Business in Jordan
Aired August 2004
The Hashemite Kingdom of Jordan is a young country, yet it is home to some of the world’s oldest cities and civilizations. Jordan is an Arab country uniquely situated at the crossroads of Asia, Africa, and Europe. Jordan has been a key trading post in the Middle East for centuries connecting the east and the west.
Jordan combines a rich culture and heritage with a modern, fast-growing economy. Under the leadership and guidance of His Majesty King Abdullah II, Jordan is positioning itself as the gateway to region.
Jordan has an unwavering commitment to opening its market fully to competition, and vigorously pursues free trade. This is demonstrated by Jordan’s accession to the World Trade Organisation, the WTO, and its Free Trade Agreement with the United States. Political, economic, and social stability have helped Jordan to become more internationally integrated.
A regional leader in democracy and market liberalization, Jordan has truly become a key business destination in the Middle East.
TRADE & INDUSTRY
Trade and Industry: The Jordan-U.S. FTA
Signed on October 24, 2000, the U.S.-Jordan Free Trade Agreement, FTA, will have far-reaching effects. It will eliminate customs duties and commercial barriers to bilateral trade in goods and services originating in the U.S. and Jordan.
The agreement aims at strengthening friendship, economic relations, and cooperation between the two countries. It will help to improve living standards and economic growth, create investment opportunities and employment, and eventually increase the capacity and international competitiveness of goods and services in both countries. The FTA covers trade in goods and services, intellectual property rights, the environment, labor and electronic commerce.
As a result of Jordan joining the WTO in 2000, Jordanian and U.S. firms already have significant access to each other's markets, especially in the service sector. With the FTA, Jordan has provided for further liberalization in several areas in the service sector, hoping to stimulate greater U.S. investment in Jordan.
Jordan has undertaken several commitments concerning the protection of intellectual property rights that will be implemented in transitional periods. The FTA also includes provisions relating to e-commerce, the environment, and labor issues.
The two countries anticipate that any disputes concerning the interpretation or implementation of the FTA will be resolved in good faith and through consultations and cooperation between the respective governments.
FINANCE
The Amman Stock Exchange, with overall growth of 50% in 2003, is a great success story in the Jordanian economy. The outlook for 2004 is also promising. The government plans to continue with the privatization process, giving the market even greater liquidity.
Good governance has played a critical role in moving the Jordanian economy forward. His Majesty King Abdullah II has assembled a government passionate and proactive in developing the nation. The Jordanian financial sector has been able to channel both domestic and foreign resources into investment. Jordan's policymaking and regulatory institutions have encouraged healthy competition and development, maintaining economic stability through effective monetary, fiscal and foreign exchange policies and regulations.
Jordanian and foreign banks authorized to operate in Jordan are subject to the same capital, operational, and supervisory regulations.
IT
Jordan has a young, dynamic population utilizing among the region's most advanced mobile, fixed line and Internet communications infrastructure. Jordanian companies are working with partners in the U.S., Europe and the Far East on e-government issues, and creating private sector business opportunities. Jordan is being chosen by an increasing number of multinational corporations as a regional IT base.
What Jordan lacks in natural resources, it makes up for in its strong leadership, stability, educated technical human resources, an enthusiastic private sector and strong infrastructure. These factors combined give Jordan a competitive edge over other regional IT players. King Abdullah II has is determined to make Jordan a regional IT hub, planning to turn the Jordanian IT sector into a billion-dollar industry.
ENERGY
The mining of natural resources plays a vital role in the Jordanian economy. Jordan is the world’s fourth largest exporter of phosphate rock. Phosphate is a key ingredient in soluble fertilizers, and is also used in soft drinks and toothpaste. In terms of revenue, phosphate is the largest export in the Jordanian economy.
Potash, or white gold as Jordanians call it, is another of the country’s valuable natural resources, found in the mineral-rich Dead Sea. Potash is central, along with phosphate, in the production of soluble fertilizers.
With limited oil reserves, energy has long been a challenge to Jordan. Yet Jordan has managed to successfully expand electricity access to 99.9% of the country, and the electricity sector is now due to be liberalized. The government would like to attract substantial private investor capital to fund a new electricity generating plant, to be owned and operated by the private sector.
TOURISM
Over the past decade, tourism has emerged as one of Jordan's most rapidly growing economic activities. Tourism ranks second in terms of foreign exchange earnings and accounts for 9% of the GDP. An estimated 1.2 million people visited Jordan in the millennium year, attracted by the country's stunning landscape, fascinating cultural heritage, and world-class historic sites.
Petra:
Perhaps one of Jordan’s most stunning and mystical tourist destinations is the red-sand city of Petra. Stories of Petra’s beauty, history, and immense wealth have existed for centuries. Petra has witnessed the Israelite exodus from Egypt, the flourishing trade routes of the Nabataeans, the Roman empire, and the Crusades. It was chosen as the setting for Steven Spielberg’s classic movie ‘Indiana Jones and the Last Crusade.’
Wadi Rum:
To the south of Petra lies the Wadi Rum desert. Take a camel ride into Wadi Rum and you'll find yourself in what Jordanians call a 'Heroic and Biblical Adventure'.
The desert has wonderful sandstone formations. These striking mountains reach high into the sky, and are absolutely breathtaking.
The Dead Sea:
The Dead Sea is one of the most unique places on the planet. At 400 meters below sea level, it is the lowest place on earth. The mineral-rich content of the water continues to give travelers tranquility, health and peace of mind in a landscape like none other.
The Dead Sea region is also an ideal base for touring Jordan. Travel distances are short, with the capital Amman only a 40 minute drive and Petra a mere hour and a half’s drive away. Jordan considers it an important responsibility to maintain the Dead Sea as an historic natural wonder.
