Egypt aims to raise around 50 billion Egyptian pounds ($2.5 billion) from the government-led four-month initiative, its Finance Minister Mohamed Maait told Asharq Business on Sunday. Last week, the Egyptian Cabinet approved a draft law that enables Egyptians living abroad, who account for around 14 million according to 2021 official figures, to import to Egypt one private car per person free of customs duties and taxes, including the value-added tax (VAT). Under the draft law, expats can invest the value of saved customs duties and taxes in foreign currency in a five-year certificate of deposit (CD), but without earning interest. Later, they will be able to recover the deposit in Egyptian pounds at its price at the end of the period. The exemptions are valid for a four-month period starting on the day the law comes into effect. Speaking on the sidelines of the annual meetings of the International Monetary Fund (IMF) and the World Bank in Washington, Maait said it is expected that more than 500,000 cars will be imported into the country by Egyptian expats under the initiative. The minister added that the duration of the exemption was limited to four months in order not to adversely impact the government's strategy of localising car manufacturing. The initiative has gained special interest among Egyptian expats in the Gulf, who total more than 3.5 million, he added. Customs and tax duties that are currently imposed on vehicles imported into the North African country could exceed more than 3 million pounds, the minister said. Egyptian expats who want to take advantage of the initiative should be above 16 years old and have legal residence abroad. They must also own an overseas bank account that is at least three-month old. Expats' spouses and children are exempted from this requirement, the draft law added. The initiative would only apply to new cars that are manufactured in 2022 or second-hand cars that are no more than three-year old as part of state efforts to protect the environment, according to Minister of Emigration and Expatriate Affairs Soha El-Gindy's TV remarks last week. In case of not importing a car within a year after depositing the money to the finance ministry, the expats will be able to immediately recover the deposit in foreign currency, according to the draft law. Since the outbreak of the Russian war in Ukraine, Egypt has struggled with a drop in foreign currency reserves (NIRs) as foreign investors fled away with their investments in the Egyptian treasury bills. In September, Egypt's NIRs recorded $33.198 billion, down from $40.994 billion in February at the time of the start of the Ukraine crisis.
