on Sunday, urging compromise while also defending the legitimacy of Mursi's election.
The loyalty of police and other internal security services to a government led by Islamists they spent decades oppressing under Mubarak may be in question. Nationwide opposition rallies, are due to start on Sunday but could begin earlier.
Mursi says a petition demanding he quit - which liberal organizers say has 15 million signatures - is undemocratic. In that, he has support from Islamists, who have staged shows of strength in recent days and plan a major Cairo rally on Friday.
But both the army and many outsiders have been urging Mursi to bridge differences with his non-Islamist opponents. He says he has tried. They say he and his Muslim Brotherhood, along with harder line allies, are trying to monopolize the state.
LOW EXPECTATIONS
"This demonstration is spontaneous and comes from the Egyptian people. We hope that it will bring the government ultimately to a place where the reforms are effected and choices that need to be made about the economy are implemented," U.S. Secretary of State John Kerry said on Tuesday in Saudi Arabia.
"We will obviously hope that it will not produce violence and be a moment of catalyzing positive change for Egypt itself."
In his speech, Mursi may offer a rundown of achievements since he became Egypt's first freely chosen leader and explain how he plans to end a mounting budget crisis. He has had help from Qatar and other oil-rich Arab states but major reforms, including cuts to fuel and food subsidies, may be needed.
Mursi may announce a cabinet reshuffle, possibly replacing Prime Minister Hisham Kandil with a figure from among the secular opposition. There is also talk on social media of some more spectacular move, turning to the army or calling elections.
The opposition have low expectations. Liberal activists plan to watch the speech on an open-air screen in Cairo's Tahrir Square, where revolt against Mubarak began in January 2011.
Liberal coalition spokesman Khaled Dawoud said: "He missed several opportunities in the past to build bridges with the Egyptian people. At this point, it's too late for any possible measures short of early elections, to stop the demonstrations."
Dawoud likened Mursi's address to televised speeches made by Mubarak during the revolt. Mubarak fired his prime minister in a vain attempt to appease the crowds on the streets. His army turned against him and eased him aside after 18 days.
For ordinary Egyptians, the main concern today is economic hardship, especially since the unrest of the revolution scared off tourists, cutting a vital source of income. Power cuts and fuel shortages have been the talk of the country for weeks.
In Cairo and other cities, long lines of vehicles have formed at fuel stations.
Among criticisms of Mursi, a less than charismatic speaker who became the Brotherhood's presidential candidate as a last-minute stand-in, is that he has turned for support to harder line Islamist groups, including former militants.
The lynching of five people from the Shi'ite Muslim minority on Sunday revived fears among minorities, including Egypt's several million Christians, and was used by the opposition to portray Mursi as tolerant of an extremist fringe.
(Additional reporting by Shaimaa Fayed, Patrick Werr, Yasmine Saleh, Omar Fahmy and Shadia Nasralla in Cairo; writing by Alastair Macdonald; editing by Philippa Fletcher)
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