Egypt is offering its citizens residing abroad the opportunity to settle their military positions by paying a minimum of five thousand dollars, along with a retirement plan in dollars aimed at expatriates. This initiative is part of a series of new measures intended to increase foreign currency inflows. In recent months, state-owned banks have begun selling high-interest dollar-denominated bonds, and a law that came into effect in May allows foreigners to obtain temporary residency by purchasing a property valued at no less than 50 thousand dollars or depositing 50 thousand dollars in a state-owned bank.
These initiatives follow a plan announced in 2022 that grants expatriate Egyptians exemptions from customs fees on car imports paid in hard currency, alongside other measures to attract foreign currency investments in land and industry. Egypt's foreign currency reserves have declined over the past two years following a wave of foreign borrowing, compounded by the shocks from the COVID-19 pandemic and the Ukraine crisis. Data from the Central Bank indicates that remittances from expatriates, the largest source of foreign currency for Egypt, fell sharply from January to March compared to the same period in 2022.
A statement released yesterday by the Financial Regulatory Authority noted that the retirement plan allows Egyptians living abroad to purchase a retirement document starting from 500 dollars that guarantees a dollar pension for a period ranging from ten to fifteen years, starting at age 50. The government will also collect foreign currency by allowing expatriates who have failed to serve in the military to permanently settle their retirement status by paying five thousand dollars or five thousand euros within a one-month deadline that began yesterday.
The Ministry of Foreign Affairs announced today that it has designated a WhatsApp number and an email address to receive inquiries about the initiative. It indicated that the number and email will be monitored around the clock and urged applicants to register promptly. Military service is mandatory for most Egyptian males aged 19 to 30. Many have obtained temporary exemptions for travel due to education, medical treatment, or work but eventually remained abroad. Those who fail to perform military service are not allowed to renew their passports.
The government has requested that those wishing to settle their status make their payment to an account created specifically for this purpose at a state-owned Bank Misr branch in Abu Dhabi, UAE. Men over 30 who have also failed to serve will benefit from settling their military status.
Mamdouh Salem, an Egyptian analyst residing in Berlin, stated that in the past, the government allowed military status settlements for a fee of 3,000 Egyptian pounds (approximately 97 dollars), provided that the delinquents returned to Egypt and appeared before a military authority. However, the value of the Egyptian pound has collapsed in recent years.
In 2018, the number of Egyptians living abroad was 8.9 million compared to 97.1 million residing in Egypt, according to the latest figures from the Central Bank of Egypt. Since then, the number of Egyptians living domestically has increased to 105 million. Official data shows that external debt rose to 165.4 billion dollars by the end of March compared to less than 40 billion dollars in 2015, with the Central Bank indicating that at least 50 billion dollars will need to be repaid in the coming years.
