On June 29, over 1,000 participants, including a high-level European Union delegation led by Commission President Ursula von der Leyen, descended on Cairo for a two-day EU-Egypt Investment Conference. By all accounts it seems to have been successful. Egypt and the EU reached a €1 billion investment deal, and over 20 memorandums of understanding (MoU), collectively worth approximately €40 billion in private investment, were signed on the sidelines.

The conference carried momentum from an earlier landmark deal, signed in March: the Joint Declaration on the Strategic Comprehensive Partnership, wherein the EU pledged a €7.4 billion aid and investment package to Egypt. The money was hugely welcome relief to the Egyptian state, at the time trying to clamber out of its deepest economic pitfall in decades. But just as advantageous, and of more political interest, was the geopolitical boost this March deal gave to Cairo. The strategic compact included a Macro-Financial Assistance (MFA) agreement that covered over two-thirds of the amount pledged. MFAs are typically signed with states connected to the EU either economically or geographically, including those covered by the European Neighborhood Policy. The MFA packages, most often composed of medium- or long-term loans or grants, are generally intended for countries dealing with balance of payment issues and that are already in an International Monetary Fund (IMF) support program. An MFA wasn’t originally in the cards for Cairo; the EU had apparently wanted to offer programmatic assistance, but Egypt had turned that down, holding out for a deal that would give it financial and political control over the purse strings — something, it seems, the EU wasn’t inclined to agree to.

The fact that Egypt ultimately received an MFA is a sound indicator of how interconnected geopolitical fortunes and political alliances have become.

Once considered the refuge of angry fringe extremists, far-right parties have recently been winning one sweeping electoral victory after another across the continent, deeply unsettling Europe’s formerly complacent leftist and centrist parties. A common theme among populist far-right parties has been illegal immigration from countries of the Global South, arriving to Europe by sea. An earlier memorandum the EU had signed with Tunisia in July 2023, though ostensibly about economics and trade reforms, proved quite effective in curbing illegal migration to Europe by putting the onus of enforcement on the Tunisian authorities. Little mention has been made of migration in the new European agreement with Egypt, but there is little doubt that it is a pivotal factor.

Immigrants are hardly a new phenomenon for Egypt, but with at least three active conflicts currently on its borders and no refugee camps on its territory, the numbers are becoming more difficult to deal with for a country struggling with its own stressed economy. In recent weeks, President Abdel Fattah el-Sisi has repeatedly made comments about “guests” in Egypt, which has no refugee camps. The International Organization for Migration (IOM) estimates just over 9 million migrants live in the country (it should be noted that this figure includes foreigners working or studying legally in Egypt, as well as refugees). The figures have shot up since the start of the conflict in Sudan: According to the local Egyptian office of the United Nations High Commissioner for Refugees (UNHCR), since the start of the outbreak of war in Sudan, the numbers of those with refugee status residing in Egypt has climbed from around 290,000 to 675,000 individuals from 62 nationalities, of which Sudanese make up the bulk.

Given the burgeoning migrant numbers, the new agreement with the EU appears to have been the impetus for Egypt’s immigration authorities to sudden reverse policy course. To date, life had not been particularly restrictive for immigrants in Egypt, but a new government decree — 3326/2023 — may be about to change matters. Last November, all undocumented migrants or those whose residencies had expired were required to apply to “legalize their status” by June 30. They will also now be required to have an Egyptian “host” or sponsor. It remains to be seen how similar this arrangement will be to the kafala system, which has proven itself open to significant abuse in the Gulf. In the Egyptian case, the new documentation requires a minimum fee of $1,000 (over €900).

The deadline has been extended four times. According to the news outlet Mada Masr, “[A]mid reports of ongoing arrest and deportation campaigns, undocumented migrants of various nationalities are increasingly concerned that they will no longer be able to live or move freely in Egypt.”

Decree 3326/2023 does not apply to refugees, who may apply for recognition and assistance directly to the UNHCR. However, the process is lengthy, and people fleeing a war zone rarely have the luxury of gathering all appropriate personal documents.

The new immigration policy will help collect specific data that Egypt had previously not been particularly rigorous about. However, Mada Masr reports, the broader deal between Brussels and Cairo will provide a framework for the EU to press Egypt on how it accrues this data on, and what services it provides to, asylum seekers. There are domestic considerations for Cairo as well: The new rules arrive against a background of growing unease within Egypt about refugees, in light of the population’s spiraling economic hardship. The stakes are high for the government, with the conflicts on its border and its uneasy domestic situation becoming potentially dangerously intertwined. Yet Egypt’s currently favored position with international allies depends on its ability to maintain internal stability. The situation requires delicate and nuanced handling — qualities that have not often been attributed to successive Egyptian governments. That said, those same governments have often shown enormous propensity for survival.


Mirette F. Mabrouk is a Senior Fellow and Director of MEI’s Egypt and Horn of Africa Program.

Photo by DIRK WAEM/BELGA MAG/AFP via Getty Images

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