Egypt considers pros, cons of foreign citizenship changes

Some in Egypt welcome proposed changes to citizenship laws for foreigners, saying they will increase investment in the country. Others harbor suspicions of ulterior motives.

al-monitor An Egyptian man shows his passport after voting in a referendum on his country's new constitution at the Egyptian Embassy in Amman, Jordan, Jan. 9, 2014.  Photo by REUTERS/Majed Jaber.

Topics covered

investor, syrian refugees, palestinians in egypt, land ownership, foreign investors, nationality law, citizenship in egypt

Jun 26, 2019

CAIRO — The topic of granting foreigners Egyptian citizenship has long been controversial, and proposed amendments to the Egyptian Nationality Law are no exception.

The recent proposals have stirred up many questions since the Egyptian government submitted them to parliament in April. They received initial approval June 9 of the parliamentary Defense and National Security Committee, which will discuss them further and then submit them to parliament’s general assembly for final voting.

Article 2 of the amendment bill would entitle the prime minister to grant nationality to foreigners who buy real estate owned by the Egyptian state or other public entities; it also establishes an investment project in Egypt in accordance with the investment law or deposits a sum of money in foreign currency in Egyptian banks.

Article 3 stipulates forming a Council of Ministers unit to examine naturalization applications. This unit will comprise security authorities and representatives of the ministries of Foreign Affairs, Interior, Investment and International Cooperation. The same article states foreigners would submit naturalization applications after paying $10,000. The unit would examine applications within three months while considering national security. If the prime minister grants initial approval, an applicant would be granted residence in Egypt for six months to complete the required procedures.

Opinions on the amendments vary among parliament members, political and economic observers, and citizens.

The Egyptian Businessmen's Association (EBA) praised the amendments to the Egyptian Nationality Law, also known as Law No. 26 of 1975.

EBA vice chairman Fathallah Fawzi said in a June 17 press statement the proposed amendments to that law and a bundle of others — most notably the unified Investment Law — will help grow the real estate sector in Egypt and create a more attractive business climate for foreign investors.

But speculation abounds. Some critics see the proposed amendments as a move to pave the way for the US plan for peace between Israelis and Palestinians, dubbed by US President Donald Trump the "deal of the century." That deal is being discussed this week at an economic summit in Bahrain.

Many Egyptians were concerned the US plan will include an offer to establish a place for Palestinians in parts of the Sinai. But US officials denied this, and Yahya al-Kadwani, a member of Egypt's parliamentary Defense and National Security Committee, told Al-Monitor that's not likely to happen.

He noted that in 1959, Egypt ratified an Arab League recommendation exhorting Arab countries not to grant nationality to Palestinians so as not to weaken the Palestinian movement to establish a homeland.

Talaat Khalil, a member of the parliamentary Planning and Budget Committee, said some Egyptians, himself included, also fear amendments to the Egyptian Nationality Law would be used as leverage to get Palestinians to cooperate with the US peace plan by offering them Egyptian citizenship.

He said amendments aren't necessarily even needed, as not having Egyptian nationality is unlikely to prevent foreign investors from establishing projects in Egypt. In a June 11 statement to BBC, Khalil said the current unified Investment Law already gives foreign investors many advantages and opportunities equal to those of Egyptian investors, in addition to almost open-ended residency permits.

Other critics claim the amendments aim to pressure refugees, especially Syrians, to invest more in exchange for citizenship. Reports by the Istanbul-based Arabic Post and Qatari Al-Jazeera news websites, which oppose the Egyptian regime, potentially linked the nationality law amendments to a campaign launched by Samir Sabri, an Egyptian lawyer close to the regime.

On June 9, Sabri filed a complaint asking the government to examine the funds of Syrian refugees to ensure they're not used for money laundering or terrorist financing. The news reports said Sabri's complaint might aim to pressure Syrians in Egypt to invest more in real estate or make greater bank and investment savings to obtain Egyptian citizenship.

Yet, Bahaa al-Ghamri, a political science professor at Suez Canal University, questioned the Arabic Post and Al-Jazeera articles. He told Al-Monitor the Egyptian state has always welcomed Syrian and other Arab refugees fleeing civil wars and security unrest in their country.

“The amendments to the Nationality Law will favor affluent Arab and Syrian refugees. Refugees in Egypt are prohibited from engaging in many business activities such as establishing pharmacies, newspapers and some other types of companies. Once the amendments are effective, many Syrians who wish to invest in these fields will be able to do so and get Egyptian citizenship in return," Ghamri said.

Osama Rushdy, a lawyer specializing in the incorporation of companies and representing many foreign investors, denounced attempts to link the amendments to the "deal of the century" or the Syrian crisis. He argued that the amendments aim to promote the Egyptian investment climate and make investing easier.

“Many refugees in Egypt are unable to invest because of their status as refugees, since they don't have permanent residency. Giving them Egyptian citizenship is the best way to secure permanent residency," Rushdy told Al-Monitor.

“The old and current investment laws don't allow foreign investors to incorporate specific types of companies except in cases of Egyptian partnerships such as those with limited shares, with 49% of the shares held by Egyptians. This [high] percentage of shares could force the foreign investor to accept interventions by one or more unwanted Egyptian partners," he said.

Rushdy added, "It's better for foreign investors to obtain Egyptian citizenship to facilitate investment and business procedures.”

Continue reading this article by registering at no cost and get unlimited access to:
  • Al-Monitor Archives
  • The Week in Review
  • Exclusive Events
  • Invitation-only Briefings

More from  Egypt

Crackdown on Egypt’s front-line health care workers continues
A correspondent in Egypt | Coronavirus | Jul 2, 2020
Cairo marks anniversary of revolution by jailing journalists
A correspondent in Egypt | Press freedom | Jul 2, 2020
Tug of war continues in Nile dam dispute
Mohamed Saied | Water Issues | Jul 2, 2020
Can Arab League push Ethiopia to delay filling of Nile dam?
Ahmed Gomaa | Water Issues | Jul 1, 2020