The new bill to amend the Nationality Law, recently approved by the parliamentary National Defense and Security Committee, which would give investors the right to apply for citizenship after living and investing in Egypt for five years, has triggered sharp divisions between the MPs and the public — with speculation over whether Egypt is completely out of solutions for its economic crisis.
The bill, submitted by the Cabinet last year, left many arguing that this move would encourage investments and can help in recovering Egypt’s financial woes, while others maintain that the country's national security would be at stake.
The bill approved by the National Defense and Security Committee would grant Egyptian nationality to foreigners who deposit $500,000 in foreign currencyin an Egyptian bank.
Moreover, on Wednesday, the Cabinet approved an amendment to the draft legislation concerning residency for foreigners, which allows non-Egyptians holding property in the country to obtain residence permits for $100,00 for a one year residency permit. The original sum was $50,000. Foreigners seeking a five-year residency permit would pay $400,000.
According to a Cabinet statement, the amendment is yet to be presented to Parliament and then ratified by the president.
If the foreign national meets certain conditions set by the Cabinet, the $500,000 bank deposit may not be refundable; however, if his/her application is rejected within five years, the deposit may then be retrieved, the statement added.
The draft law, submitted to the Cabinet by Egyptian economist Sameh Sedqi last year, would amend Presidential Decree No. 89 of 1960 on Entry, Residence and Exit of Foreigners and Law No. 26 of 1975 concerning Egyptian nationality.
“We have millions of investors residing in Egypt, they do not pay fees to the state, and they enjoy all of Egypt’s subsidized services. With this bill, they will be asked to pay a deposit and the inflow of foreign currency will help in reviving Egypt’s economic conditions,” deputy of the National Defense and Security Committee, Yehia el-Kedwany, told Egypt Independent.
Kedwany added that granting citizenship will be in accordance with terms and conditions set forth by the state; however, the conditions are still unspecified.
“It’s a matter of sovereignty and security, so it will be entirely in the hands of the Interior Ministry as to whether the state wants to grant the foreign national citizenship or not,” he said, adding that throughout the entirety of the five-year residency, the foreigner will be under observation and scrutiny.
The deposit is yet to be determined by the Minister of Interior, but the proposed amount in the draft bill is $5,000, Kedwany said.
Head of the Economic Committee MP Ahmed Farghali, however, had concerns about national security if this law is to be applied.
“The government should be looking for more practical ways to attract investors to the country. Let’s first fix the investment climate and get rid of the bureaucracy that plays a major role in pushing investors away,” Farghali said, adding that there is no way to ensure that foreign intelligence agencies do not take advantage of the new law to undermine Egypt’s economy.
“Investors choose places where they will gain money, not spend more money. Why would an investor from Europe be interested in obtaining an Egyptian nationality? What privileges will the country offer, that investors do not have back home?” he asked.
MP Alaa Abdel-Moneim of the 'For the Love of Egypt' bloc also rejected the draft law.
“Other European countries like Portugal and Malta grant their nationalities in return for money and people are interested because then they can benefit from EU membership, but in Egypt it’s not the case,” Abdel-Moneim said.
He added that it would be essential for the government to be transparent with the public about the potential number of applicants they expect, as well as the expected number of expatriates that will be granted citizenship after the bill is implemented.
Cabinet spokesperson Ashraf Sultan told Egypt Independent that the draft bill is still under discussion and the Parliament is still hearing other alternatives and proposals on this matter.
“The explanatory memorandum submitted to the Parliament says that the draft law follows the policy adopted by Egypt in encouraging investments and foreigners who usually stay in Egypt for longer periods of time. It aims to create an atmosphere of trust and stability to reassure investors about their funds and projects,” Sultan added.
MP Moataz Mahmoud, chairman of the Freedom Party, supports the draft law and says that similar procedures are viable in several other countries.
“The process is going to be subject to very strict rules and would only apply to those who prove they can positively impact the economy and have great projects that will enhance Egypt’s investment climate; it’s not going to be given to just anyone,” Mahmoud said.
Major General Kamal Amer, chairman of the National Defense and Security Committee, said the committee finally approved the draft law on Thursday, pointing out that the law is in line with the Egyptian interests, would not affect national security, but rather support the economy.
Amer added in a press statement after the meeting that the aim of the draft law is to establish a new system for the residency of foreigners in Egypt depending on a "residence deposit", especially amid increased requests by foreigners to obtain residence permits in Egypt in light of the international changes taking place in the region.