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LE7 million price tag for Egyptian citizenship
What are the requirements and criteria for Egyptian citizenship, how do they compare with those in other countries and what benefits does an Egyptian passport confer?
 
 
 

Egyptian citizenship now has a price tag. Under a new law passed by Parliament on July 16, foreign nationals who deposit at least LE7 million in a local bank will be granted a five-year residency and the opportunity to apply for citizenship.

The legislation is not unique. Many countries offer residency and a path to attain citizenship as an incentive to wealthy investors in a bid to attract foreign capital. Every year, several thousand people spend an estimated US$2 billion globally to acquire a second or third passport, according to the BBC.

What are the investment requirements and criteria in Egypt, how do they compare with the requirements in other countries and what benefits does Egyptian citizenship confer?

Details of the new law

On July 16, Parliament approved a bill submitted by the government to amend provisions on Law 89/1960 on the entry and residency of foreign nationals in Egypt, and Law 26/1975 on Egyptian citizenship.

Under the new law, foreign nationals who deposit at least LE7 million, or the equivalent in foreign currency, are granted a five-year residency. They must reside in Egypt for five consecutive years, after which they can apply for citizenship. Under Law 26/1975, non-Egyptian residents previously had to live in Egypt for at least ten years before being able to apply for naturalization. The final decision to grant citizenship is made by the Minister of Interior. If the naturalization request is approved, the value of the deposit is transferred to the state treasury.

The legislation sparked backlash in Parliament from lawmakers who used nationalist arguments to criticize it, noting that the amendments essentially put Egyptian citizenship up for sale.

“My fellow representatives are asking me to tell you how disgraceful this is,” Haitham al-Hariri, a member of parliamentary bloc 25-30 Alliance, said during a July 15 parliamentary session. “But I suppose this goes along with the state’s effort to generate income, regardless of the source.”

Parliament Speaker Ali Abdel Aal defended the new law, however. “We value Egyptian citizenship above everything else,” he said. “It is indeed priceless. But this law is drafted in the spirit of reaffirming the seriousness of the citizenship applicants.”

“The citizenship law is based on the French law and other comparative positive laws, and it allows — as every law in the world does — granting citizenship based on long-term residence,” he added. “Parliament did not invent the bill we approved. It followed the footsteps of what every other country in the world does.”

Mohamed al-Sewedy, the president of the pro-state Alliance to Support Egypt coalition, which holds a parliamentary majority, also defended the bill. “This law is critical for investment and enables investors to come here, especially given that Egypt is already attractive for investment,” he said. The withdrawal of citizenship would be possible later on, he added, in the event that the individual granted it violates the conditions of the law.

Meanwhile, lawmaker Mostafa Bakry warned the bill posed a threat to national security, to which MP Kamal Amer, the head of the Defense and National Security Committee, responded by saying that “enlistment in the Armed Forces requires careful screening and this law cannot be used by naturalized individuals to infiltrate the Egyptian military.”

The bill is awaiting final ratification by President Abdel Fattah al-Sisi before it passes into law.

The global residency marketplace

Reasons for seeking residency or citizenship in a foreign country vary based on the applicant’s country of origin, from those seeking investment friendly tax environments, to security considerations, to those who want to ease travel restrictions. In an interview with UAE-based newspaper The National, Armand Arton, the chief executive of Arton Capital, a Canadian advisory group that provides consultancy for immigrant investors, notes that the vast majority of those seeking second nationalities come from regions suffering political and economic instability, or from countries whose passports do not grant freedom of movement.

“The demand in the Middle East is growing faster than any other market because of the political instability that started with the Arab Spring,” Arton said.

How do the criteria for an investment-based residency and path to citizenship under Egypt’s new law compare to similar programs in other countries? The most glaring difference is the price tag. While the amount of LE7 million (approximately 334,000 euros) is comparable to the required investment in other states, in Egypt, the funds are transferred to the state treasury upon the approval of a naturalization request. This means that the foreign applicant surrenders their entire deposit. In contrast, many other countries require an investment in real estate or a financial instrument that the applicant later retains as an asset.

Here are some examples of the required criteria in other countries to obtain what is known as a “golden visa”:

  • Greece grants a five-year renewable residency, including to children under the age of 21, to foreign nationals who purchase real estate worth at least 250,000 euros, without requiring actual residence in the country to maintain it. In addition to securing a European Union (EU) entry visa, it is possible to apply for naturalization after seven years of living in Greece. This is considered the least expensive program in Europe, as the total cost after taxes and fees does not exceed 300,000 euros, making it cheaper than the Egyptian program. The residency process takes approximately 40 days to complete.
  • Cyprus grants lifelong residency to foreigners in exchange for the purchase of one or two properties worth a total of at least 300,000 euros. The residency can be passed on to family members, including spouses, parents, grandparents and children up to 25 years old, and guarantees holders the ability to obtain an EU visa with ease. Every relative who benefits from the residency is required to visit the country at least once every two years. The residency process can take up to two months to complete.
  • Malta, also an EU member state, grants a five-year permanent residency in exchange for the purchase of real estate worth between 270,000 and 320,000 euros or renting a house for 10,000 to 12,000 euros annually, depending on the region; or a five-year investment in 250,000 euros worth of government bonds. The residency can be passed to children up to 26 years old, as well as parents and grandparents. It is possible to apply for Maltese citizenship after a year of actual residency in the country.
  • Portugal grants a two-year renewable residency to foreigners in exchange for purchasing real estate worth at least 500,000 euros, or 350,000 euros in the case of properties that need renovation. Residency holders are required to visit Portugal for at least two weeks every two years. The residency secures an EU visa, and family members are included.
  • Spain grants a two-year renewable residency, which includes family members and an EU visa, with no need for actual residency in the country, in exchange for purchasing real estate worth 500,000 euros. Permanent residency can be obtained after five years of continuous residency in the country, and Spanish citizenship after ten years of actual residency, which opens the door to reside and work in any EU member state.
  • Dominica, a small island nation in the Caribbean, grants citizenship in exchange for a $100,000 donation for a single applicant, or $200,000 for a family, including children up to 30 years of age and parents older than 55 years. As a member of the British Commonwealth, Dominica’s passport allows visa-free entry to 122 countries. The process does not require actual residency in the country and takes two to three months to complete.

The new law also poses the question of what benefits Egyptian citizenship offers. In terms of ease of travel, the Egyptian passport ranks low on the global scale. Arton Capital, the Canadian advisory group, ranks passports based on the freedom of movement they secure for their holders. Spanish, Portuguese and Greek passports are in third place, the Maltese passport fifth, the Cypriot ninth, and the Dominican passport 29th. The Egyptian passport stands far below, ranking 78th among 92 ranked countries.

Egypt also ranks low on the international scale in terms of offering a business friendly environment for wealthy investors. According to the Ease-of-Business Index developed by the World Bank, Spain ranks 28th, Portugal 29th, Cyprus 53rd, Greece 76th, Malta 84th and Dominica 98th. Egypt stands at 128 out of the 190 countries listed in the index.

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Mostafa Mohie 
Rania al-Abd