Egypt braces for more protests as Mursi remains defiant

Egypt braced for a new round of demonstrations after a defiant Islamist President Mohamed Mursi showed no signs of a compromise on his controversial decree which granted him sweeping powers and sparked violent protests that left seven people dead and nearly 700 injured.

Addressing the nation in a live televised speech on Thursday night, Mursi refused to withdraw the controversial edict he issued and vowed to go ahead with a referendum on the new constitution on December 15.

Mursi said he respects peaceful opposition to his decisions but will not tolerate violence.

He condemned those involved in the clashes -- referring specifically to those with weapons and who are backed by members of the "corrupt ... ex-regime" -- and promised they'd be held accountable.

"(They) will not escape punishment," the president said.

In his speech, Mursi said more than 80 people had been arrested after days of violent protests.

The struggle between anti and pro-Mursi demonstrators transformed the area around the Presidential Palace in Cairo into a war zone. Tanks and armoured cars were positioned outside the Presidential Palace to keep the protesters at bay.

He offered to hold dialogue with the opposition and to meet their representatives tomorrow in his office.

Minutes after the speech ended, the Muslim Brotherhood headquarters in Cairo was set "ablaze," state TV reported, citing witnesses.

Police also fired tear gas to disperse hundreds of protesters gathered outside the president's house in his hometown of Zagazig, north of Cairo.

The Islamist group said on its website and Twitter that the building had come under "a terrorist attack," with hundreds surrounding it -- though there was no sign of a fire or significant damage.

On Twitter, the Brotherhood has said it will hold opposition figures "fully responsible for escalation of violence and inciting their supporters."

Adel Saeed, a spokesman for Egypt's newly appointed general prosecutor, said that Hamdeen Sabahi, Mohamed ElBaradei and Amr Moussa are being investigated for allegedly "conspiring to topple" the government.

But an opposition spokesman said the president had missed a historic chance for compromise.

Nobel prize winner ElBaradei, who is chief co-ordinator of the opposition National Salvation Front movement, expressed dismay at President's speech.

"We had hoped that the president would answer the continuing calls to rescind the constitutional decree and delay the referendum until there's national consensus on the constitution," he said in a televised address.

"We had wanted the president to have a comprehensive dialogue to save the country from the split that threatens it."

US President Barack Obama last night called Mursi to express his "deep concern" over the recent violent protests, the White House said.

He welcomed Mursi's call for talks, but stressed they should be "without preconditions", a statement said.

The November 22 edict by Mursi, in which he made his decisions immune to judicial oversight until a new constitution is voted upon, set off the latest wave of political unrest.

Ahead of the president's speech, opposition leaders demanded that Mursi must roll back his edict granting himself expanded presidential powers and must postpone the scheduled December 15 referendum on constitution, which they say doesn't adequately represent or protect all Egyptians.

They accused him of consolidating power for himself and the Muslim Brotherhood, in part by having an Islamist-dominated group push through the draft constitution.

Four Mursi advisers have resigned over the crisis.