President Abdel Fattah al-Sisi said Egypt will never return to the corrupt ways of the past, after a court dismissed murder charges against former leader Hosni Mubarak.

"The new Egypt, which emerged from the January 25 (2011) and June 30 (2003) revolutions, is on a path to establish a modern democratic state based on justice, freedom, equality and a renunciation of corruption," he said in a statement late Sunday.

An Egyptian court on Sunday branded the Islamic State jihadist group operating in Iraq and Syria a "terrorist" organisation, the official news agency MENA reported.

An Egyptian militant group, Ansar Beit al-Maqdis, which pledged allegiance to IS earlier in November, has itself also been designated a terrorist organisation under a similar ruling.

Critics on Sunday accused Egypt's courts of taking sides after the dropping of a murder charge against ex-president Hosni Mubarak, with experts and activists saying the country's hopes for democracy were being dashed.

A Cairo court on Saturday dismissed the charge against 86-year-old Mubarak over the deaths of protesters during Egypt's 2011 Arab Spring uprising.

Egypt's jailed ex-president Hosni Mubarak could be released early after serving two-thirds of a corruption sentence and seeing murder charges dropped, his lawyer said on Sunday.

An Egyptian court on Saturday dismissed the murder charge against Mubarak over the deaths of protesters during the country's 2011 uprising.

One person was killed in clashes between Egyptian police and protesters in central Cairo on Saturday after a court dropped a murder case against ousted strongman Hosni Mubarak, officials said.

More than 1,000 protesters had converged on Tahrir Square in Cairo after the verdict earlier in the day. Police initially fired tear gas and water cannon to disperse them.

Hosni Mubarak, who on Saturday escaped murder charges, ruled Egypt with an iron grip for three decades until he was forced from power by the 2011 democratic uprisings that swept the region.

The 86-year-old's spectacular fall from grace sent shock waves across the Middle East and beyond when he announced his resignation on February 11, 2011 after an 18-day popular revolt.

Already struggling under the weight of an Israeli blockade, Gazans are now feeling the effects of an Egyptian exclusion zone along their shared border that has sent prices soaring.

Two people were killed Friday as Islamist protesters and police clashed in Cairo just hours after unidentified attackers shot dead two soldiers, including a senior officer, in the Egyptian capital.

The army and police had fanned out across Cairo and other cities in anticipation of rallies called by an Islamist group that opposes the military's overthrow of president Mohamed Morsi last year.

France on Wednesday urged Egypt to continue its path towards democracy, as visiting president Abdel Fattah al-Sisi sought to restore his country's reputation with his first European tour after a deadly crackdown on opponents.

"We want the process to continue, a process of democratic transition which respects the roadmap and allows Egypt to succeed fully," said French President Francois Hollande at a joint news conference after talks with Sisi.

An Egyptian court sentenced 78 teenage boys to between two and five years in prison Wednesday for joining protests demanding the return of the ousted Islamist president, judicial sources said.

The authorities have engaged in a crackdown on Mohamed Morsi's supporters since the army deposed him last year, with hundreds jailed in mass trials the United Nations has described as "unprecedented in recent history".