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CNN LIVE EVENT/SPECIAL

Crisis in Egypt

Aired January 29, 2011 - 18:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


WOLF BLITZER, CNN ANCHOR: Tonight, a CNN special report.

(SHOUTING)

BLITZER: The protesters, the looting, the soldiers, the celebrations. Who's in charge? What's at stake? And what will happen next? We're on the ground with every angle. It's Egypt's crisis. But the world is watching.

Good evening. We want to welcome our viewers in the United States and around the world. I'm Wolf Blitzer in Washington.

ISHA SESAY, CNN HEADQUARTERS: I'm Isha Sesay in Atlanta at CNN World Headquarters.

You are looking at live pictures from Alexandria, Egypt, where it is now 1:00 o'clock in the morning. Egyptian President Hosni Mubarak is struggling this hour to maintain his hold on the government and regain control of the country. Here's the status right now of this very fast-moving, highly volatile situation.

Tens of thousands of anti-government protesters again swarmed into the streets of Cairo and other cities demanding that Mubarak step down. Mubarak's key government officials resigned today. He named his intelligence chief as his first ever vice president. Police in the capital fired rubber bullets and teargas in clashes with protesters in at least one strategic place, the interior ministry. Dozens of people have been killed since these protests erupted earlier this week, but there's actually no precise number of the number of dead.

The army has taken up positions in the streets, acting on orders from Mubarak, but so far the military hasn't cracked down on protesters. In many areas what we are seeing is the police have abandoned their positions. Eyewitnesses are reporting that in some Cairo neighborhoods residents armed with sticks, kitchen knives, other weapons they've been able to get their hands on are trying to protect homes and businesses from looters.

Despite the effort of the vigilantes looters managed to bust into Cairo's Museum of Antiquities. There are reports some exhibits were damaged, but Egyptian television is now reporting that nothing was stolen, Wolf.

BLITZER: Isha, let's begin north of Cairo right now in the critically important port city of Alexandria. What started as relatively calm protests grew much more intense. Our Senior International Correspondent Nic Robertson has been in the thick of things on the ground all day.

First of all, Nic, what are you seeing right now? It's obviously middle of the night there.

NIC ROBERTSON, CNN SR. INT'L. CORRESPONDENT: Wolf, the streets are quite deserted. The curfew seems to be having an effect. It came into effect nine hours ago and probably only in the last couple of hours the streets cleared out. The Cornish (ph), the coastal road that runs alongside the Mediterranean behind me, deserted. But to the left of me, here, the back streets of the city -- and I can hear voices of young men through those streets right now, small groups of them. We saw some come out of those alleyways earlier on. Some of them had iron bars. Some of them were carrying machetes. We watched them on the street, just down here, stop an ambulance that was out broadcasting to people here to stay in their homes.

Stopped that ambulance, intimidate the driver, searched the vehicle before it went on. And also, just down over there, I can see a small store where there's a sort of group of vigilantes set up there to protect the shops. That's what's happening here. No police. People are concerned about their private property, Wolf.

BLITZER: It looks like there's been a dramatic shift in the mood over the past 24 hours. There was deep concern about what some of the protesters might be doing, but all of a sudden now random looters, vigilantes, thugs if you will. They're trying to steal stuff. Is that in part what is going on as well?

ROBERTSON: In part, they're taking advantage of the fact that the police were beaten off the streets by the protesters yesterday. Today the protests here have been probably 5,000 to 10,000 people, peaceful, angry, very angry demanding Hosni Mubarak step down. But for the most part, peaceful. But it is on the margins of that the criminal element is taking advantage of the fact there are no police out there to stop them. And as we've seen there's only a tiny handful of army out here. They weren't stopping looters when we saw them looting the remnants of the police station here.

They were positioned outside all last night. They're not taking on and challenging the crowds here. They are really sitting low. I talk to a former army general here and said, look, the soldiers you see there, that the people think are protecting the people, I'm a former general. We were told there's a plan. The plan is protect the president, not the people, Wolf.

BLITZER: You Tweeted earlier, Nic, that some of the scenes at the hospitals in Alexandria were chaotic. What did you see?

ROBERTSON: Hectic. Absolutely hectic. The morgues, there, piling up with bodies, more than 31 people killed in the protests here so far. And in the ward at the hospital, the doctors have cleared out normal patients so they can make room for the huge influx of people that are coming in with injuries from the protests. We've seen people with rubber bullet wounds with cracks on their head, those types of wounds.

The hospital there, they're getting very angry and frustrated with the doctors. The doctors are short staffed because not all the staff are turning up to work. The protesters see the doctors as part of the institutions of the country, part of Hosni Mubarak's regime, if you will. And they're taking their anger out on the doctors. The doctors are just trying to help them. But that's the sort of level of anger and frustration that is erupting.

Remember these are pent-up frustrations in some cases for 30 years. People are just giving voice to them now. They don't really know how to moderate them, Wolf.

BLITZER: Let's remember it's already past 1:00 a.m. an Alexandria and Cairo. Nic, we're going to have you have stand by.

Isha, this story is getting more and more dramatic and the stakes, for the world, right now especially for the people of Egypt are enormous.

SESAY: Absolutely, Wolf. Everyone is watching the situation as it unfolds. This is a fast-developing story, as you rightly said. CNN International Correspondent Ben Wedeman is in Cairo and he joins me on the phone.

Now, Ben, I understand both you, and your wife, are experiencing this unrest firsthand. We noticed a Tweet you posted earlier. I want to put this up on the screen for our viewers. It said, "My wonderful wife has handed out baseball bats, clubs, kitchen knives, and tea to neighborhood patrol." What exactly is going on, Ben?

BEN WEDEMAN, CNN SR. INT'L. CORRESPONDENT: Well, it's a situation typical of so many neighborhoods in Cairo, that the police have disappeared. A presence that we got quite used to, in fact, I knew the policeman on our block. Spoke to him every day. He's gone like all the police in Egypt. And we basically have to figure out how to protect our neighborhood. And like so many other places, neighbors got together and said, we've got to do what we can because nobody else is doing it.

What happened was that when the army came in to Cairo, the police started pulling out. And as the police started pulling out, people attacked the police stations, because the Egyptian police are widely hated for corruption, brutality, torture. Once the police left those police stations, people went in and started stealing the weapons from inside, and now there are weapons in the hands of all sorts of people.

My wife, in fact, called me to say she saw in our neighborhood a group of men, who wrapped scarves around their faces, and were walking around with AK-47s. It's this sort of specter of chaos that had me, most of the day, not working as a journalist, just trying to make phone calls and figure out how I can ensure the safety of my family. I'm working on air quite a while just trying to figure out what to do.

SESAY: It is a tense time there in Egypt, in Cairo. You described the situation for your family. We understand that people who own private businesses are also experiencing the same level of threat. What has been going on there?

WEDEMAN: Well, it appears that after sort of a day of real uncertainty and a lot of violence by it seems criminal elements, and looters, the situation is stabilized. People are really focusing on how to help keep their neighbors safe. So I'm hearing it's more quiet. I have had phone calls from people around the city -- Australians, Canadians, Egyptians -- calling me to find out what they can do to contact their embassies, to contact the authorities, to see how they can be safer.

One woman from Australia told me she's a woman with -- a single mother with four children living in a neighborhood where thieves were going just mad. And I got in touch with the foreign office in Australia to get them to contact her to assure, her that they'll do what they can to make her safe. So it's just been a crazy day of phone calls and trying to make sense of this situation.

SESAY: You sound pretty exhausted, Ben. I can hear it in your voice. Slightly overwhelmed by it all.

WEDEMAN: Yeah. Well, because most of the time, you know, I'm in other places where there are problems, but I'm focusing completely on work. So it's a whole different thing when it's in your home, and your town, the city I've lived in for so many years, where things are just suddenly falling apart. It's only five days. Five days that this has been -- this situation is developing, a situation that nobody really anticipated.

SESAY: Ben Wedeman, we're going to ask you to stand by for us. We wish your family safety and they're able to get through the evening without any problems. Stand by first. We'll continue to check in throughout the hour-Wolf.

BLITZER: We certainly will, Isha. My heart goes out to Ben and his family, indeed all the people of Egypt right now. We're standing by to speak live with Egypt's ambassador to the United States, Sameh Shoukry (ph). He's going to be here. We'll discuss what's going on and the report he's getting from his government. Ambassador Shoukry (ph) will be here.

Also direct information from people who live in Egypt. It has been slow in coming but tonight we're starting to get Tweets, Facebook posts, e-mail once again. And as Ben just told us they're describing violence, looting and efforts to organize protests. I speak with an Egyptian blogger who is plugged into what's happening from his neighborhood in Cairo. All that, coming up.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

(PROTEST CROWD CHANTING)

BLITZER: Protestors earlier today on the streets of Cairo, Alexandria, Suez, other cities in Egypt, protesting against the Egyptian government of President Hosni Mubarak. Let's bring in CNN's National Security Analyst Peter Bergen, right now. He is the author of the new and best-selling book, "The Longest War". He is an expert on the Middle East. He is with the New America Foundation. He'll be with us throughout our special coverage, tonight.

Where, if at all, does Al Qaeda fit into this entire equation?

PETER BERGEN, NEW AMERICA FOUNDATION: I would say not at all. I mean, we can perhaps expect some kind of statement from Ayman Al Zawahiri, number two in Al Qaeda who is after all, Egyptian, who will opportunistically will want to say something about this. He is somebody who hates Mubarak personally. He spent three years in Mubarak's prison in the early '80s, which probably radicalized him further. So it would be astonishing to me if they didn't try to take advantage of this, at least rhetorically. But their role in what is actually going on in Egypt, historically, going back decades now is zero.

BLITZER: The disappearance of the police on the major cities of Egypt right now, the military is still there, but the police for all practical purposes -- which has been so powerful over the years -- gone. What does that say to you?

BERGEN: Well, the most dangerous time for a regime like this is when the security forces won't shoot. And we saw in 1979 the Romanian revolution, with Ceausescu, initially, they would fire on protesters, but after a point, the security service stopped. If you don't have that in a repressive regime, what do you have?

BLITZER: Do you believe at this point the Mubarak government can survive?

BERGEN: I don't think so.

BLITZER: How much time do you think it has?

BERGEN: I mean, that's very hard to tell. I mean, you know-huh, I- first off let's start with the things we know for certain. Gemal Mubarak, the son, who is poised to become the next president, was the plan. That plan is over. Can Mubarak find some face-saving method to step down, do a sort of Lyndon Johnson, say I am stepping down as Lyndon Johnson did in '68, go into exile in somewhere like Saudi Arabia, where so many dictators have gone in the past.

Obviously, his speech indicated that he doesn't plan to do that. But then he is going to have to deal what happened today. He has to see what the army is saying to him. The fact that he's selected his vice president the guy who was this charge of the internal security services is to me an absolute sign of desperation. This is a guy who is responsible for torturing thousands and thousands of people. And the fact that he's now the number two, that says a lot right there.

BLITZER: He's never had a vice president, ever, Hosni Mubarak. Omar Suleiman now the vice president. We are going to continue this conversation, but there is news developing.

Isha, let's go back to you. What are you getting?

We're just getting this news in to us here at CNN, coming to us via the Reuters News Agency. They are reporting that Egyptian police have shot dead 17 people who were trying to attack two police stations on Saturday in Benisuet Governet (ph), now that is south of Cairo. They're getting that word from witnesses and medical sources.

I want to repeat this is news coming into us via the Reuters News Agency, saying that Egyptian police have shot dead 17 people in two separate instances. I want to bring in Ivan Watson, who is there in Cairo, to get his reaction to this news.

Ivan, we have seen over the days police stations being targeted by these protesters.

IVAN WATSON, CNN INTERNATIONAL CORRESPONDENT: We had these running battles throughout the day here in Cairo between the police and the demonstrators. And the remarkable thing that happened was that today, Saturday, the police really disappeared off the streets of this city, were nowhere to be seen. Instead, you had residents of Cairo posing for photographs in front of the burned-out hulks of police troop carriers, and police stations that had been torched.

However, there was one running battle that was taking place throughout the afternoon at the interior ministry building. There we had youths gathering and approaching throwing rocks and being fired upon by uniformed police ,officers who were still trying to maintain a perimeter. And we did see a stream of wounded young men being brought in to a makeshift first aid clinic, where they were coming in with what appeared to be some type of pellet type wounds. I did see perforations in the stomach of one young man. A lot of them that had bruises, deep bruises like in their hands and ankles and legs.

And we did see one body of a man being carried through the streets wrapped in an Egyptian flag, with the claims that he had been shot dead right outside that interior ministry building. And the very emotional reaction, as you can understand, from one of his friends right beside that grim procession carrying that body. Take a look at this, Isha.

(BEGIN VIDEO CLIP)

WATSON: What happened?

UNIDENTIFIED MALE: Someone killed my friend. Mubarak. Mubarak - at the time of the (UNINTELLIGIBLE) died. Not the crowd, but only an Egyptian crowd.

WATSON: What happened there?

UNIDENTIFIED MALE: After the square -

(END VIDEOTAPE)

(END VIDEO CLIP)

WATSON: Now, Isha, a very interesting thing to observe now is the role that the Egyptian army, the military, is playing amidst some of these running battles between the vestiges of the police force and the demonstrators. You may be able to see some tanks behind me. You may see Egyptian armor rolling through the streets of the Egyptian capital throughout the night conducting patrols. That may be a very reassuring sign for many Egyptians, very concerned about the possible breakdown of law and order now that even though they are much hated police, they were maintaining some semblance of law and order. And now they're gone off the streets.

Eyewitnesses tell me that as the drama and the battle unfolded next to the interior ministry today, the army was hanging back, providing some cover to the demonstrators, not engaging in direct battle, but also playing a kind of mediating role between the police and the demonstrators, Isha.

SESAY: Ivan, you make a very important point to bring out for our viewers, the difference in the relationship between the people of Egypt and the police, versus that relationship with the army. It's a very difficult relationship with the police that have been known to commit acts of torture and abuse of people's rights. Ivan Watson, standing by for us in Cairo.

Wolf.

BLITZER: No doubt, Isha, where the military in the end winds up will be critical in determining the future of Egypt right now.

The State Department, here in Washington, is warning all Americans not to go to Egypt right now. The Secretary of State Hillary Clinton is warning Egypt's government do not use violence on your own people. It's a very delicate diplomatic balance. Our own Candy Crowley will be sitting down, by the way, with the secretary of State, Secretary Clinton, on CNN's "STATE OF THE UNION" tomorrow. Candy will be joining us next.

(COMMERCIAL BREAK)

BLITZER: They're working overtime at the White House, President Obama, and political leaders, indeed, around the world are carefully watching all the developments in Egypt. It's a critical partner in the Middle East, a major recipient of U.S. aid as well.

Candy Crowley is our chief political correspondent, the host of CNN's "STATE OF THE UNION." She is here to walk us through what the Obama administration needs to do.

We know what they want. They want to see a democratic peaceful pro- Western regime emerge, but how they get there is anyone's guess.

CANDY CROWLEY, CNN ANCHOR, "STATE OF THE UNION": Exactly. And look, for 30 years they've been dealing with Hosni Mubarak throughout however many administrations. And the fact of the matter is you deal with who you got and they have dealt with him over the years.

Every year or so, the president comes out, gives a speech, a U.S. President says, OK, listen, you've got to open up the political process and there has to be democracy. And some -- there are sort of changes around the edges, but nothing really happens. Now something has to happen. This is delicate for the U.S. Hosni Mubarak, it's not just that Egypt is a great ally. He's been helpful in pushing back Iran on nuclear weapons. He has been helpful in the war on terror. He has been helpful in that there has been a cold peace with Israel for 30 years with Egypt. He's a conduit to other Arab nations not as friendly. So that's big.

On the other hand, the U.S. does believe in democracy. So they -- I think what they're doing now, diplomatically, is the president's speech stands. They are giving that time to simmer. He made it very clear I don't want you to send your armies out to attack these protesters that are peaceful. And there has to be more than words. It has to be more than a shuffling of the cabinet. So they want to see action-particularly on jobs.

BLITZER: There are elections scheduled for the fall in Egypt. The U.S. would love to see free and fair elections, although some officials said to me, you know what, we're not sure who would emerge the winner in those elections, given the current environment in Egypt.

CROWLEY: We've seen that happen. We've seen that happen when we encouraged elections in Gaza and got perhaps people we didn't particularly want. So, yes, they don't know what would happen, but I don't think at this point they're looking that far. Right now, I think they feel it is somewhat under control.

On the other hand, it -- as we just heard the report you just talked about, the minute it becomes even bigger on the streets, I think you'll see the U.S. ratchet up the pressure on Mubarak. They don't want him to leave at this point, obviously. They would like him to find a way to reach out to these protesters, and so far obviously haven't seen that.

BLITZER: And to transition to someone else. Candy has a big interview tomorrow morning on the "STATE OF THE UNION" with the Secretary of State Hillary Clinton. We'll all of course be watching. She also has John McCain joining you as well as Chuck Schumer.

Is that right?

CROWLEY: Right, right.

BLITZER: Excellent "STATE OF THE UNION" 9:00 a.m. Eastern, here on CNN.

Isha.

SESAY: Well, Wolf, in the Cairo suburbs tonight, people are defending their homes with bats and kitchen knives. We'll take you there live in just a moment. Stay with us.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Mubarak, get out of Egypt! We don't need you. We don't -- we don't want you here in Egypt. Get out!

UNIDENTIFIED MALE: No Mubarak! No Mubarak!

(END VIDEO CLIP)

(COMMERCIAL BREAK)

ISHA SESAY, CNN ANCHOR: I want to welcome viewers here in the United States and right around the world. We continue to closely follow the events in Egypt where Egyptian President Hosni Mubarak is facing the greatest threat ever to his 30-year regime and struggling to maintain his hold on the government and regain control of the country.

Here's the status right now of this fast moving highly volatile situation. Tens of thousands of anti-government protesters again swarmed into the streets of Cairo and other cities demanding that Mubarak step down. Mubarak's key government official resigned today. He named his intelligence chief as his first ever vice president.

Now Reuters news agency is reporting that police today shot and killed 17 protesters trying to attack two police stations south of Cairo. Dozens of people were wounded. Dozens of others have been killed since these protests erupted earlier this week, but at this point there is no precise number of the dead.

Well, the army has taken up positions in the streets acting on orders from Mubarak. But so far as we watch these events, the military hasn't cracked down on protesters. In many areas, the police have abandoned their positions. Eyewitnesses are now reporting that in some Cairo neighborhoods residents armed with sticks, kitchen knives, other weapons they've been able to get their hands on are trying to protect homes and businesses from looters.

Well, despite the efforts of these vigilantes, looters managed to bust into Cairo's museum of antiquities. There were reports some exhibits were damaged, but now we're hearing from Egyptian television nothing was stolen.

It's 1:30 in the morning in Cairo and for the moment it is quiet on most streets. The airport however remains a hub of activity. Our very own Arwa Damon is among those trying to get into the country while others are trying to get out. Arwa, describe for viewers the scene at the airport right now.

ARWA DAMON, CNN CORRESPONDENT (via telephone): Hi, Isha, fairly chaotic. You have hundreds of passengers who are basically stranded, many of them curled up on the floors in sleeping bags, others wandering around trying to make phone calls, trying to figure out where they can either spend the night or when the next flight out is going to be.

Many are part of tour groups and their tour guides are telling them that it's not safe to leave, basically forcing them to stay inside. It's a very difficult situation, though, because basically there's no water left at the airport, very little to drink, very little to eat as well. People are trying to really get by with anything that they can.

We met an older couple from the United States. They had had a magnificent vacation in Egypt for a week and then came back to Cairo only to be stuck for a second night in a row. We also met a group from London. One was a party organizer and they had come over, expecting to be part of a party.

They had with them singers, flame throwers, a magician as well who were entertaining people at the airport. They're also stranded here trying to figure out how to get out. People are looking for answers, but there really are very few available at this point, Isha.

SESAY: Arwa, what is the situation regarding flights at the airport for those trying to get out? Update us on that.

DAMON: There flights that are still coming in and out, but they're fairly overbooked and there are also flights that have been delayed. You know, one couple we spoke to was trying to get to another country in Africa. Their flight has been delayed. They weren't exactly sure when they would be able to get on the next one.

This British group we ran into, they had heard there were going to be additional flights coming in from the U.K. They heard that the flights were then turned around. British Airways they're saying is only running one flight. They're not entirely sure when they'll be able to get out.

One flight coming in was delayed an hour and a half. People were talking about massive delays too in getting their luggage. One couple spoke about having to wait five hours to get their luggage. They then missed their connecting flight. People are really just camping out, hunkering down, hoping it ends sooner rather than later but it's becoming increasingly difficult.

Everyone is obviously naturally very tired. As the situation grows more uncertain they're growing more anxious. As we were leaving the airport we managed to get a ride out with a young driver very, very nervous.

In fact, he was so agitated that he missed the turn at a hotel. We ended up at an army checkpoint where they were incredibly tense as well. They made us get out of the vehicle and searched us and they searched through all of our luggage. Once again I think the one word to describe the situation right now is incredibly tense.

SESAY: Probably tense and chaotic. Arwa Damon joining us there from the airport there in Egypt and painting a picture of chaos, people camping down and just waiting to see when they can get out of the country or at least get out of the airport. Wolf, back to you.

WOLF BLITZER, CNN ANCHOR: What a tense situation at the airport. Thank you, Isha.

Joining us is Sameh Shoukry, he's the Egyptian ambassador to the United States. Mr. Ambassador, welcome here to CNN. I know this has been an incredibly tense period for you and for all of Egypt.

I have a lot of questions for you, but I want to bring in our senior white house correspondent Ed Henry for an update first on what the Obama administration is doing about all of this, dramatic developments today. Ed, update our viewers on what the U.S. is up to. ED HENRY, CNN SENIOR WHITE HOUSE CORRESPONDENT: Well, Wolf, you're right. It's been another intense day here at the White House as top officials try to monitor the situation. It started very early this morning when Tom Donnelly and the president's national security adviser convened what they call a principals meeting.

Essentially cabinet secretaries and other top officials from the CIA Director Leon Pineta to Admiral Mike Mullen, the chairman of the Joint Chief is coming over from the Pentagon. Vice President Biden, Secretary Of State Hillary Clinton joining both of them by secure teleconference as well as the Treasury Department official.

Interesting, it shows how it touches international finance in addition to defense, intelligence. The implications are just enormous then at about 1:00 p.m. Eastern Time, the president himself convened a second meeting here at the White House. Again, a lot of top officials including his new chief of staff Bill Daley.

We're told during that meeting, the president was firm with his staff saying he wanted to send a message once again to the Egyptian government as he did last night in that direct phone call to President Mubarak that in the words of a White House aide he reiterated the focus on opposing violence and calling for restraint supporting universal rights and concrete steps that advance political reform within Egypt.

We will hear that same message again tomorrow when Secretary Of State Hillary Clinton takes the extraordinary step of appearing as you've been noting on all five Sunday talk shows here in the United States. She will again repeat the message that the U.S. was disappointed with what President Mubarak had to say last night.

They've also threatened here that U.S. aide to Egypt including $1.3 billion a year in military aid could be on the line. But as you know this White House is acutely aware that they can't push the Mubarak government too hard because they don't know if his government were to fall -- and that's a big if -- who would fill that power vacuum when you have other U.S. allies like Israel right in the neighborhood. The stakes for this administration obviously are just enormous, Wolf.

BLITZER: Ed Henry at the White House. Ed, stand by. The Egyptian ambassador to the United States, Ambassador Shoukry is here with us. Are you in touch with the U.S. government? Do you meet with U.S. officials during this crisis?

SAMEH SHOUKRY, EGYPTIAN AMBASSADOR TO U.S.: Absolutely. Had very minute by minute conversations yesterday with members of the administration. There have been messages going back and forth and we've trying to coordinate and cooperate as much as possible.

BLITZER: What about today?

SHOUKRY: Today there has lack of communication.

BLITZER: Lack of communication? Why is that?

SHOUKRY: I have not received any direct communication and I have no instructions to conduct any.

BLITZER: Is there a government in Cairo that is giving you instructions?

SHOUKRY: Certainly the Ministry Of Foreign Affairs and other government institutions are in place and do communicate with us.

BLITZER: But they haven't given you new instructions today?

SHOUKRY: There have not been any new instructions or communications --

BLITZER: Is there a foreign minister?

SHOUKRY: The foreign minister is attending the African Union Summit and he will be returning to Cairo.

BLITZER: He better get back soon. It seems like you have a crisis in Egypt right now. Not necessarily a good place for him to be there right now.

SHOUKRY: We are in the process of forming a new government in any case and we expect that hopefully within the coming day or two the new government will be in place.

BLITZER: An extraordinary statement came out from the leaders of Britain, France and Germany today. David Cameron, Nicolas Sarkozy, Angela Merkel, among other things they say this, the Egyptian people have legitimate grievances and a longing for a just and better future. We urge President Mubarak to embark on a process of transformation, which should be reflected in a broad-based government and in free and fair elections. You want to react to that.

SHOUKRY: Well, I think it's very apparent that the demonstrations that Cairo has seen and other parts of Egypt have indicated that the Egyptian people -- they are most concerned with their well-being and they are the owners of their future.

They will continue to strive to -- for their economic and social and political development. They have aspirations. They have taken advantage of developmental programs in the past and I'm certain that greater expediency and greater speed of instilling reforms is one of the major calls.

BLITZER: I want to take a quick break, but I want to continue this conversation. Do I hear you saying that President Mubarak is ready for a peaceful transformation to someone else?

SHOUKRY: I am speaking about reform, which is, I think, quite apparent in president's statement yesterday where he accepted the need for greater reforms, speedier reforms and has indicated that the direction of the new government will be one that will concentrate on effecting reforms that impact in a positive manner the Egyptian people.

BLITZER: Stand by for a moment, Ambassador. We'll continue our conversation and also go to Alexandria, Egypt, where protesters are very angry at President Mubarak and yelling their frustration at CNN's cameras.

(COMMERCIAL BREAK)

SESAY: We have breaking news just coming in to us here at CNN coming to us out of Egypt. It is now being reported by Egyptian state-run television Nile TV that close to 1,000 prisoners have escaped from a prison about an hour outside of Cairo.

It is our understanding from the reporting that is now going out that these prisoners are now on the road heading to Cairo and that they're on the streets causing chaos and anxiety. Families are scared. We have been telling you throughout this hour that neighborhoods in Cairo and around Egypt have had to form vigilante groups to protect from groups looking to loot and basically cause trouble.

Now we're getting this word coming in from Nile TV, Egyptian state-run television that close to 1,000 prisoners have escaped from a prison about an hour outside of Cairo. Wolf, an extremely troubling development.

BLITZER: Very troubling. Shocking, Isha. Let's ask the ambassador of Egypt to the United States. How is that possible? How does that happen 1,000 prisoners escape from a prison outside of Cairo and are now running amuck?

SHOUKRY: Certainly disturbing news. It's a demonstration of degree of chaos and lack of security that has emanated from these events.

BLITZER: What happened to the police?

SHOURKY: It is unclear to what extent the police forces are still undertaking their responsibilities but at the same time, I think we have to mention I personally and I think many Egyptians are very confident in the abilities of the armed forces who have taken to the street.

BLITZER: Those are military, but you differentiate them from the police?

SHOUKRY: Definitely.

BLITZER: The police appear to have disappeared according to eyewitness reports.

SHOUKRY: From the news reports that I'm monitoring there is a lack of police presence, but at the same time there is a high degree of confidence in the ability of the military, the armed forces who have been in the streets and received very affectionately by the people who are there to protect the demonstrators and protect the public and private property and I'm sure that they will be able to handle the situation.

BLITZER: You may be more optimistic than me. These are live pictures. We can see it's relatively quiet as we approach 2:00 a.m. in Cairo. Live pictures from our Cairo bureau. I'm sure you have been in touch. You have loved ones and family members in Cairo and elsewhere. What are they saying to you?

SHOUKRY: There is of course a sense of crisis. They are all concerned about their country. They are all loyal and loving of Egypt and want to see Egypt in the best possible light. And of course there is the security we've mentioned but people have taken the responsibility among themselves among them my younger son who joined a neighborhood watch protecting private property.

BLITZER: What is he saying?

SHOUKRY: He is saying there is a great deal of solidarity among their neighbors?

BLITZER: They're afraid of what?

SHOUKRY: There have been reports of hooligans and attacks on private property and they are banding together to protect each other.

BLITZER: But they don't have guns. Maybe they have some knives --

SHOUKRY: I think they're resorting to their numbers. They're resorting to their ingenuity and their ability to fend off any attacks. Most of the attacks have been sporadic, have been isolated and perpetrated by some hooligan, some criminals. And when they see resistance, they have tended to not face the confrontation.

BLITZER: A lot of us are shocked by what we're seeing, especially those of us who have been to Egypt on many occasions. You lived there your whole life, are you stunned by what happened so quickly.

SHOUKRY: It is a development, but Egypt is important to the world. It's important it rests in the strength of its population and resourcefulness and their ability to overcome difficulties.

BLITZER: President Mubarak has been in power for 30 years. He's never allowed a vice president to emerge. But today he names Omar Suleiman, a man you know, as the new vice president. What does that mean now that he has finally decided at age 82 to allow Egypt to have a vice president?

SHOUKRY: The demonstrators I think had indicated their concern related to the future. And this comes as one of the many steps that I'm sure will be taken to reassure the public in terms of the ability to -- Egypt's institutions to continue to operate and continue to provide the -- by the government and the personnel who lead it, the leadership and the capability to fulfill the aspirations of the people.

BLITZER: We showed our viewers some pictures of him being sworn in by the president. Can we assume in advance of elections if something were to happen to President Mubarak, if he decided to step down or flee or whatever, that Omar Suleiman would then emerge as the next president of Egypt? SHOUKRY: Constitutionally if the president is incapacitated or leaves office, the presidency in a temporary manner is transferred to the speaker of parliament, who is under obligation by law to conduct elections within 60 days to elect a new president.

BLITZER: So what would be the role of Omar Suleiman, the new vice president?

SHOUKRY: That is the constitution. Of course, Mr. Suleiman's position as vice president leads him to take an active role in continuing to be active on the political scene and to continue to be contact point and a coordinator of government activity.

BLITZER: He's been the head for many years of all of Egypt's intelligence services, the security services. He's well known to U.S. officials at Washington, the Pentagon, the National Security Council, the CIA, well known to the Israelis and many others in the Arab world as well. Tell us about this man.

SHOUKRY: Certainly before that, he has a prominent military career. He is well-respected by Egyptians for his credibility and personal integrity and as you mentioned, his long association with the internal and external dimensions of politics --

BLITZER: You think he would be more acceptable to the people who are demonstrating on the street than President Mubarak is?

SHOUKRY: Well, like I say, I think he is held in high regard. He has a lot of personal credibility and capabilities. And I'm sure he's recognized for that in many quarter, he is held in high esteem.

BLITZER: This new government that President Mubarak has, almost all of them are deeply rooted former military generals. A lot of experts have suggested the Egyptian military -- will they stay loyal to Mubarak or move to the people on the streets? What's your assessment?

SHOUKRY: The Egyptian military has always been the safety for Egypt. It protects its citizens. It protects its borders and it is held in high regard and esteem. It is a professional force that has always demonstrated its ability in a time of crisis to create stability and provide the welfare for the Egyptian people.

BLITZER: If Mubarak loses control of the military, it's over for him?

SHOUKRY: The military is an important aspect of Egypt and Egyptian politics and it is necessary, of course, of such an important institution to have a role in the formulation of Egypt.

BLITZER: We'll stay in very close touch with you, Mr. Ambassador. We want to wish to all the people of Egypt only the best. This is a real crisis that's unfolding and lives are at stake as we all know. We wish your family, obviously, safety in Egypt as well. Thank you for coming in.

SHOUKRY: Thank you.

BLITZER: Aisha, back to you.

SESAY: The chants grow lode louder each day -- get out, Mubarak, is just part of what they're saying.

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BLITZER: As demonstrations push forward in Egypt, police response seems to have waned.

SESAY: Security forces in Cairo dwindled on Saturday. Protesters were out in large numbers promising to defy a night time curfew.

BLITZER: But excitement in some places was tempered by injury, death and sadness elsewhere. CNN's Ivan Watson reports.

(BEGIN VIDEOTAPE)

IVAN WATSON, CNN CORRESPONDENT: The crowds have gathered here, still chanting, a lot of elation. But the curfew is coming fast. So we're trying to ask people what are they going to do when they're told to go indoors? Madam, are you going to go inside when the curfew starts?

UNIDENTIFIED FEMALE: No, I will not go inside, over my dead body. They will kill me, no problem.

WATSON: You're going to stay out protesting?

UNIDENTIFIED FEMALE: Yes, we will stay here.

WATSON: It's hard to put into words the scenes of elation that we're seeing here with people hanging on the military's tanks, riding through town.

One man said as a result of today, I feel proud to be an Egyptian for the very first time. Chanting "discount with the regime." But there has been violence amid this carnival atmosphere. We've seen a number of people wounded, being treated by doctors on the dirty floor outside a mosque. What happened?

UNIDENTIFIED MALE: Someone killed my -- it was an officer.

WATSON: We're very excited right now and pretty upset because there's been some shooting going on. The doctor telling us five dead people have been brought into the entrance of this mosque and there's one being treated right now with a bullet wound. This has been a day of liberation for some, but it's also been a day of violence.

And the doctors here at this mosque have been treating people coming in with wounds throughout the afternoon. We've heard about a number of gunshots. You can see this young man being treated right here with some kind of wounds to his chest and arms.

The name of this square where this sea of chanting humanity has come to is called Tarri Square. That means liberation and the people here are celebrating a kind of freedom that many of them say they've never felt before. (END VIDEOTAPE)

BLITZER: What a story. Isha and I are back in one hour. Don Lemon straight ahead in the CNN NEWSROOM.

SESAY: For our international viewers, please stay tuned for "World Report."

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