House gives initial nod to amendments to nationality law that could drum up more FX: MPs yesterday gave its preliminary approval to amendments to the nationality law that will make it easier for foreigners to become Egyptian citizens.

The amendments could help attract much-needed hard currency: The changes would allow foreigners to gain citizenship by purchasing real estate, investing directly in local projects, or depositing money with the central bank. An ongoing shortage of foreign currency has stymied imports to Egypt and helped fuel inflation.

How it works: Foreigners will be able to become green passport holders if they:

  • Purchase assets worth no less than USD 300k using USD from abroad;
  • Establish a solo or joint investment project with a USD 350k investment in addition to depositing USD 100k into the state treasury;
  • Make a refundable USD 500k deposit to an Egyptian bank or a non-refundable USD 250k deposit into the state treasury.

Not everyone is onboard: Some opposition MPs voiced their reservations, saying foreigners who invest in the country should be granted permanent residency at most. Maha Abdel Nasser, speaking on behalf of the Egyptian Socialist Democratic Party, said the policy would “be just ink on paper and will end up failing, like the expat car-import-for-FX law, which generated very modest FX revenues.”

REMEMBER- The expat car import scheme has brought in just USD 385 mn since its launch in November, nowhere near the Finance Ministry’s ambitious USD 2.5 bn target.

But developers are optimistic: Real estate developers and other stakeholders Enterprise spoke with said the legislative changes could spur a boom in foreigners purchasing real estate and land assets in Egypt, helping the sector recoup some of its recent losses amid volatile economic conditions.

AND- Correcting a gender bias: The amendments to the nationality law would also allow all Egypt-born children of foreigners from Arab or Muslim countries who were also born in Egypt to apply for citizenship, a privilege that is currently only available to the children of men from those countries.

What’s next: The amendments will be up for a final vote in the House before being signed into law by President Abdel Fattah El Sisi.

Also approved by the House:

  • A USD 64 mn loan from South Korea’s Export-Import Bank (KEXIM) for 32 underground trains for Cairo metro lines 3 and 4;
  • A JPY 41 bn (c. USD 310 mn) loan from the Japanese International Corporation Agency (JICA) to finance the first phase of Cairo’s fourth metro line.
  • A USD 19 mn USAID grant to improve economic governance;
  • A USAID trade and investment grant to boost exports of textiles and clothing to the US through industrial zones.

The House is now on Eid break: MPs will reconvene on Sunday, 30 April.

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