Return to: Index of "1996 Country Commercial Guides" ||
Index of "Economic and Business Issues" ||
Electronic Research Collections Index ||
ERC Homepage
Jordan Country Commercial Guide for FY 95-96
Office of the Coordinator for Business Affairs
Record Date: Jun 23, 1995
Country Commercial Guide for FY 95-96
Jordan
This Country Commercial Guide (CCG) presents a comprehensive look at
Jordan's commercial environment through economic, political and market
analyses.
The CCGs were established by recommendation of the Trade Promotion
Coordinating Committee (TPCC), a multi-agency task force, to consolidate
various reporting documents prepared for the U.S. business community.
Country Commercial Guides are prepared annualy at U.S. Embassies through
the combined efforts of several U.S. governement agencies.
TABLE OF CONTENTS
CHAPTER I. EXECUTIVE SUMMARY
CHAPTER II. ECONOMIC TRENDS AND OUTLOOK
CHAPTER III. POLITICAL ENVIRONMENT
CHAPTER IV. MARKETING U.S. PRODUCTS AND SERVICES
CHAPTER V. LEADING SECTORS FOR U.S. EXPORTS AND INVESTMENT
CHAPTER VI. TRADE REGULATIONS AND STANDARDS
CHAPTER VII. INVESTMENT CLIMATE
CHAPTER VIII TRADE AND PROJECT FINANCING
CHAPTER IX. BUSINESS TRAVEL
CHAPTER X. APPENDICES
CHAPTER I. EXECUTIVE SUMMARY
JORDAN IS ONE OF THE MORE PROMISING EMERGING MARKETS IN THE MIDDLE EAST.
AN ANNUAL POPULATION GROWTH RATE OF 3.8 PERCENT SINCE 1990 HAS FUELED AN
INCREASED DEMAND FOR IMPORTS. THE SMALL SIZE OF THE JORDANIAN MARKET
SOMEWHAT LIMITS OPPORTUNITIES FOR AMERICAN BUSINESS, ALTHOUGH CHANGING
POLITICAL CONDITIONS IN THE REGION COULD HELP JORDAN REESTABLISH ITSELF
AS A SUPPLIER OF GOODS AND SERVICES TO THE WEST BANK, IRAQ AND THE GULF.
THE POTENTIAL COMMERCIAL IMPORTANCE OF JORDAN IS REINFORCED BY ITS
STRATEGIC GEOGRAPHIC POSITION AT THE CONFLUENCE OF THREE CONTINENTS.
THE SUCCESS OF THE MIDDLE EAST PEACE PROCESS HAS STIMULATED INCREASED
INTEREST IN THE REGION. FOREIGN BUSINESSES ARE EXPLORING OPPORTUNITIES
FOR GREATER INVESTMENT IN AND TRADE WITH THE REGION. THE PRESIDENT HAS
PROMISED TO FORGIVE APPROXIMATELY 750 MILLION DOLLARS IN JORDANIAN DEBT.
OTHER FOREIGN GOVERNMENTS HAVE PROMISED TO HELP JORDAN ADDRESS ITS
ECONOMIC NEEDS.
THE GOJ HAS SIGNED BILATERAL TRADE AGREEMENTS WITH A LARGE NUMBER OF
ARAB, EUROPEAN AND ASIAN COUNTRIES, GIVING JORDAN-MADE PRODUCTS
FAVORABLE TARIFF TREATMENT. ALTHOUGH U.S. GOVERNMENT EXPORT FINANCING
PROGRAMS HAVE BEEN LIMITED AS COMPARED TO OTHER TRADING PARTNERS, U.S.
PRODUCTS ENJOY A HIGH REPUTATION IN JORDAN FOR THEIR SUPERIOR QUALITY.
THESE FACTORS SHOULD ENCOURAGE AMERICAN BUSINESSES INTERESTED IN SELLING
THEIR PRODUCTS OR INVESTING IN JORDAN.
ON OCTOBER 26, 1994, JORDAN AND ISRAEL SIGNED THE JORDAN-ISRAEL PEACE
TREATY. THE TWO COUNTRIES SUBSEQUENTLY REACHED AGREEMENTS ON TRADE,
JOINT DEVELOPMENT OF THE JORDAN RIFT VALLEY AND THE GULF OF AQABA, CIVIL
AVIATION, NAVIGATION TELECOMMUNICATIONS, AND COOPERATION IN THE AREAS OF
TOURISM, ENERGY, AGRICULTURE, SCIENCE, AND THE ENVIRONMENT. UNDER ITS
PEACE TREATY WITH ISRAEL, JORDAN COMMITTED TO PURGING EXISTING LAWS OF
LANGUAGE PERTAINING TO THE ARAB BOYCOTT OF ISRAEL.
JORDAN WILL HOST THE MIDDLE EAST AND NORTH AFRICA ECONOMIC SUMMIT, ALSO
KNOWN AS THE AMMAN ECONOMIC SUMMIT, IN OCTOBER 1995. THE SUMMIT WILL
BRING TOGETHER SENIOR PUBLIC-SECTOR OFFICIALS AND PRIVATE-SECTOR
EXECUTIVES FROM THE MIDDLE EAST, NORTH AFRICA, NORTH AMERICA, EUROPE AND
ASIA TO EXPLORE INVESTMENT AND BUSINESS OPPORTUNITIES IN JORDAN AND
OTHER COUNTRIES OF THE REGION.
MAJOR BUSINESS OPPORTUNITIES
THE AGRO-CHEMICAL, ENVIRONMENTAL, COMPUTER AND INFORMATION
TECHNOLOGY, TELECOMMUNICATION AND MEDICAL TECHNOLOGY SECTORS PROVIDE
PROMISING OPPORTUNITIES FOR U.S. EXPORT SALES. MAJOR OPPORTUNITIES FOR
GOVERNMENT-MANAGED PROJECTS EXIST IN THE WATER, INFRASTRUCTURE, AND
ENERGY SECTORS. MARKET OPENINGS FOR U.S. MANUFACTURERS AND SUPPLIERS
CAN ALSO BE FOUND IN INDUSTRIAL FRANCHISING AND LICENSING, TECHNOLOGY-
RELATED AND ENGINEERING CONSULTING SERVICES, AUTOMATION AND ELECTRONICS
PRODUCTS AND COMPUTER PERIPHERALS AND EQUIPMENT.
MAJOR ROADBLOCKS TO DOING BUSINESS
NON-COMPETITIVE PRICES FOR CONSUMER PRODUCTS AND HIGH SEA FREIGHT
CHARGES FROM THE U.S. TO JORDAN ARE AMONG THE MAJOR BARRIERS TO
EXPORTING TO JORDAN. OBSTACLES TO DOING BUSINESS IN JORDAN INCLUDE: A)
WEAK GOVERNMENT ENFORCEMENT OF REGULATIONS TO PROTECT FOREIGN
INTELLECTUAL PROPERTY RIGHTS; B) RESTRICTIONS ON FOREIGN CAPITAL
OWNERSHIP IN LOCAL BUSINESSES AND GENERAL RESTRICTIONS ON FOREIGN
BUSINESS VENTURES; AND C) TIME-CONSUMING AND ARBITRARY CUSTOMS
CLEARANCE PROCEDURES AND LACK OF INTRAMINISTERIAL COORDINATION.
NATURE OF LOCAL AND THIRD COUNTRY COMPETITION
JORDANIAN BUSINESSES OPERATE IN A VERY COMPETITIVE MARKET THAT IS
DELUGED BY PRODUCTS FROM AROUND THE WORLD. GENEROUS AND FLEXIBLE EXPORT
TERMS AND DIRECT SUPPORT TO LOCAL BUSINESS ARE THE MOST COMMON FACTORS
IN ESTABLISHING A SUCCESSFUL PRESENCE IN JORDAN. IMPORTERS BUY MORE
PRODUCTS FROM COUNTRIES WHOSE COMPANIES GIVE THEIR LOCAL SALES STAFF
ACCESS TO TRAINING AND PRODUCT ORIENTATION. THE ESTABLISHMENT OF
INDUSTRIAL AND BUSINESS JOINT VENTURES IS MORE EFFECTIVE IN THE
JORDANIAN MARKET THAN DIRECT EXPORTING.
COUNTRY COMMERCIAL GUIDES (CCGS) ARE AVAILABLE ON THE NATIONAL TRADE
DATA BANK ON CD-ROM OR THROUGH THE INTERNET. PLEASE CONTACT STAT-USA AT
1-800-STAT-USA FOR MORE INFORMATION. TO LOCATE COUNTRY COMMERCIAL
GUIDES VIA THE INTERNET, PLEASE USE THE FOLLOWING WORLD WIDE WEB
ADDRESS: WWW.STAT-USA.GOV. CCGS CAN ALSO BE ORDERED IN HARD COPY OR ON
DISKETTE FROM THE NATIONAL TECHNICAL INFORMATION SERVICE (NTIS) AT 1-
800-553-NTIS.
CHAPTER II. ECONOMIC TRENDS AND OUTLOOK
MAJOR TRENDS AND OUTLOOK
JORDAN ACHIEVED A 5.7 PERCENT GROWTH RATE IN GDP IN 1994. WHILE JORDAN
STILL SUFFERS FROM A SIGNIFICANT DEBT BURDEN, IT HAS MET OR SURPASSED
MOST STRUCTURAL ADJUSTMENT TARGETS SET BY THE INTERNATIONAL MONETARY
FUND (IMF), AND ITS CURRENCY, THE JORDANIAN DINAR, HAS BEEN STABLE SINCE
1989. JORDAN'S ECONOMY IS, AND HAS ALWAYS BEEN, DEPENDENT ON INPUTS OF
OUTSIDE CAPITAL, WHETHER FROM FOREIGN ASSISTANCE OR REMITTANCES FROM
JORDANIANS WORKING ABROAD.
JORDAN'S OUTLOOK FOR THE FUTURE IS POSITIVE. THE SIGNING OF THE PEACE
TREATY BETWEEN JORDAN AND ISRAEL COUPLED WITH ITS SKILLED, LOW-COST
LABOR FORCE ESTABLISHES THE KINGDOM AS A STABLE AND ATTRACTIVE REGIONAL
SALES/MARKETING AND SERVICE CENTER. THE GOVERNMENT IS COMMITTED TO
IMPROVING ITS INFRASTRUCTURE IN ORDER TO SUPPORT NEW INVESTMENT AND
CONTINUED ECONOMIC GROWTH. IN ADDITION, IT IS TAKING STEPS TO
LIBERALIZE THE TRADE AND INVESTMENT CLIMATE. PREPARING FOR THE FUTURE,
JORDAN IS IN THE PROCESS OF REFORMING ITS INVESTMENT AND CUSTOMS LAWS IN
AN EFFORT TO ATTRACT FOREIGN INVESTMENT. THE JORDANIAN PARLIAMENT WILL
CONSIDER NEW LAWS ON INVESTMENT, INCOME AND SALES TAXES, COMPANIES
REGISTRATION AND THE AMMAN FINANCIAL MARKET IN 1995. FOREIGN INVESTORS
ARE NOW ALLOWED TO INVEST IN JORDAN'S STOCK MARKET. A GRADUAL WARMING OF
RELATIONSHIPS WITH ARAB GULF STATES, ESTRANGED BY THE GULF WAR, OR AN
IMPROVEMENT IN THE POLITICAL SITUATION IN IRAQ WILL FURTHER OPEN UP
TRADE OPPORTUNITIES FOR JORDAN.
PRINCIPAL GROWTH SECTORS
SECTORS WHICH ARE EXPERIENCING SIGNIFICANT GROWTH INCLUDE THE
ENVIRONMENTAL, COMPUTER AND INFORMATION-TECHNOLOGY, AND LIGHT
MANUFACTURING, PARTICULARLY TEXTILES, PHARMACEUTICALS, FOOD PROCESSING
AND TOURISM.
JORDAN IS EMBARKING ON EXPANSIONS OF ITS PHOSPHATE AND POTASH WORKS, THE
TWO LARGEST HARD CURRENCY EARNERS FOR THE KINGDOM. JOINT VENTURE
AGREEMENTS WERE SIGNED RECENTLY WITH INDIAN AND JAPANESE FIRMS FOR THE
PRODUCTION OF FERTILIZERS. THESE NEW PROJECTS WILL LEAD TO SIGNIFICANT
EXPANSION IN DOWNSTREAM INDUSTRIES.
THE ENVIRONMENT HAS BECOME MORE OF AN ISSUE IN THE PAST FEW YEARS
CREATING OPPORTUNITIES FOR RELATED INDUSTRY AND PRODUCTS. THE
GOVERNMENT AND PRIVATE SECTORS ARE BOTH INTERESTED IN REDUCING ENERGY
AND WATER USAGE AND IN REDUCING AND TREATING WASTES HARMFUL TO THE
ENVIRONMENT.
THE COMPUTER AND INFORMATION-TECHNOLOGY FIELD IS ALSO EXPERIENCING RAPID
GROWTH. COMPUTER SOFTWARE DEVELOPMENT, DATA NETWORKS AND VOICE MAIL
SERVICES ARE EXPANDING WITH A GROWING CADRE OF EXPERIENCED SOFTWARE
ENGINEERS. A NUMBER OF THE MOST COMPETITIVE FIRMS HAVE U.S.-TRAINED
ENGINEERS OR ARE COOPERATING WITH U.S. COMPANIES ON SPECIFIC PROJECTS.
IN LIGHT MANUFACTURING, TEXTILES AND GARMENTS HAVE EXPERIENCED THE
FASTEST GROWTH OF ANY SECTOR. SEVERAL FIRMS REGULARLY EXPORT FINISHED
GOODS TO THE U.S. PHARMACEUTICALS ARE A SECOND AREA OF GROWTH, WITH
RIGOROUS STANDARDS AND A WIDE VARIETY OF PRODUCTS. FOOD PROCESSING IS A
THIRD HIGH-GROWTH AREA.
GOVERNMENT ROLE IN THE ECONOMY
THE GOVERNMENT PLAYS AN ACTIVE ROLE, CONTROLLING ABOUT 62 PERCENT OF THE
TOTAL ECONOMY. IT IS ALSO THE LARGEST EMPLOYER IN THE COUNTRY.
GOVERNMENT ENTITIES, SUCH AS THE SOCIAL SECURITY AGENCY, MAINTAIN
SIGNIFICANT INVESTMENTS IN SHAREHOLDING
COMPANIES. GOVERNMENT REGULATIONS AND PROCEDURES ARE
BUREAUCRATIC, ALTHOUGH THE LIBERALIZATION OF INVESTMENT LAWS IS
EXPECTED TO REDUCE THE BUREAUCRACY.
THE GOVERNMENT ANNOUNCED ITS INTENTION TO MOVE TOWARD THE PRIVATIZATION
OF SOME OF ITS HOLDINGS, INCLUDING PARTS OF THE JORDAN ELECTRICITY
AUTHORITY (JEA) AND ROYAL JORDANIAN AIRLINES (RJ). JEA IS SPINNING OFF
ITS DISTRIBUTION NETWORK INTO A SHAREHOLDING COMPANY, STILL LARGELY
OWNED BY THE GOVERNMENT. RJ INTENDS TO MOVE FROM DIRECT GOVERNMENT
OWNERSHIP TO A COMBINATION OF INDIRECT GOVERNMENT OWNERSHIP THROUGH
GOVERNMENTAL ENTITIES SUCH AS THE SOCIAL SECURITY CORPORATION AND THE
CONVERSION OF DEBT TO EQUITY THROUGH THE ISSUANCE OF SHARES.
HOST COUNTRY BUDGET PRIORITIES & PRIVATIZATION
JORDAN'S USD 2.4 BILLION BUDGET FOR 1994, AS APPROVED BY PARLIAMENT,
REFLECTS THE GOVERNMENT'S CONTINUED COMMITMENT TO THE IMF STRUCTURAL
ADJUSTMENT PROGRAM. TOTAL REVENUES ARE EXPECTED TO INCREASE BY 8.7
PERCENT TO USD 2.32 BILLION. EXPENDITURES WILL RISE BY ABOUT 16.2
PERCENT TO USD 2.39 BILLION, LARGELY DUE TO A LARGE INCREASE IN CAPITAL
EXPENDITURES.
THE GOVERNMENT HAS SET THE FOLLOWING BUDGET TARGETS FOR 1995:
-- GDP GROWTH: 10 PERCENT AT CURRENT PRICES, 6 PERCENT AT FIXED PRICES;
-- INFLATION: 5 PERCENT, ONE PERCENT ABOVE 1994;
-- BUDGET DEFICIT BEFORE GRANTS: 4.3 PERCENT OF GDP;
-- THE CURRENT ACCOUNT DEFICIT: 8 PERCENT, DOWN FROM 8.8 PERCENT
IN 1994.
-- TRADE BALANCE DEFICIT: 33.5 PERCENT, DOWN FROM 34.6 PERCENT IN 1994;
-- GROSS CONSUMPTION: 94.4 PERCENT OF GDP, AGAINST 97.1 PERCENT
IN 1994; AND
-- RATIO OF INVESTMENT TO GDP: 27.4 PERCENT, AGAINST 28.6 PERCENT
IN 1994.
BALANCE OF PAYMENTS SITUATION
JORDAN HAS SUCCESSFULLY MANAGED ITS BALANCE OF PAYMENTS SITUATION
THROUGH A COMBINATION OF PAYMENTS, RENEGOTIATION GOVERNMENT-TO-
GOVERNMENT (PARIS CLUB) AND COMMERCIAL BANKING LOANS (LONDON CLUB), AND
NEGOTIATION OF AN IMF STRUCTURAL ADJUSTMENT AND STANDBY AGREEMENT.
JORDAN HAS SURPASSED THE IMF TARGETS ESTABLISHED FOR IT IN THE LAST TWO
YEARS. ITS OVERALL BALANCE OF PAYMENTS DEFICIT AMOUNTED TO USD 27
MILLION IN 1994, WHICH WAS COVERED BY RESCHEDULING DEBT, RECONCILIATION
OF ARREARAGES WITH INTERNATIONAL LENDING ORGANIZATIONS, REMITTANCES AND
OTHER FOREIGN EXCHANGE RECEIPTS, SUCH AS TOURISM.
JORDAN'S OVERALL INDEBTEDNESS STANDS AT ABOUT USD 6.6 BILLION,
APPROXIMATELY 107 PERCENT OF GDP. THE GOVERNMENT IS AIMING TO REDUCE
ITS FOREIGN DEBT TO 100 PERCENT OF GDP BY 1998. JORDAN REGISTERED A 14
PERCENT IMPROVEMENT IN ITS TRADE BALANCE DEFICIT IN 1994 DUE TO
INCREASES IN EXPORTS AND RE-EXPORTS OF 15 AND 16 PERCENT, RESPECTIVELY,
AND A DECREASE IN IMPORTS BY 3.7 PERCENT. MOREOVER, INCREASED LEVELS OF
WORKER REMITTANCES AND TOURISM RECEIPTS REDUCED THE CURRENT ACCOUNT
DEFICIT BY 50.9 PERCENT TO USD 336 MILLION IN 1994. JORDAN'S FOREIGN
EXCHANGE RESERVES DROPPED FROM APPROXIMATELY USD 450 MILLION TO USD 280
MILLION IN MID-1994, BUT STAND AT 400 MILLION IN THE FIRST QUARTER OF
1995.
INFRASTRUCTURE SITUATION RE: GOODS/SERVICES DISTRIBUTION
JORDAN'S ROAD NETWORK, CONSISTING OF 8,000 KM OF SURFACED ROADS, HAS
IMPROVED DRAMATICALLY DURING THE LAST TEN YEARS. THERE ARE TWO MAJOR
HIGHWAYS FROM THE NORTH BORDER WITH SYRIA TO AMMAN, CONTINUING SOUTH TO
THE PORT OF AQABA AND SOUTHEAST TO SAUDI ARABIA, AND UPGRADED OR NEW
HIGHWAYS GOING EAST FROM AMMAN TO IRAQ AND WEST TOWARD THE WEST BANK AND
ISRAEL. BY-PASS ROADS ROUTE LONG-DISTANCE TRUCKING AROUND AMMAN.
JORDAN'S RAILWAY LINE IS CURRENTLY USED ONLY FOR TRANSPORTATION OF
PHOSPHATE ROCK FROM THE MINES TO THE PORT OF AQABA.
THE PORT OF AQABA IS MODERN AND WELL-ORGANIZED WITH SEPARATE SECTIONS
FOR CONTAINERS AND BULK SHIPMENTS. THE PORT WAS BUILT TO ACCOMMODATE 35
MILLION TONS PER YEAR. PRIOR TO THE GULF WAR, 27 MILLION TONS OF CARGO
PASSED THROUGH THE PORT OF AQABA. THIS FIGURE DROPPED TO 11 MILLION
TONS DUE TO THE GULF WAR AND SUBSEQUENT U.N. SANCTIONS AGAINST IRAQ.
THERE ARE TWO INTERNATIONAL AIRPORTS, QUEEN ALIA INTERNATIONAL (QAI)
NEAR AMMAN AND AQABA AIRPORT. QAI WAS DESIGNED FOR THREE MILLION
PASSENGERS A YEAR AND IS EXPECTED TO ACCOMMODATE 430,000 TONS OF AIR
CARGO BY THE YEAR 2000. THE JORDANIAN AND ISRAELI GOVERNMENTS ARE
CURRENTLY DISCUSSING EXPANSION OF THE AQABA AIRPORT AND ITS USE BY
INTERNATIONAL FLIGHTS DESTINED FOR BOTH AQABA AND EILAT, ISRAEL'S RESORT
CITY ON THE GULF OF AQABA. A STUDY OF THE EXPANSION PROJECT IS BEING
FUNDED BY THE U.S. TRADE DEVELOPMENT AGENCY. BOTH AIRPORTS ARE ADJACENT
TO MAJOR HIGHWAYS. MARKA AIRPORT, THE OLD AMMAN AIRPORT, IS STILL USED
FOR EXECUTIVE JET CHARTER SERVICES.
MAJOR INFRASTRUCTURE PROJECTS UNDERWAY
IN MID-1995, THE GOVERNMENT AWARDED A CONTRACT TO ABB FOR THE AQABA
THERMAL POWER SECOND STAGE EXPANSION. THIS PROJECT WILL ADD TWO 130
MEGAWATT GENERATORS TO PROVIDE MUCH OF THE ELECTRICITY TO THE SOUTH OF
JORDAN AS WELL AS A POSSIBLE SUPPLY TO SINAI. A LATER THIRD STAGE
ANTICIPATES THE INSTALLATION OF AN ADDITIONAL TWO GENERATORS OF GREATER
CAPACITY.
USAID IS PROVIDING BETWEEN USD 10-12 MILLION OF A USD 40 MILLION PROJECT
FOR THE CONSTRUCTION OF A WATER TREATMENT PLANT AT KHIRBET AS-SAMRA.
RECONSTRUCTION OF THE WATER AND SEWAGE NETWORK IN IRBID BEGAN IN 1993.
MOST OF THE WATER AND SEWAGE PROJECTS ARE FUNDED WHOLLY OR IN PART BY
DEVELOPMENT ASSISTANCE LOANS AND GRANTS. THE AL-KARAMAH DAM WILL BE A
MAJOR CONSTRUCTION PROJECT TO FURTHER DEVELOP JORDAN'S LIMITED WATER
RESOURCES.
TRANSPORTATION PROJECTS RECENTLY COMPLETED: THE NAOUR-DEAD SEA HIGHWAY
AND THE AMMAN-IRBID HIGHWAY WERE COMPLETED IN 1994. A NEW SCENIC ROAD
BORDERING THE EASTERN SHORE OF THE DEAD SEA WAS OPENED IN EARLY 1995. A
PROPOSED HIGHWAY LINKING AQABA, EILAT AND TABA, EGYPT IS UNDER
DISCUSSION. A RAIL LINE IS EXPECTED TO CONNECT THE NEW IRSHEDIYEH
PHOSPHATE MINE IN SOUTHERN JORDAN TO THE MAIN LINE GOING TO THE PORT OF
AQABA. IN AQABA, A NEW GENERAL CARGO JETTY IS PLANNED FOR THE NEAR
FUTURE.
TELECOMMUNICATIONS PROJECTS FOR INCREASING THE NUMBER OF LAND LINES AND
NATIONAL AND REGIONAL SWITCHING STATIONS HAVE BEEN AWARDED. THE
GOVERNMENT WILL ALSO REPLACE JORDAN'S SATELLITE EARTH STATIONS. THE
CONTRACT FOR DEVELOPMENT OF A CELLULAR TELEPHONE SYSTEM WAS AWARDED TO
MOTOROLA. THE SYSTEM SHOULD BE OPERATIONAL BY LATE 1995.
BOTH THE FREE ZONES AUTHORITY AND THE JORDAN INDUSTRIAL ESTATES ARE
PLANNING EXPANSION PROJECTS. FREE ZONES WILL OPEN IN MAFRAQ, THE JORDAN
VALLEY AND IN AQABA. INDUSTRIAL ESTATES ARE PLANNED FOR AMMAN (NEAR QAI
AIRPORT), SALT, TAFILA AND KERAK.
THE DISI PROJECT FOR DUAL WATER CONVEYANCE FROM A SOUTHERN JORDAN
AQUIFER TO AMMAN IS ALSO PLANNED. UNDER THE JORDAN RIFT VALLEY
INITIATIVE, THE GOVERNMENT IS ALSO STUDYING CONSTRUCTION OF A CANAL FROM
THE RED SEA TO THE DEAD SEA ON THE BORDER OF JORDAN AND ISRAEL, WHICH
WOULD SUPPLY ELECTRICITY, FRESH WATER FOR DRINKING AND SALTY WATER TO
THE DEAD SEA. THE DEAD SEA REGION IS TARGETED FOR DEVELOPMENT AS A
TOURIST PARK.
MAJOR LOCAL AND THIRD-COUNTRY COMPETITORS IN SPECIFIC SECTORS
COMPETITION IN KEY SECTORS TRADITIONALLY HAS COME FROM THE FRENCH,
JAPANESE, ITALIANS, GERMANS, BRITISH AND KOREANS, IN ADDITION TO LOCAL
COMPANIES.
IN CONSTRUCTION, ONE OF THE LARGEST LOCAL COMPANIES IS ZEYAD SALAH AND
PARTNERS CONSTRUCTION, BUT THE JAPANESE HAVE ALSO BEEN ACTIVE. IN
TELECOMMUNICATIONS, THE FRENCH AND JAPANESE HAVE BEEN THE MOST
AGGRESSIVE COMPETITORS. ITALIANS AND GERMANS SUPPLY NEARLY TWO-THIRDS OF
JORDAN'S REQUIREMENTS FOR MACHINERY USED FOR MANUFACTURING. THE U.S.,
JAPAN, FRANCE AND GERMANY SUPPLY TWO-THIRDS OF HIGH TECHNOLOGY MEDICAL
AND LABORATORY EQUIPMENT.
JAPANESE, GERMAN AND KOREAN AUTOMOBILES DOMINATE THE LOCAL MARKET, WITH
RUSSIAN AND UKRAINIAN VEHICLES AT THE LOW END OF THE MARKET. AMERICAN
VEHICLES HAVE BEEN HINDERED BY HIGH CUSTOMS TARIFFS IMPOSED ON THE BASIS
OF ENGINE DISPLACEMENT. THE U.S. GOVERNMENT AND U.S. AUTO MANUFACTURERS
CONTINUE TO PRESSURE THE JORDANIAN GOVERNMENT TO MODIFY THIS CUSTOMS
REGULATION. JORDAN'S PARLIAMENT RECENTLY APPROVED LEGISLATION PROVIDING
DUTY-FREE IMPORT PRIVILEGES TO TAXI OWNERS FOR AUTOMOBILES WITH ENGINE
DISPLACEMENT GREATER THAN 1.6 CC. THERE ARE AN ESTIMATED 12,000-15,000
TAXIS IN JORDAN. U.S. FIRMS REMAIN VERY COMPETITIVE IN THE CONSTRUCTION
EQUIPMENT MARKET.
CHAPTER III. POLITICAL ENVIRONMENT
NATURE OF BILATERAL RELATIONSHIP WITH THE UNITED STATES
JORDAN HAS HAD STRONG RELATIONS WITH THE UNITED STATES SINCE 1949. THE
U.S. IS ONE OF JORDAN'S LARGEST TRADING PARTNERS AND HAS PROVIDED
ECONOMIC AND MILITARY ASSISTANCE SINCE THE LATE 1940'S. SINCE THE
CONCLUSION OF THE JORDAN-ISRAEL PEACE TREATY IN 1994, THE U.S. HAS
REITERATED ITS COMMITMENT TO HELP JORDAN MEET THE NEW CHALLENGES IT
FACES AS PART OF LARGER U.S. EFFORTS TO PROMOTE A COMPREHENSIVE PEACE
SETTLEMENT BETWEEN ISRAEL AND THE ARAB STATES.
MAJOR POLITICAL ISSUES AFFECTING THE BUSINESS CLIMATE
JORDAN'S GEOGRAPHY IS A KEY FACTOR IN THE COUNTRY'S FOREIGN POLICY. THE
JORDAN-ISRAEL PEACE TREATY PRESENTS NEW ECONOMIC POSSIBILITIES FOR
JORDAN OVER THE LONG TERM, THOUGH A WIDESPREAD PUBLIC SENSE THAT JORDAN
WILL ONLY SLOWLY ENJOY THE FRUITS OF PEACE HAS ENGENDERED SKEPTICISM IN
THE IMMEDIATE TERM. OPPONENTS OF PEACE AND NORMALIZATION WITH ISRAEL
ARE TRYING TO EXPLOIT THIS SKEPTICISM FOR POLITICAL GAIN, BUT THEIR
OVERALL APPEAL AND ABILITY TO CHANGE GOVERNMENT POLICY IS LIMITED.
JORDAN'S RELATIONS WITH THE GULF STATES AFTER THE IRAQI INVASION OF
KUWAIT REMAIN STRAINED, ESPECIALLY WITH SAUDI ARABIA AND KUWAIT. THIS
SITUATION HAMPERS TRADE WITH THE GULF. UNITED NATIONS SANCTIONS WITH
IRAQ HAVE ALSO SIGNIFICANTLY REDUCED TRADE WITH THAT COUNTRY. JORDANIAN
BUSINESSMEN STILL EXPECT THAT JORDANIAN TRADE TO IRAQ WILL INCREASE
DRAMATICALLY ONCE THE EMBARGO IS LIFTED OR AT LEAST EASED.
BRIEF SYNOPSIS OF POLITICAL SYSTEM, SCHEDULE FOR ELECTIONS, AND
ORIENTATION OF MAJOR POLITICAL PARTIES
JORDAN IS A CONSTITUTIONAL MONARCHY RULED, SINCE 1952, BY HIS MAJESTY
KING HUSSEIN IBN TALAL. UNDER THE CONSTITUTION, POWER IS VESTED IN THE
KING AND THE PARLIAMENT, WHICH CONSISTS OF A SENATE AND A HOUSE OF
REPRESENTATIVES. THE SENATE IS COMPRISED OF 40 APPOINTED MEMBERS, WHILE
THE HOUSE OF REPRESENTATIVES IS COMPRISED OF 80 ELECTED MEMBERS. THE
KING APPOINTS THE PRIME MINISTER AND THE PRESIDENT AND MEMBERS OF THE
SENATE. THE PRIME MINISTER FORMS A CABINET TO MANAGE THE INTERNAL AND
EXTERNAL AFFAIRS OF THE GOVERNMENT AND IS THE GOVERNMENT'S WORKING
PARTNER WITH THE HOUSE OF REPRESENTATIVES.
AFTER A LONG HIATUS, PARLIAMENTARY ELECTIONS WERE HELD IN NOVEMBER 1989
AND AGAIN IN NOVEMBER 1993. REPRESENTATIVES SERVE A FOUR-YEAR TERM.
POLITICAL PARTIES WERE LEGALIZED IN 1992. OF THE APPROXIMATELY 22
POLITICAL PARTIES, THE LARGEST AND MOST COHESIVE IS THE ISLAMIC ACTION
FRONT (IAF), AN ARM OF THE MUSLIM BROTHERHOOD. THE IAF CAPTURED 16
SEATS, THE LARGEST BLOC, IN PARLIAMENT. THE OTHER POLITICAL PARTIES
HAVE NOT YET COALESCED INTO WELL-ORGANIZED BODIES. THESE PARTIES
REPRESENT THE FULL SPECTRUM OF POLITICAL VIEWS FROM RIGHT TO LEFT, BUT
MOST TEND TO BE CENTRIST.
CHAPTER IV. MARKETING U.S. PRODUCTS AND SERVICES
DISTRIBUTION AND SALES CHANNELS, USE OF AGENTS ANDDISTRIBUTORS, AND
FINDING A PARTNER
AMERICAN FIRMS INTERESTED IN EXPORTING TO JORDAN SHOULD APPOINT LOCALLY-
REGISTERED JORDANIAN AGENTS OR DISTRIBUTORS. THE COMMERCIAL AGENTS AND
MIDDLEMEN LAW NO. 44 OF 1985 STIPULATES THAT NO FOREIGN FIRM MAY IMPORT
GOODS INTO THE COUNTRY WITHOUT APPOINTING A REGISTERED AGENT. THE
AGENT'S CONNECTION TO THE FOREIGN COMPANY MUST BE DIRECT, WITHOUT A SUB-
AGENT OR INTERMEDIARY. EXCEPT FOR THE BASIC DEFINITIONS STIPULATED IN
THE COMMERCIAL CODE, THERE ARE NO REGULATIONS GOVERNING THE CONTRACT
BETWEEN THE FOREIGN FIRM AND THE COMMERCIAL AGENT.
MOST OF LAW NO. 44 AFFECTS THE DEALINGS OF LOCAL AGENTS. THE MOST
SIGNIFICANT PROVISIONS AFFECTING THE PRINCIPAL/AGENT RELATIONSHIP ARE:
A. JORDANIAN AGENTS OR DISTRIBUTORS OF FOREIGN COMPANIES ARE ALWAYS
ENTITLED TO COMPENSATION FOR UNJUSTIFIED TERMINATION OF THE AGENCY
CONTRACT, NOTWITHSTANDING ANY AGREEMENT TO THE CONTRARY;
B. THE JORDANIAN COURTS HAVE JURISDICTION OVER ALL DISPUTES ARISING
OUT OF THE AGENCY/DISTRIBUTORSHIP CONTRACT, NOTWITHSTANDING ANY
AGREEMENT TO THE CONTRARY. HOWEVER, THE CHOICE OF THE FOREIGN LAW TO
GOVERN THE AGENCY/DISTRIBUTORSHIP ARRANGEMENT BETWEEN THE PARTIES IS
PERMITTED AND ENFORCED BY THE JORDANIAN COURTS; AND
C. IT IS ILLEGAL FOR A FOREIGN COMPANY TO APPOINT AN AGENT AND PAY
COMMISSIONS IF THE JORDANIAN COMPANY IS SELLING ARMS OR MUNITIONS TO THE
GOVERNMENT OF JORDAN.
ONCE A CONTRACT IS REACHED, THE AGENT MUST TAKE THE SIGNED AGREEMENT TO
THE REGISTRAR OF COMPANIES AT THE MINISTRY OF INDUSTRY AND TRADE. THE
MINISTRY ISSUES A REGISTRATION NUMBER, WHICH THEN MUST BE CITED IN ALL
SUBSEQUENT IMPORT LICENSE APPLICATIONS FOR GOODS UNDER THE CONTRACT.
FRANCHISING
JORDANIAN BUSINESSMEN HAVE EXPRESSED INCREASING THEIR INTEREST IN
FRANCHISING,ESPECIALLY IN INDUSTRY, SERVICES, AND FAST FOOD. HOWEVER,
THEIR ACTUAL FAMILIARITY WITH THE CONCEPT IS LIMITED. RETAIL AND
SERVICE FRANCHISES ARE RARE IN JORDAN.
DIRECT MARKETING
DIRECT MARKETING OF U.S. PRODUCTS AND SERVICES IS USUALLY HANDLED BY
AGENTS/DISTRIBUTORS, IMPORTERS AND REGISTERED BRANCH OFFICES OF AMERICAN
COMPANIES. AMERICAN BUSINESSES ALSO MARKET THEIR PRODUCTS BY
PARTICIPATING IN EXHIBITIONS OR TRADE EVENTS, USING EMBASSY COMMERCIAL
SECTION EXPORT PROMOTION SERVICES AND SENDING REPRESENTATIVES TO DISCUSS
BUSINESS PROSPECTS DIRECTLY WITH JORDANIAN END-USERS.
JOINT VENTURES/LICENSING
THE INCREASED AVAILABILITY OF DOMESTIC CAPITAL HAS FUELED THE INTEREST
OF LOCAL INVESTORS IN ACQUIRING INDUSTRIAL LICENSES AND ESTABLISHING
JOINT-VENTURES. PROMISING OPPORTUNITIES INCLUDE FERTILIZERS AND AGRO-
CHEMICALS, INFORMATION SYSTEMS AND TECHNOLOGIES, COMPUTER PRODUCTS,
ENVIRONMENTAL PRODUCTS AND TECHNOLOGIES, AUTOMOBILES, ELECTRONICS,
COMPUTER PERIPHERALS AND HARDWARE ASSEMBLY, POWER AND ENERGY,PACKING AND
PACKAGING, FOOD PROCESSING AND MACHINERY BUILDING, FOOD CANNING AND
REFRIGERATION AND REPLACEMENT PARTS. MANY AMERICAN COMPANIES ALREADY
HAVE LICENSING ARRANGEMENTS WITH JORDANIAN MANUFACTURERS. JOINT
VENTURES ARE LESS COMMON, ALTHOUGH ONE WAS ESTABLISHED IN 1993.
HOWEVER, JORDANIAN BUSINESSES HAVE SHOWN INCREASING INTEREST IN FORMING
JOINT VENTURES.
STEPS TO ESTABLISHING AN OFFICE
THE COMPANIES ACT OF 1989 PROVIDES GUIDANCE FOR REGISTERING FOREIGN
COMPANIES AND ESTABLISHING REGIONAL AND REPRESENTATIVE OFFICES. THE LAW
DISTINGUISHES BETWEEN TWO TYPES OF FOREIGN COMPANIES: "FOREIGN COMPANIES
OPERATING IN THE KINGDOM" AND "FOREIGN COMPANIES NOT OPERATING IN THE
KINGDOM." THE FORMER INCLUDES FOREIGN FIRMS THAT HAVE ESTABLISHED
BRANCH OFFICES IN JORDAN. THE LATTER INCLUDES REPRESENTATIVE (I.E.,
REGIONAL) OFFICES, WHICH ARE NOT PERMITTED TO ACT AS COMMERCIAL AGENTS
AND MIDDLEMEN FOR BUSINESS ACTIVITIES IN JORDAN. HOWEVER, THEY ARE
ALLOWED TO SERVE AS LIAISONS BETWEEN THEIR HEAD OFFICES AND JORDANIAN OR
REGIONAL CLIENTS.
FOREIGN FIRMS EXECUTING CONTRACTS IN JORDAN ARE ENCOURAGED TO ESTABLISH
BRANCH OFFICES. THE REGISTRATION FEE IS JD 250 (USD 360) IF THE PARENT
COMPANY'S CAPITAL IS JD ONE MILLION OR BELOW AND JD 500 (USD 720) IF ITS
CAPITAL IS ABOVE JD ONE MILLION. THE REGISTRATION FEE TO ESTABLISH A
REGIONAL OFFICE IS MINIMAL.
SELLING FACTORS/TECHNIQUES
THOUSANDS OF LOCAL WHOLESALERS, SEMI-WHOLESALERS AND RETAILERS OPERATE
IN JORDAN. AMERICAN PRODUCTS MUST COMPETE IN AN OPEN TRADE ENVIRONMENT
WITH GOODS FROM ALL OVER THE WORLD. PRICE-COMPETITIVENESS IS AN
ESSENTIAL SALES REQUIREMENT. TO GAIN THE EDGE IN THE JORDANIAN MARKET,
BUSINESSMEN SEEKING TO SELL AMERICAN CAPITAL EQUIPMENT SHOULD FOCUS ON
FINANCING ARRANGEMENTS AND TECHNICAL SUPPORT. SELLERS MUST CONSIDER
SHIPPING AND FREIGHT CHARGES, AS WELL AS DELIVERY TERMS. THEY MUST ALSO
SHOW SOME FLEXIBILITY IN OFFERING INDUSTRIAL DESIGN MODIFICATIONS TO
SUIT JORDANIAN END-USERS' SPECIFICATIONS.
ADVERTISING AND TRADE PROMOTION
IN ADDITION TO USING THE EMBASSY COMMERCIAL SECTION AS A VEHICLE FOR
PROMOTION, U.S. EXPORTERS MAY ALSO PARTICIPATE IN LOCAL EXHIBITIONS AND
TRADE EVENTS. ADVERTISING IN JORDANIAN NEWSPAPERS AND BUSINESS JOURNALS
IS AN ADDITIONAL METHOD FOR LOCATING AGENTS/DISTRIBUTORS OR DIRECT
IMPORTERS. THE EMBASSY RECOMMENDS THE FOLLOWING JORDANIAN NEWSPAPERS
FOR U.S. PRODUCT ADVERTISEMENTS:
JORDAN TIMES (ENGLISH DAILY)
AL-ASWAQ (ARABIC BUSINESS DAILY)
AD-DUSTOUR (ARABIC DAILY)
AL-RAI (ARABIC DAILY)
THE STAR (ENGLISH WEEKLY)
AL-FORSA (ARABIC COMMERCIAL WEEKLY)
PRODUCT PRICING
LOCAL IMPORTERS BASE THEIR PRODUCT PRICING ON THE EXPORT PRICE, FREIGHT
COSTS, APPLICABLE IMPORT TARIFFS AND TAXES, THE SALES TAX AND THEIR
PROFIT MARGIN. PRICE CONTROLS ARE USED BY GOJ TO PREVENT UNREASONABLE
PRICE HIKES, PRODUCT HOARDING, AND DUMPING OF FOREIGN GOODS AND
SERVICES. UNDER THE SUPPLY LAW, THE GOVERNMENT MAY SET THE IMPORTER'S
PROFIT MARGIN BY USING AN INTERNATIONALLY ACCEPTED FORMULA. THE PROFIT
MARGIN ON IMPORTED FOODSTUFFS, WHICH ARE PRICE-CONTROLLED BY THE
MINISTRY OF SUPPLY, IS SET AT 17 PERCENT, WHICH INCLUDES 2 PERCENT IN
ADMINISTRATIVE AND STORAGE EXPENSES, 8 PERCENT FOR THE IMPORTER'S PROFIT
AND 7 PERCENT FOR THE RETAILER'S PROFIT. THE MINISTER OF SUPPLY HAS SET
THE PROFIT MARGIN ON IMPORTED TEA PRODUCTS AT 13 PERCENT INSTEAD OF 17
PERCENT. GOODS AND SERVICES THAT ARE NOT SUBJECT TO MINISTRY PRICE
CONTROLS ARE LEFT TO MARKET-BASED COMPETITIVE PRICING STRATEGIES. THE
PROFIT MARGIN OF DOMESTIC GOODS IS USUALLY ABOUT 10-25 PERCENT OF THE
DOMESTIC MANUFACTURER'S TOTAL COSTS.
SALES SERVICE/CUSTOMER SUPPORT
THE QUALITY OF SALES SERVICE AND CUSTOMER SUPPORT FOR AMERICAN PRODUCTS
IS HIGHER THAN IS TYPICAL IN THE JORDANIAN MARKET, AN IMPORTANT SELLING
POINT. AMERICAN FIRMS CAN IMPROVE FURTHER ON CUSTOMER SUPPORT BY
HOLDING WORKSHOPS FOR THEIR LOCAL AGENTS OR SUB-CONTRACTING TO LOCAL
SERVICE AND MAINTENANCE FIRMS. THE AVAILABILITY OF TECHNICALLY-SKILLED
LABOR IN JORDAN GIVES THE KINGDOM A COMPETITIVE ADVANTAGE AS A REGIONAL
SALES AND SERVICING CENTER.
SELLING TO THE GOVERNMENT
THE GENERAL SUPPLIES DEPARTMENT IS THE GOVERNMENT'S CENTRAL PROCUREMENT
AGENCY. DIRECT OFFER FOR LOCAL BIDS ARE NOT PERMITTED; I.E., A LOCAL
AGENT/DISTRIBUTOR OR REPRESENTATIVE MUST BE APPOINTED TO ACT ON THE
POTENTIAL AMERICAN SUPPLIER'S BEHALF. DIRECT BIDS FOR TENDERS FINANCED
BY INTERNATIONAL DONORS OR THE WORLD BANK ARE PERMITTED, AS STATED IN
THE TENDER DOCUMENTS.
PROTECTING YOUR PRODUCT FROM IPR INFRINGEMENT
THE GOJ ANNOUNCED ITS INTENT TO JOIN THE BERNE CONVENTION BY 1996. A NEW
COPYRIGHT LAW WHICH WILL ADDRESS THE INADEQUACIES OF CURRENT LAWS IS
PENDING. JORDANIAN LAW REQUIRES THE REGISTRATION OF COPYRIGHTS, PATENTS
AND TRADEMARKS. WITHOUT REGISTRATION, FOREIGN PRODUCTS DO NOT HAVE
PROTECTION. UNDER THE COPYRIGHT LAW OF 1992, ALL WORKS MUST BE
REGISTERED AT THE DEPARTMENT OF NATIONAL LIBRARIES, UNDER THE MINISTRY
OF CULTURE. TRADEMARKS AND PATENTS MUST BE REGISTERED WITH THE
REGISTRAR OF PATENTS AND TRADEMARKS AT THE MINISTRY OF INDUSTRY AND
TRADE. DUE TO WEAK GOVERNMENT IPR ENFORCEMENT, THE ACT OF REGISTERING
COPYRIGHTS, TRADEMARKS AND PATENTS DOES NOT GUARANTEE PROTECTION;
HOWEVER, IT ALLOWS THE U.S. COMPANY TO PURSUE A COURT CASE IF ITS RIGHTS
ARE VIOLATED.
NEED FOR A LOCAL ATTORNEY
FIRMS OPERATING IN JORDAN THROUGH REGISTERED BRANCH OFFICES OR REGIONAL
OFFICES MAY NEED AN ATTORNEY TO COMPLETE PAPERWORK AND REGISTRATION
REQUIREMENTS. THE LOCAL ATTORNEY MAY ALSO PROVIDE CONTINUING ADVICE ON
LAWS AND REGULATIONS AFFECTING THE U.S. COMPANIES' ACTIVITIES.
APPOINTING A LOCAL LAWYER CAN ALSO HELP ENSURE THAT COPYRIGHTS, PATENTS
AND TRADEMARK RIGHTS ARE PROTECTED.
CHAPTER V. LEADING SECTORS FOR U.S. EXPORTS AND INVESTMENT
BEST PROSPECTS FOR NON-AGRICULTURAL GOODS AND SERVICES
RANK OF NAME OF SECTOR ITA CODE
SECTOR
------- ---------------------------- --------
1- COMPUTER/PERIPHERALS CPT
2- COMPUTER SOFTWARE CSF
3- TELECOMMUNICATIONS EQUIPMENT TEL
4- MEDICAL EQUIPMENT MED
5- POLLUTION CONTROL EQUIPMENT POL
COMPUTER/PERIPHERALS
LOCAL DEMAND FOR PERSONAL COMPUTERS IS INCREASING, WITH THE LARGEST END-
USER BEING THE GOJ. SCHOOLS AND UNIVERSITIES NOW INCLUDE COMPUTER AND
DATA PROCESSING CLASSES IN THEIR CURRICULUM. DEMAND FOR COMPUTER
COMPONENTS (STORAGE DEVICES, CPU'S AND CHIPS) INCREASED BY APPROXIMATELY
60 PERCENT FROM 1991 TO 1994. COMPUTER MARKET SOURCES CLAIM THAT
AMERICAN SOFTWARE AND HARDWARE SYSTEMS MAKE UP 85 PERCENT OF THEIR LARGE
ACCOUNTS OF ACADEMIC INSTITUTIONS, BANKS, FACTORIES AND GOVERNMENT
AGENCIES EMPLOYING MORE THAN 50 EMPLOYEES. U.S. MADE COMPUTER EQUIPMENT
AND PERIPHERALS ENJOY A HIGH REPUTATION FOR THEIR SUPERIOR QUALITY, EVEN
THOUGH U.S. PRODUCTS CAN BE UP TO 25 PERCENT HIGHER IN COST THAN ASIAN
OR EUROPEAN COUNTERPARTS.
ASIAN SUPPLIERS OFFER GOOD EXPORT TERMS TO LOCAL DEALERS AND HENCE THEY
ENJOY A 3 TIMES GREATER MARKET SHARE THAN THE U.S. POST EFFORTS TO
PROMOTE THE IMPORT OF U.S. COMPUTERS AND PERIPHERALS TO JORDAN HAVE MET
WITH AN ENTHUSIASTIC RESPONSE. IN THE PAST YEAR, THE EMBASSY HAS HOSTED
THREE SEPARATE COMMERCIAL SHOWS SPECIFICALLY TARGETED AT U.S. COMPUTER
AND COMPUTER-RELATED PRODUCTS. ATTENDANCE AT ALL THREE EVENTS EXCEEDED
EXPECTATIONS.
1994 1995 1996
(IN USD MILLIONS)
TOTAL MARKET SIZE 30 35 40
TOTAL LOCAL PRODUCTION 5 6 9
TOTAL EXPORTS 3 4 6
TOTAL IMPORTS 28 33 37
IMPORTS FOR THE U.S. 10 12 14
(THE ABOVE STATISTICS ARE UNOFFICIAL ESTIMATES)
COMPUTER SOFTWARE
THE INFORMATION SYSTEMS MARKET UNDERWENT AN UNPRECEDENTED BOOM WITH THE
RETURN OF JORDANIAN EXPATRIATES FROM THE GULF AND FROM THE GROWING
PERCEPTION THAT BUSINESSES NEEDED TO INTRODUCE INFORMATION TECHNOLOGY TO
REMAIN COMPETITIVE AND PROFITABLE.
A NUMBER OF WELL-KNOWN AMERICAN SOFTWARE FIRMS ENJOY AN EXCELLENT
REPUTATION IN JORDAN. MORE STRICT ENFORCEMENT OF INTELLECTUAL PROPERTY
RIGHTS (IPR), EXPECTED BY 1996, WILL LIKELY ENCOURAGE FURTHER U.S.
COMPUTER SOFTWARE SALES TO JORDAN. TOTAL EXPORTS OF PACKAGED SOFTWARE
INCREASED BY 25 PERCENT IN 1994. MULTI-USER BUSINESS SOFTWARE,
EDUCATIONAL SOFTWARE, AND CLIENTAL ON-LINE SERVICE ARE INCREASINGLY IN
DEMAND IN THE LOCAL MARKET.
DESPITE A 20 PERCENT PRICE DISADVANTAGE AS COMPARED TO THEIR ASIAN-MADE
COUNTERPARTS, AMERICAN SOFTWARE ENJOYS A SIGNIFICANT SHARE OF THE
COMPUTER SOFTWARE MARKET.
1994 1995 1996
(IN USD MILLIONS)
TOTAL MARKET SIZE 10 12 15
TOTAL LOCAL PRODUCTION 3 4 5
TOTAL EXPORTS 2 3 4
TOTAL IMPORTS 9 11 14
IMPORTS FROM THE U.S. 5 7 9
(THE ABOVE STATISTICS ARE UNOFFICIAL ESTIMATES)
TELECOMMUNICATIONS EQUIPMENT
THE GOJ SUBMITTED THE TELECOMMUNICATIONS DRAFT LAW TO PARLIAMENT IN
1995. THIS DRAFT LAW ALLOWS PRIVATE-SECTOR FIRMS TO INVEST IN
TELECOMMUNICATION HARDWARE AND OFFER SERVICES. IT IS EXPECTED TO
ENCOURAGE SALES OF AMERICAN TELECOMMUNICATIONS EQUIPMENT TO JORDAN.
MORE TENDERS FOR MOBILE COMMUNICATION EQUIPMENT, SATELLITE TRANSMISSION
AND RECEIVING COMPONENTS, FIBER OPTIC SUPPORT STATIONS, AND MODEM-DRIVEN
LINE-CLUSTERING STATIONS ARE EXPECTED BY MID-1996. THE GOJ IS WORKING
TO ATTRACT WORLD BANK FUNDS TO FINANCE AMBITIOUS TELECOMMUNICATIONS AND
INFORMATION TECHNOLOGY PROJECTS BEFORE THE COMMENCEMENT OF THE AMMAN
ECONOMIC SUMMIT.
U.S. PRODUCTS ARE GENERALLY MORE EXPENSIVE THAN ASIAN OR EUROPEAN MADE
PRODUCTS BY APPROXIMATELY 35 PERCENT.
1994 1995 1996
(IN USD MILLIONS)
TOTAL MARKET SIZE 30 35 40
TOTAL LOCAL PRODUCTION 3 4 6
TOTAL EXPORTS 1 2 3
TOTAL IMPORTS 26 33 36
IMPORTS FROM THE U.S. 8 10 13
(THE ABOVE STATISTICS ARE UNOFFICIAL ESTIMATES)
MEDICAL EQUIPMENT
DEMAND FOR U.S. MEDICAL SUPPLIES, LABORATORY EQUIPMENT AND DIAGNOSTIC
EQUIPMENT IS INCREASING IN JORDAN. THE PRIVATE SECTOR IS A LARGE END-
USER; ANNUAL PURCHASES EXCEED GOVERNMENT PURCHASES OF MEDICAL EQUIPMENT
BY TWO FOLD. AN ADDITIONAL FIVE HOSPITALS OPENED IN JORDAN SINCE 1993
AND THREE MORE SPECIALTY HOSPITALS ARE EXPECTED TO OPEN BY 1997.
IN GENERAL, PRICES FOR U.S. MEDICAL EQUIPMENT IS COMPARABLE TO GERMAN
MADE PRODUCTS DUE TO THE EURO-DOLLAR RATE AND THE SHIFT IN PLANT
SPECIALIZATIONS.
1994 1995 1996
(IN USD MILLIONS)
TOTAL MARKET SIZE 25 30 35
TOTAL LOCAL PRODUCTION 2 3 4
TOTAL EXPORTS 1 1 1
TOTAL IMPORTS 24 28 32
IMPORTS FROM THE U.S. 7 9 12
(THE ABOVE STATISTICS ARE UNOFFICIAL ESTIMATES)
POLLUTION CONTROL EQUIPMENT
THE INCREASE IN DEMAND FOR U.S. POLLUTION CONTROL EQUIPMENT JUMPED BY 80
PERCENT DUE TO THE HIGH REPUTATION OF U.S.-MADE EQUIPMENT AND TO EFFORTS
OF THE GOJ AND VOLUNTARY ORGANIZATIONS TO ENHANCE PUBLIC AWARENESS OF
ENVIRONMENTAL PROTECTION. THE GOJ SUBMITTED THE ENVIRONMENT LAW TO THE
PARLIAMENT IN MAY AND IT IS EXPECTED TO PASS INTO LAW BY 1996. MORE
THAN 30 FIRMS IN JORDAN SELL POLLUTION CONTROL AND WATER TREATMENT
EQUIPMENT. ABOUT 18 U.S. FIRMS HAVE ENTERED THE MARKET SINCE 1993.
PRIVATE SECTOR DEMAND FOR U.S. EQUIPMENT INCREASED FROM USD 7 MILLION IN
1992 TO USD 13 MILLION BY THE FIRST QUARTER OF 1995.
U.S. PRODUCTS ARE APPROXIMATELY 40 PERCENT MORE EXPENSIVE THAN
COMPARABLE BRITISH AND FRENCH PRODUCTS. DUE THE LEADING POSITION OF THE
U.S. IN WATER PURIFICATION AND FILTRATION TECHNOLOGY, EUROPEAN
COMPETITORS HAVE RETREATED FROM THESE SECTORS MAKING U.S. PRODUCTS MORE
COMPETITIVE. U.S. PRODUCTS HOLD NEARLY 50 PERCENT OF JORDAN'S OVERALL
POLLUTION CONTROL MARKET.
1994 1995 1996
(IN USD MILLIONS)
TOTAL MARKET SIZE 13 15 18
TOTAL LOCAL PRODUCTION 2 3 5
TOTAL EXPORTS 1 1 1
TOTAL IMPORTS 12 13 14
IMPORTS FROM THE U.S. 9 11 13
(THE ABOVE STATISTICS ARE UNOFFICIAL ESTIMATES)
BEST PROSPECTS FOR AGRICULTURAL PRODUCTS
(SEE APPENDIX C FOR A LISTING OF TOP U.S. AGRICULTURAL IMPORTS)
SIGNIFICANT INVESTMENT OPPORTUNITIES
SECTOR: PROJECTS EST. COST CLASS FINANCE
------- -------- --------- ----- -------
ENERGY: POWER SYSTEM 224 N&R G
INTERCONNECTION
ENVIRONMENT: HAZARDOUS WASTE 25 N&R G&P
MANAGEMENT
MINERALS&INDSTY:
INDUSTRIAL WORKSHOPS 4 N P
POTASSIUM SULPHATE & 85 N P
DICALCIUM PHOSPHATE PLANT - - -
MAGNESIUM OXIDE PLANT 125 N P
PHOSPHORIC ACID COMPLEX 350 N P
INDUSTRIAL MINERALS N/A N P
COPPER EXPLORATION N/A N P
GRANITE QUARRYING N/A N P
OIL & GAS EXPLORATION N/A N P
BROMINE & DERIVATIVES 150 N P
TRANSPORT:
JORDAN RIVER BRIDGES:
KING HUSSEIN BRIDGE 14 R G&P
KING ABDULLAH BRIDGE 14 R G&P
JORDAN VALLEY CROSSING BRIDGE 9 R G&P
PRINCE MOHAMMED BRIDGE 11 R
WESTERN BOARDER HIGHWAY:
IRBID-NORTH SHUNA HIGHWAY 18 R G
AQABA COASTAL HIGHWAY 26 R G
KUFUR HUDA-DAMIA JUNCT. HWY 30 R G
SOUTH SHUNA-NORTH SHUNA HWY. 102 R G
RAILWAY:
AQABA-WADI II RAILWAY & 55 N P
ESHIDIYA LINK
SEA PORTS:
MULTI-PURPOSE JETTY 25 R P
PASSENGER BERTH 10 R P
AIRPORTS:
AQABA INTERNATIONAL AIRPORT 40 R G
TELECOMMUNICATIONS:
FREQUENCY MANAGEMENT 10 N/R G
& LICENSING
DIGITAL TELECOMMUNICATION 300 N G
INFRASTRUCTURE
NATIONAL INFORMATICS 20 N G&P
INFRASTRUCTURE
PRIVATE SECTOR OPPORTUNITY N/A N P
PROJECTS
(PROJECTS TARGETED FOR THE AMMAN ECONOMIC SUMMIT OCTOBER 29-31)
ESTIMATED COST IN USD MILLIONS; N DENOTES NATIONAL PROJECTS; R DENOTES
REGIONAL PROJECT; P DENOTES PRIVATE SECTOR FINANCING; AND G DENOTES
GOVERNMENT FINANCING).
THE GOVERNMENT OF THE UNITED STATES ACKNOWLEDGES THE CONTRIBUTION THAT
OUTWARD FOREIGN DIRECT INVESTMENT IS INCREASINGLY VIEWED AS COMPLEMENT
OR EVEN A NECESSARY COMPONENT OF TRADE. FOR EXAMPLE, ROUGHLY 60 PERCENT
OF U.S. EXPORTS ARE SOLD BY AMERICAN FIRMS THAT HAVE OPERATIONS ABROAD.
RECOGNIZING THE BENEFITS THAT U.S. OUTWARD INVESTMENT BRINGS TO THE U.S.
ECONOMY, THE GOVERNMENT OF THE UNITED STATES UNDERTAKES INITIATIVES,
SUCH AS OVERSEAS PRIVATE INVESTMENT CORPORATION (OPIC) PROGRAMS,
INVESTMENT TREATY NEGOTIATIONS AND BUSINESS FACILITATION PROGRAMS, THAT
SUPPORT U.S. INVESTORS.
CHAPTER VI. TRADE REGULATIONS AND STANDARDS
TRADE BARRIERS, TARIFFS, NON-TARIFF BARRIERS AND IMPORT TAXES
ACCORDING TO THE ARAB BOYCOTT OF ISRAEL LAW OF 1958, JORDANIAN IMPORTERS
AND EXPORTERS ARE PROHIBITED FROM TRADING WITH ISRAELI COMPANIES OR WITH
FOREIGN COMPANIES DOING BUSINESS WITH ISRAEL. HOWEVER, THIS LAW WAS
VOIDED BY THE SIGNING OF THE PEACE AGREEMENT BETWEEN JORDAN AND ISRAEL.
A LAW FORMALLY ABOLISHING THE BOYCOTT LAW IS EXPECTED TO PASS IN
PARLIAMENT IN 1995.
MOST IMPORTS INTO JORDAN ARE SUBJECT TO TARIFFS AND IMPORT TAXES.
INDUSTRIAL RAW MATERIALS AND CAPITAL EQUIPMENT IMPORTED BY - 18 -
LICENSED INDUSTRIAL PROJECTS ARE EXEMPT. IMPORT TARIFFS RANGE BETWEEN
5-45 PERCENT ON MOST COMMODITIES. TARIFFS ON LUXURY ITEMS ARE HIGHER,
RANGING BETWEEN 60-120 PERCENT. AUTOMOBILES TARIFFS ARE 130-300
PERCENT. ALL IMPORTS INTO JORDAN, EXCEPT THOSE EXEMPTED BY LAW OR
REGULATION, ARE SUBJECT TO THE FOLLOWING IMPORT DUTIES, FEES AND TAXES:
A. IMPORT TARIFF;
B. SALES TAX (7 PERCENT; CERTAIN IMPORTS SUBJECT TO EXCISE
TAXES PAY MORE THAN 10 PERCENT); AND
C. IMPORT TAXES AND FEES (21.06 PERCENT):
5 PERCENT IMPORT LICENSE FEES
6 PERCENT UNIFORM ADDITIONAL DUTIES
6 PERCENT UNIVERSITY AND MUNICIPAL DUTIES
3 PERCENT ADDITIONAL TAX (IMPORTS WHICH ARE EXEMPTED
FROM IMPORT DUTIES PAY 5 PERCENT ADDITIONAL TAX)
1 PERCENT COMMERCIAL CENTERS DUTY
.02 PERCENT PER THOUSAND OVERTIME FEES
.04 PERCENT PER THOUSAND CUSTOMS SERVICE DUTY
IMPORTERS WHO DO NOT PRESENT AN IMPORT LICENSE MAY BE SUBJECT TO A TEN
PERCENT FINE. THIS INCLUDES THE FIVE PERCENT IMPORT LICENSE FEE PLUS A
FIVE PERCENT PENALTY. IMPORTERS WHO DO NOT PRESENT A CERTIFICATE OF
ORIGIN AND AN INVOICE MAY BE FINED TWO PERCENT FOR EACH DOCUMENT.
IMPORTERS WHO PRESENT A FAULTY CERTIFICATE OF ORIGIN ARE LIABLE TO A ONE
PERCENT FINE. THOSE PRESENTING INVOICES THAT SHOW AN ERROR IN THE
QUANTITY SHIPPED, WHETHER A SHORTAGE OR AN EXCESS, MAY BE ACCUSED OF
SMUGGLING AND ASSESSED FINES AND PENALTIES EQUAL TO THREE TIMES THE
VALUE OF THE IMPORT DUTIES DUE. GOODS IN TRANSIT ARE SUBJECT TO A .02
PERCENT PER THOUSAND CUSTOMS SERVICE DUTY AND A .01 PERCENT PER THOUSAND
OVERTIME FEE. THE AGGREGATE RATES OF IMPORT DUTIES, TAXES, FEES AND
FINES ARE MULTIPLIED BY THE CUSTOMS-DETERMINED VALUE OF THE IMPORTED
GOODS TO DETERMINE THE TOTAL AMOUNT OF TARIFFS AND DUTIES PAYABLE TO THE
CUSTOMS DEPARTMENT.
CUSTOMS VALUATION
GENERALLY, CUSTOMS VALUATION OFFICERS DO NOT ACCEPT THE VALUE OF
IMPORTED GOODS AS STATED ON THE INVOICE AND MAY ADD AN ADDITIONAL
PERCENTAGE POINT TO RAISE IT TO A LEVEL DEEMED APPROPRIATE. THIS IS
PERMITTED BY LAW, UNDER THE ASSUMPTION THAT IMPORTERS DO NOT REPORT THE
TRUE VALUE OF THEIR IMPORTS. THE ADDED AMOUNT IS CONSIDERED A PENALTY
VALUED BY THE CUSTOMS OFFICER IN PERCENTAGE TERMS AND PAYABLE BY THE
IMPORTER. THE EXPORTER IS EXPECTED TO INCLUDE IN HIS SALES PRICE ALL
EXPENSES RELATED TO THE SALE AND DELIVERY OF GOODS UNTIL ARRIVAL AT THE
POINT OF ENTRY. LOCAL AGENTS ESTIMATE THAT, IN GENERAL, UP TO 85
PERCENT OF THE GOODS IMPORTED INTO JORDAN ARE OVERVALUED BY CUSTOMS.
ACCORDING TO ARTICLE 39 OF THE CUSTOMS LAW, THE PRICE OF IMPORTS
INCLUDES THE RIGHT OF THE IMPORTER TO USE THE PATENTS, DESIGNS, FORMS,
MANUFACTURING MARKS AND TRADEMARKS RELATED TO THE PRODUCT IF IT IS
MANUFACTURED ACCORDING TO A REGISTERED DESIGN AND FORM OR HAS A FOREIGN
MANUFACTURING MARK OR A TRADEMARK. THE CUSTOMS LAW STIPULATES THAT THE
VALUE OF THE GOODS, IF STATED IN FOREIGN CURRENCY, SHOULD BE CONVERTED
TO DINARS AT THE RATE SET BY THE CENTRAL BANK AS OF THE DATE OF THE
CUSTOMS DECLARATION. THE ABSENCE OF REQUIRED IMPORT DOCUMENTATION GIVES
THE CUSTOMS VALUATION OFFICER THE RIGHT TO DETERMINE THE VALUE OF THE
IMPORTED GOODS AS HE SEES APPROPRIATE.
INVOICE OR EXPORT DISCOUNTS ARE NOT ACCEPTED BY THE CUSTOMS DEPARTMENT.
IF THE EXPORTER AGREES TO GIVE A DISCOUNT, HE SHOULD CONSULT THE LOCAL
IMPORTER TO DETERMINE WHETHER IT SHOULD BE GRANTED DIRECTLY OR
INDIRECTLY. ALTHOUGH IT IS LEGAL, AN "AGENT'S DISCOUNT" MAY NOT BE
ACCEPTED BY THE CUSTOMS DEPARTMENT.
IMPORT LICENSES
ACCORDING TO IMPORT/EXPORT REGULATION NO. 74 OF 1993, AN IMPORT LICENSE
IS NOT REQUIRED EXCEPT IN SPECIFIC CASES. HOWEVER THE MINISTER OF
INDUSTRY AND TRADE HAS NOT YET ISSUED INSTRUCTIONS MANDATING THAT
LICENSES BE WAIVED ON GOODS IMPORTED BY LOCAL BUSINESSMEN. THESE
INSTRUCTIONS WILL HAVE TO BE PASSED TO THE DEPARTMENT OF CUSTOMS THROUGH
THE MINISTER OF FINANCE. UNTIL SUCH TIME, THE CUSTOMS DEPARTMENT WILL
CONTINUE TO REQUIRE AN IMPORT LICENSE AT THE CLEARING POINT.
EXPORT CONTROLS
THE IMPORT/EXPORT LAW NO. 14 OF 1993 AND THE IMPORT/EXPORT REGULATION
NO. 74 OF 1993 GOVERN GENERAL EXPORT CONTROL ISSUES. ENFORCEMENT OF
REGULAR EXPORT CONTROLS IS THE RESPONSIBILITY OF THE MINISTRY OF
FINANCE/CUSTOMS AND THE MINISTRY OF INDUSTRY AND TRADE. UNDER JORDANIAN
LAW, THE MINISTRY OF FINANCE/CUSTOMS EXERCISES DIRECT CONTROL ON GOODS
CLEARED TO ENTER AND LEAVE THE KINGDOM. ACCORDING TO THE IMPORT/EXPORT
LAW AND REGULATION, NO EXPORT LICENSE IS REQUIRED FOR JORDANIAN-MADE
PRODUCTS, TRANSIT GOODS, FREE TRADE ZONE GOODS, RE-EXPORTS OR GOODS
ENTERED UNDER TEMPORARY STATUS. HOWEVER, WHILE THE LAW WAS PASSED MORE
THAN SEVEN MONTHS AGO, THE MINISTER OF INDUSTRY AND TRADE HAS NOT ISSUED
THE NECESSARY INSTRUCTIONS TO IMPLEMENT IT. FOR THIS REASON, THE
CUSTOMS DEPARTMENT CONTINUES TO DEMAND AN EXPORT APPLICATION FOR ALL
EXPORTS AND RE-EXPORTS FROM JORDAN. PAPERWORK REQUIRED INCLUDES THE
EXPORT APPLICATION, THE EXPORT DECLARATION STATEMENT AND ALL OTHER
COMMERCIAL DOCUMENTS, INCLUDING A DETAILED CUSTOMS DECLARATION.
IMPORT/EXPORT DOCUMENTATION
ACCORDING TO ARTICLE 40 OF THE CUSTOMS LAW, EVERY CUSTOMS DECLARATION
MUST INCLUDE AN ATTESTED CERTIFICATE OF ORIGIN ISSUED BY THE CONCERNED
AUTHORITY IN THE AREA OF THE EXPORTER. GENERALLY, THE INVOICE MUST HAVE
AN ATTESTATION FROM THE JORDANIAN DIPLOMATIC MISSION WHERE THE GOODS
ORIGINATED. IF THERE IS NO JORDANIAN CONSULATE NEAR THE EXPORTER, THE
CERTIFICATION OF THE LOCAL CHAMBER OF COMMERCE IS SUFFICIENT, SUBJECT TO
THE APPROVAL OF THE CUSTOMS DEPARTMENT DIRECTOR.
THE BUYING PRICE AND ORIGIN OF THE GOODS MUST BE STATED ON INVOICES AND
ALL OTHER DOCUMENTS, ALONG WITH SHIPPING COSTS AND FREIGHT CHARGES,
INSURANCE AND ALL OTHER EXPENSES. THE CUSTOMS DEPARTMENT MAY ACCEPT AN
INVOICE AND CERTIFICATE OF ORIGIN IN ONE DOCUMENT IF THE REQUIRED
INFORMATION IS PRESENT. THE CUSTOMS DEPARTMENT MAY REQUEST OTHER
DOCUMENTS RELATED TO THE SHIPMENT AS NEEDED. ALL INVOICES SHOULD
DESCRIBE THE IMPORTED GOODS IN ARABIC.
THE LOCAL IMPORTER MUST OBTAIN AN IMPORT LICENSE BEFORE HIS CLEARING
AGENT COMPLETES THE CUSTOMS DECLARATION, WHICH PROVIDES ALL DETAILS
RELATING TO THE VALUE AND TYPE OF GOODS, COUNTRY OF ORIGIN, METHOD OF
SHIPMENT, DETAILS ABOUT THE EXPORTER AND SHIPPER, AND THE LOCAL
CONSIGNEE'S NAME AND ADDRESS. THE IMPORTER, OR HIS CLEARING AGENT,
SHOULD PRESENT A BILL OF LADING WITH THE DECLARATION. THE BILL OF
LADING IS USED BY CUSTOMS TO VERIFY THE OWNERSHIP OF THE GOODS. FOR
GOODS IN TRANSIT THROUGH JORDAN, THE LOCAL IMPORTER, OR HIS CLEARING
AGENT, MUST PRESENT A CUSTOMS DECLARATION ISSUED BY A NEIGHBORING
COUNTRY.
IMPORTING MANY PRODUCTS, SUCH AS FOODSTUFFS, AGRICULTURAL AND ANIMAL
PRODUCTS, SATELLITE DISHES AND TELEPHONE EQUIPMENT, REQUIRE A SPECIAL
PERMIT BEFORE THE CUSTOMS DEPARTMENT WILL GIVE ITS CLEARANCE. THE
PERMIT IS ISSUED BY THE RESPONSIBLE JORDANIAN MINISTRY OR AGENCY. FOR
EXAMPLE, THE TELECOMMUNICATIONS CORPORATION (TCC) ISSUES PERMITS FOR
IMPORTING SATELLITE DISHES AND TELEPHONE EQUIPMENT, THE CIVIL DEFENSE
DEPARTMENT IS RESPONSIBLE FOR FIRE-FIGHTING EQUIPMENT, AND THE TCC AND
SECURITY AGENCIES ISSUES PERMITS FOR ALARM EQUIPMENT EQUIPPED WITH
RADIOWAVE COMPONENTS.
FOR FOODSTUFFS, A LABORATORY REPORT IS REQUIRED. A COMMITTEE AT THE
AQABA AND AMMAN CUSTOMS CENTERS, CALLED "THE SAMPLING COMMITTEE", MUST
AUTHORIZE LABORATORY TESTING. THE COMMITTEE INCLUDES REPRESENTATIVES
FROM THE MINISTRIES OF HEALTH, SUPPLY, AGRICULTURE, AND THE DEPARTMENT
OF STANDARDS AND MEASURES AND CUSTOMS. ACCORDING TO CUSTOMS OFFICERS,
ONLY THE AQABA CUSTOMS LABORATORY IS CAPABLE OF VERIFYING THE TYPE AND
COMPOSITION OF AN IMPORTED PRODUCT SO THAT A CUSTOMS TARIFF NUMBER CAN
BE ASSIGNED, ACCORDING TO THE INTERNATIONAL HARMONIZED CODING SYSTEM.
CERTAIN IMPORTS, SUCH AS PRECIOUS METALS AND REGULAR METALS, CAN ONLY BE
TESTED AT THE AQABA CUSTOMS LABORATORY.
TEMPORARY ENTRY
INSTRUCTIONS COVERING TEMPORARY ENTRY REQUIREMENTS FOR MANUFACTURING AND
EXPORT PURPOSES WERE ISSUED IN MAY 1994, AND STATE THAT:
A) A WRITTEN REQUEST MUST BE SUBMITTED TO THE CUSTOMS DEPARTMENT FOR
THE TEMPORARY ENTRY OF RAW MATERIALS AND INTERMEDIATE GOODS
NECESSARY TO MANUFACTURE PRODUCTS DESTINED FOR EITHER THE LOCAL
MARKET OR FOR EXPORT;
B) LOCAL FACTORIES REGISTERED WITH THE MINISTRY OF INDUSTRY AND TRADE
AND THE AMMAN CHAMBER OF INDUSTRY MAY APPLY FOR TEMPORARY ENTRY
APPROVAL;
C) THE PERIOD OF TEMPORARY ENTRY IS GRANTED FOR ONE YEAR, RENEWABLE FOR
ANOTHER YEAR PENDING APPROVAL AND EVALUATION BY CUSTOMS, AND;
D) THE MANUFACTURER MUST SUBMIT A BANK GUARANTEE EQUAL TO THE VALUE OF
ALL TARIFFS, DUTIES AND FEES ON THE MATERIALS CLEARED FOR ENTRY.
LABELING, MARKING REQUIREMENTS
LOCAL BUSINESSMEN MAY ONLY IMPORT PRODUCTS WHICH COMPLY WITH THE
LABELING AND MARKING REQUIREMENTS ISSUED BY THE DEPARTMENT OF STANDARDS
AND MEASURES AND RESPONSIBLE GOVERNMENT MINISTRIES. DIFFERENT
REQUIREMENTS GOVERN THE IMPORTS OF FOODSTUFFS, MEDICINES, CHEMICALS AND
OTHER CONSUMER PRODUCTS. JORDANIAN IMPORTERS ARE RESPONSIBLE FOR
INFORMING EXPORTERS OF ANY APPLICABLE LABELING AND MARKING REQUIREMENTS.
PROHIBITED IMPORTS
THE MINISTRY OF SUPPLY BANS IMPORTS OF THE FOLLOWING GOODS INTO JORDAN:
WHEAT SEMOLINA, TABLE SALT, VEGETABLE OIL/HYDRATED PALM OIL, EGGS, OLIVE
OIL AND BOTTLED OLIVES, ARABIC-STYLE SWEETS, BREAD AND ICE CREAM.
HOWEVER, THE MINISTRY MAY GRANT PERMISSION FOR THE PRIVATE SECTOR TO
EXPORT THESE PRODUCTS.
STANDARDS (ISO 9000 USAGE)
THE JORDANIAN STANDARDS AND MEASURES DEPARTMENT IS RESPONSIBLE FOR
VERIFYING THAT IMPORTED GOODS COMPLY WITH JORDANIAN-ISSUED STANDARDS.
UNTIL THE END OF 1993, THE DEPARTMENT ISSUED 960 STANDARDS BROKEN DOWN
INTO THE FOLLOWING CATEGORIES: FOODSTUFFS, 278; CHEMICALS, 289;
CONSTRUCTION MATERIALS, 103; TEXTILES AND PAPER, 109; AND ENGINEERING
AND METEOROLOGY, 181. THE DEPARTMENT WILL BECOME AN INDEPENDENT,
AUTONOMOUS GOVERNMENT CORPORATION BEFORE THE END OF 1994 AND MAY MOVE
FORWARD IN IMPLEMENTING THE ISO 9000 QUALITY-MARK STANDARDS. THE ROYAL
SCIENTIFIC SOCIETY, A GOVERNMENT AGENCY, CARRIES OUT LABORATORY TESTING
AND PRODUCT ANALYSIS TO VERIFY COMPLIANCE WITH LOCAL STANDARDS. FREE
TRADE ZONES/WAREHOUSES
GOODS MAY BE SHIPPED TO THE JORDANIAN FREE TRADE ZONES BY SHIPPING
AGENTS AND REPRESENTATIVES OF LAND TRANSPORT AND CLEARING FIRMS. ALL
SHIPPING DOCUMENTATION MUST BE SUBMITTED TO THE FREE ZONES WITHIN 72
HOURS AND BEFORE SHIPMENTS ARE UNLOADED. JORDANIAN AND FOREIGN
INVESTORS ARE PERMITTED EQUALLY TO INVEST IN TRADE, SERVICES, OR STORAGE
FACILITIES IN THE FREE ZONES.
TRANSIT GOODS ENTERING THE KINGDOM MAY BE STORED IN WAREHOUSES AT THE
PORT OF AQABA FOR UP TO ONE MONTH; BEYOND THAT, THEY MUST BE STORED IN
A FREE ZONE. THE FREE ZONES INVESTMENT REGULATION NO. 43 OF 1987
PERMITS THE ENTERING, DEPOSITING AND EXPORTING OF ANY TYPE OF FOREIGN
GOODS FROM ANY ORIGIN WITHOUT AN IMPORT OR EXPORT LICENSE. HOWEVER,
ENTRY OF THE FOLLOWING GOODS IS PROHIBITED:
A) GOODS ORIGINATING FROM COUNTRIES WITH WHICH TRADING IS BANNED;
B) DRUGS, EXCEPT WHAT IS REQUIRED BY THE LOCAL PHARMACEUTICAL INDUSTRY,
AS DETERMINED BY THE MINISTRY OF HEALTH;
C) ARMS, MUNITIONS AND EXPLOSIVES, EXCEPT WHAT IS USED IN HUNTING, AS
DETERMINED BY THE SECURITY DEPARTMENTS;
D) ROTTEN OR FLAMMABLE GOODS, AS DEFINED BY THE BOARD OF DIRECTORS OF
THE FREE ZONES CORPORATION; AND,
E) RADIOACTIVE MATERIALS, EXCEPT WHAT IS PERMISSIBLE BY THE MINISTER OF
ENERGY AND MINERAL RESOURCES.
SPECIAL IMPORT PROVISIONS
THE MINISTRY OF SUPPLY HAS A MONOPOLY OVER THE IMPORT OF THE FOLLOWING
FOOD PRODUCTS: SUGAR, RICE, LENTILS, WHEAT, CIGARETTES, FROZEN
CHICKENS, OLIVE OIL, WHEAT FLOUR, HALIBUNA MILK AND COMPLETE FROZEN
LAMBS. THE MINISTRY MUST GRANT PERMISSION FOR IMPORTING AND EXPORTING
THE FOLLOWING PRODUCTS: LIGHT AND DARK BROWN SUGAR IN CONTAINERS OF NOT
MORE THAN 500 GRAMS, SUGAR FOR PHARMACEUTICAL MANUFACTURING, COOKIES,
TEA, MACARONI, NOODLES, ANIMAL FODDER (BARLEY, BROKEN WHEAT ARTICLES AND
YELLOW CORN), BARLEY WHEAT FOR BREAD, YEAST, BUTTER, ANIMAL GHEE, HALAWA
TAHINA, YELLOW CHEESE, VEGETABLE OIL, FRESH OR FROZEN LAMB AND VEAL,
LIVESTOCK IMPORTED FOR FARMING OR SLAUGHTERING, CANNED MEAT, FISH,
MORTADELLA (COLD CUTS) OF ALL TYPES, EDIBLE CEREALS (CHICK PEAS AND
BRUISED AND CRUSHED WHEAT), ALL COW AND SHEEP PRODUCTS, ALL FLOUR
DERIVATIVES, CANNED POWDERED MILK, CANNED AERATED WATER, LONG-GRAIN
RICE, AND YOGURT.
MEMBERSHIP IN FREE TRADE ARRANGEMENTS
JORDAN IS NOT A MEMBER IN ANY REGIONAL OR INTERNATIONAL FREE TRADE
ARRANGEMENT. IT RECENTLY APPLIED FOR MEMBERSHIP IN THE GENERAL
AGREEMENT OF TARIFFS AND TRADE (GATT).
CHAPTER VII. INVESTMENT CLIMATE STATEMENT
OPENNESS TO FOREIGN INVESTMENT
THE GOVERNMENT OF JORDAN (GOJ) OFFICIALLY ENCOURAGES FOREIGN AND PRIVATE
INVESTMENT, YET BARRIERS TO INVESTMENT EXIST. SOME OF THE MAIN BARRIERS
INCLUDE THE INEFFECTIVE ENFORCEMENT OF INTELLECTUAL PROPERTY RIGHTS,
THOUGH JORDAN PLANS TO JOIN THE BERNE CONVENTION BY 1996. THE
ENCOURAGEMENT OF INVESTMENT LAW NO. 11 OF 1987 AND THE FOREIGN
INVESTMENTS LAW NO. 27 OF 1992 HAVE TRADITIONALLY BEEN CONSIDERED
OBSTACLES TO INVESTMENT. HOWEVER, THE DRAFT INVESTMENT LAW OF 1995,
WHICH SHOULD BECOME LAW BY THE FALL OF 1995, WILL INTEGRATE THE TWO
LAWS, REMOVE MOST OBSTACLES AND PROMOTE INVESTMENT THROUGH THE
ESTABLISHMENT OF AN INVESTMENT PROMOTION COUNCIL. ANOTHER BARRIER IS THE
LAW WHICH REQUIRES 51 PERCENT JORDANIAN OWNERSHIP IN ANY BUSINESS ENTITY
IN TRADE, TRANSPORTATION AND SERVICE SECTORS.
UNDER THE ENCOURAGEMENT OF INVESTMENT LAW, AN INVESTMENT MEETING THE
DEFINITION OF AN "ECONOMIC PROJECT" OR AN "APPROVED ECONOMIC PROJECT"
QUALIFIES FOR TAX HOLIDAYS AND OTHER EXEMPTIONS FOR UP TO FIVE YEARS.
PROFITS ACCRUING TO REGISTERED FOREIGN INVESTMENT COMPANIES, WHICH HAVE
BEEN EXAMINED BY THE INVESTMENT COMMITTEES, MAY BE FREELY REMITTED
BEGINNING TWO YEARS FROM THE DATE OF PRODUCTION.
THE FOREIGN INVESTMENT LAW MAKES A DISTINCTION BETWEEN ARAB AND NON-ARAB
FOREIGN INVESTMENTS IT PERMITS AN ARAB TO INVEST IN ANY PROJECT IN
INDUSTRY, TOURISM, HEALTH, AGRICULTURE, AND HOUSING, PROVIDED THAT HIS
INVESTMENT, SHARE OR CONTRIBUTION IS AT LEAST JD 30,000. AN ARAB
INVESTOR SATISFYING THESE REQUIREMENTS IS TREATED AS A JORDANIAN
INVESTOR.
FOREIGN (NON-ARAB) INVESTORS ARE NOT PERMITTED TO INVEST IN ANY OF THE
ABOVE-MENTIONED SECTORS UNLESS THE MINISTER OF INDUSTRY AND TRADE
RECOMMENDS THE PROJECT AND THE COUNCIL OF MINISTERS GIVES ITS APPROVAL.
THE FOREIGN (NON-ARAB) INVESTOR'S CAPITAL, SHARE OR CONTRIBUTION SHOULD
BE AT LEAST JD 50,000. ARABS OR NON-ARABS MAY INVEST IN TRADE,
CONTRACTING, AND TRANSPORT BUSINESS WITH A JORDANIAN PARTNER PROVIDED
THAT THE ARAB OR FOREIGN INVESTOR'S SHARE IN THE PROJECT IS AT LEAST JD
100,000 IN TRANSPORT OR JD 200,000 IN TRADE OR CONTRACTING, AND THAT IT
DOES NOT EXCEED 49 PERCENT OF THE CAPITAL INVESTED IN THE PROJECT.
BEFORE INITIATING AN INVESTMENT, A FOREIGNER MUST TRANSFER HIS CAPITAL
INTO JORDAN IN A CONVERTIBLE FOREIGN CURRENCY. IN ADDITION, ARAB
NATIONALS MAY BUY SHARES OF PUBLIC SHAREHOLDING COMPANIES LISTED ON THE
AMMAN FINANCIAL MARKET IN ANY CONVERTIBLE CURRENCY OR IN JORDANIAN
DINARS. THE LAW IS NOW BEING INTERPRETED TO THE EFFECT THAT NON-ARAB
INVESTORS REQUIRE CABINET APPROVAL BEFORE THEY CAN PURCHASE SHARES ON
THE FINANCIAL MARKET.
THE GOVERNMENT OF JORDAN RECOGNIZES THE LIMITATIONS OF BOTH INVESTMENT
LAWS. THE ENCOURAGEMENT OF INVESTMENT LAW ESTABLISHES A BUREAUCRATIC
REGIME THAT IS GIVEN ONLY VAGUE GUIDELINES IN DETERMINING WHAT
CONSTITUTES AN ECONOMIC OR AN APPROVED ECONOMIC PROJECT. IN ADDITION,
THE TAX EXEMPTION PROVISIONS ENCOURAGE SHORTER RATHER THAN LONGER TERM
INVESTMENT. THE FOREIGN INVESTMENT LAW RESTRICTS ANYTHING BUT ARAB
DIRECT INVESTMENT. THE GOVERNMENT IS CURRENTLY STUDYING WAYS TO AMEND
BOTH LAWS.
CONVERSION AND TRANSFER POLICIES
IN MARCH 1995, THE CENTRAL BANK OF JORDAN ANNOUNCED THAT THE JORDANIAN
DINAR IS FULLY CONVERTIBLE FOR COMMERCIAL TRANSACTION PURPOSES. THIS
MEASURE IS PART OF GOJ'S EFFORTS TO LIBERALIZE THE INVESTMENT CLIMATE.
THERE ARE NO RESTRICTIONS ON TRANSFERRING FUNDS ASSOCIATED WITH
INVESTMENT. TRANSFERS WITHIN THE JORDANIAN BANKING SYSTEM ARE PERMITTED
IN ANY MAJOR WORLD CURRENCY AT THE LEGAL MARKET CLEARING RATE, WHICH IS
THE CENTRAL BANK OF JORDAN'S (CBJ) OFFICIAL RATE. CBJ REGULATIONS
PERMIT NON-RESIDENTS AND FOREIGN INVESTORS WHO TRANSFERRED THEIR FUNDS
INTO THE KINGDOM TO REMIT THEIR FUNDS ABROAD IN THE SAME OR ANY OTHER
TRANSFERABLE CURRENCY.
TO TRANSFER FUNDS OUTSIDE JORDAN, A LOCAL BANK MUST OBTAIN A FOREIGN
CURRENCY TRANSFER PERMIT FROM THE CBJ. FURTHERMORE, THE CBJ MUST BE
INFORMED WHEN AN INVESTOR TRANSFERS FUNDS INTO THE KINGDOM, OPENS A NON-
RESIDENT ACCOUNT AT A LOCAL BANK OR SEEKS TO TRANSFER FOREIGN CURRENCY
FUNDS OUTSIDE JORDAN BEFORE AN INVESTMENT HAS BEEN MADE. CBJ APPROVAL
FOR THESE TRANSACTIONS IS GENERALLY GRANTED ON THE SPOT.
FOREIGNERS CAN GET CLEAR REGULATIONS GOVERNING THEIR SPECIFIC NEEDS FROM
THE CBJ OR A LOCAL BANK BEFORE INVESTING IN JORDAN. THERE ARE NO
LIMITATIONS ON THE INFLOW OR OUTFLOW OF FUNDS FOR REMITTANCES OF
PROFITS, DEBT SERVICE, CAPITAL GAINS, RETURNS ON INTELLECTUAL PROPERTY
OR IMPORTED INPUTS, AS LONG AS AUTHORIZATION FROM THE CBJ IS OBTAINED
FIRST.
EXPROPRIATION AND COMPENSATION
THERE HAVE BEEN NO CASES IN JORDAN WHERE THE GOVERNMENT HAS EXPROPRIATED
THE PRIVATE PROPERTY OF AN INVESTOR. EMBASSY BELIEVES IT UNLIKELY THAT
THE GOVERNMENT'S POLICIES REGARDING EXPROPRIATIONS WILL CHANGE IN THE
NEAR FUTURE.
DISPUTE SETTLEMENT
THE JORDANIAN GOVERNMENT HAS NOT BEEN A PARTY TO INVESTMENT DISPUTES
WITH FOREIGNERS IN RECENT YEARS. THE COURT SYSTEM IS USED TO ENFORCE
JORDANIAN LAWS AND REGULATIONS REGARDING PROPERTY AND CONTRACTUAL
RIGHTS. EMBASSY HAS RECEIVED NO COMPLAINTS ABOUT JUDICIAL APPLICATION
OF JORDAN'S COMMERCIAL CODE OR OF GOVERNMENT INTERFERENCE IN COMMERCIAL
CASES; MOST COMPLAINTS CONCERN THE EXCESSIVE TIME IT TAKES FOR A CASE TO
GO TO COURT. JORDANIAN COURTS ENFORCE INTERNATIONAL ARBITRATION
DECISIONS ON INVESTMENT DISPUTES BETWEEN FOREIGN INVESTORS AND THE STATE
ONLY IF THE CASE HAD PREVIOUSLY BEEN REGISTERED WITH ANOTHER COURT.
JORDAN IS NOT A MEMBER OF THE INTERNATIONAL CENTER FOR THE SETTLEMENT OF
INVESTMENT DISPUTES.
PERFORMANCE REQUIREMENTS/INCENTIVES
FOR INVESTMENTS THAT FALL UNDER THE ENCOURAGEMENT OF INVESTMENT LAW,
INVESTORS ARE REQUIRED TO SUBMIT TO THE MINISTER OF INDUSTRY AND TRADE
SEMI-ANNUAL REPORTS ON THE PROGRESS OF THEIR PROJECTS DURING THE YEARS
OF TAX EXEMPTION. THE MINISTER STIPULATES THE STANDARDS FOR DEVELOPING
SUCH PROJECTS, PLUS THE DATE OF PRODUCTION START-UP. IN THE CASE OF
IMPORTED RAW MATERIALS, WHICH RECEIVE TAX EXEMPTIONS UNDER THE LAW,
INVESTORS MUST DOCUMENT THE VALUE OF IMPORTS WHICH HAVE BEEN USED OR
INSTALLED AT THE PROJECT.
IN RETURN FOR SATISFYING THESE PERFORMANCE REQUIREMENTS, AN INVESTOR
BENEFITS FROM THE FOLLOWING INCENTIVES OFFERED UNDER THE ENCOURAGEMENT
OF INVESTMENT LAW:
A) EXEMPTION FROM CUSTOMS AND IMPORT DUTIES ON FIXED ASSETS;
B) EXEMPTION FROM INCOME AND SOCIAL SERVICE TAXES ON NET PROFITS FOR
FIVE YEARS FROM THE DATE OF PRODUCTION;
C) EXEMPTION FROM BUILDING AND LAND TAXES FOR FIVE TO SEVEN
YEARS FROM THE DATE OF PROJECT APPROVAL;
D) FREE GRANTS OF STATE-OWNED LAND OUTSIDE THE CITIES OF AMMAN AND
ZARQA AS APPROVED BY THE COUNCIL OF MINISTERS;
E) REPATRIATION OF IMPORTED CAPITAL IN THREE EQUAL ANNUAL INSTALLMENTS
STARTING TWO YEARS AFTER PRODUCTION BEGINS;
F) EXEMPTION FROM INCOME TAXES ON INTEREST AND DIVIDENDS; AND
G) ANNUAL REPATRIATION OF DIVIDENDS.
RIGHT TO PRIVATE OWNERSHIP AND ESTABLISHMENT
IN GENERAL, PREVAILING JORDANIAN LAWS ON INVESTMENTS AND PROPERTY
OWNERSHIP PERMIT DOMESTIC AND FOREIGN ENTITIES TO ESTABLISH AND OWN
BUSINESS ENTERPRISES AND ENGAGE IN REMUNERATIVE ACTIVITIES. HOWEVER,
ACTIVITIES THAT CONCERN THE MILITARY AND NATIONAL SECURITY INTERESTS OF
THE KINGDOM ARE SUBJECT TO DIFFERENT PROVISIONS AND PROCEDURES. FOREIGN
COMPANIES MAY OPEN REGIONAL AND BRANCH OFFICES TO CONDUCT BUSINESS.
UNDER THE REGISTRATION OF FOREIGN COMPANIES LAW, BRANCH OFFICES MAY
CARRY OUT FULL BUSINESS ACTIVITIES IN JORDAN WHILE REGIONAL OFFICES MAY
SERVE AS LIAISONS BETWEEN THEIR HEAD OFFICES AND JORDANIAN OR REGIONAL
CLIENTS.
NO FOREIGN FIRM MAY IMPORT GOODS INTO THE COUNTRY WITHOUT APPOINTING A
REGISTERED AGENT. THE AGENT'S CONNECTION TO THE FOREIGN COMPANY MUST BE
DIRECT, WITHOUT A SUB-AGENT OR INTERMEDIARY IN BETWEEN. THERE ARE NO
REGULATIONS GOVERNING THE CONTRACT BETWEEN THE FOREIGN FIRM AND THE
COMMERCIAL AGENT. PRIVATE FOREIGN ENTITIES THAT ARE REGISTERED,
LICENSED AND PERMITTED TO OPERATE IN JORDAN, WHETHER UNDER SOLE FOREIGN
OWNERSHIP OR AS A JORDANIAN-FOREIGN JOINT VENTURE, COMPETE EQUALLY WITH
LOCAL COMPANIES.
PROTECTION OF PROPERTY RIGHTS
THE JORDANIAN LEGAL SYSTEM FACILITATES AND PROTECTS THE ACQUISITION AND
DISPOSITION OF PROPERTY RIGHTS. HOWEVER, WHILE THE GOJ HAS EXPRESSED
ITS INTENT TO JOIN THE BERNE CONVENTION BY 1996, NO GOVERNMENT MEASURES
HAVE BEEN PUT INTO PLACE TO ENFORCE IPR LAWS IN JORDAN. THE JORDANIAN
COPYRIGHTS LAW, ADOPTED IN 1992, ONLY PROTECTS FOREIGN WORKS THAT ARE
MADE AND REGISTERED IN JORDAN, ARE SUBJECT TO AN INTERNATIONAL AGREEMENT
TO WHICH JORDAN IS A PARTY, OR ARE SUBJECT TO RECIPROCAL PROTECTION.
FOREIGN WORKS MADE ABROAD MUST BE REGISTERED IN JORDAN IN ORDER TO BE
PROTECTED AND RECOGNIZED. THE LAW GIVES THE IPR HOLDER THE EXCLUSIVE
RIGHT TO COPY AND REPRODUCE WORKS; TRANSLATE, REVISE, ADAPT, OR PREPARE
DERIVATIVE WORKS; DISTRIBUTE COPIES OF WORKS; AND PUBLICLY COMMUNICATE
WORKS.
ROYALTIES MAY BE REMITTED UNDER LICENSING AGREEMENTS APPROVED BY THE
MINISTRY OF INDUSTRY AND TRADE. TRADEMARKS AND PATENTS REGISTERED AT
THE MINISTRY OF INDUSTRY AND TRADE, IN ACCORDANCE WITH JORDANIAN LAW NO.
33 OF 1952, ARE PROTECTED FOR A PERIOD OF SEVEN YEARS FROM THE DATE OF
REGISTRATION. REGISTRATION MAY BE RENEWED ONCE, FOR A TOTAL PERIOD OF
14 YEARS. TRADEMARK FEES ARE NOMINAL. A FOREIGN COMPANY MAY HAVE ITS
TRADEMARKS OR PATENTS REGISTERED IN JORDAN BY SENDING A POWER OF
ATTORNEY TO A TRADEMARK AGENT OR TO A LAWYER. IN PRACTICE, LOCAL
BUSINESSMEN HAVE BEEN KNOWN TO REGISTER INTERNATIONALLY-KNOWN TRADEMARKS
WITHOUT THE HOLDERS KNOWLEDGE.
REGULATORY SYSTEM: LAWS AND PROCEDURES
WHILE THE GOVERNMENT HAS ANNOUNCED ITS INTENTION TO STREAMLINE
REGULATORY SYSTEMS, ESPECIALLY THOSE THAT INHIBIT BUSINESS ACTIVITY,
PROGRESS HAS BEEN SLOW. LOCAL BUSINESSMEN FREQUENTLY COMPLAIN ABOUT THE
CUMBERSOME PROCEDURES FOR REGISTERING COMPANIES OR CLEARING GOODS
THROUGH CUSTOMS. THE GOVERNMENT HAS HAD SOME SUCCESSES IN ELIMINATING
UNNECESSARY BUREAUCRACY. IMPORT LICENSING PROCEDURES HAVE BEEN
SIMPLIFIED AND EXPORT LICENSING PROCEDURES HAVE BEEN ELIMINATED. THE
GOVERNMENT IS CURRENTLY LOOKING AT WAYS TO FACILITATE COMPANY
REGISTRATIONS.
IN GENERAL, TAX, LABOR, HEALTH AND SAFETY LAWS DO NOT DISTORT OR IMPEDE
THE EFFICIENT MOBILIZATION AND ALLOCATION OF INVESTMENT. IN LATE 1993,
THE INVESTMENT DIRECTORATE AT THE MINISTRY OF INDUSTRY AND TRADE WAS
ESTABLISHED AS AN INDEPENDENT AGENCY TO SERVE AS A ONE STOP SERVICING
CENTER FOR INVESTORS. THIS AGENCY WILL SEEK TO STREAMLINE FOREIGN
INVESTMENT PROCEDURES AND ELIMINATE BUREAUCRATIC IMPEDIMENTS TO
INVESTMENT.
EFFICIENT CAPITAL MARKETS AND PORTFOLIO INVESTMENT
THE CENTRAL BANK OF JORDAN (CBJ) IS THE ULTIMATE AUTHORITY ON CAPITAL
AND CREDIT MARKETS IN JORDAN. ITS POLICIES ARE AIMED AT FACILITATING
THE FLOW OF FINANCIAL RESOURCES IN AND OUT OF JORDAN. JORDANIAN
CITIZENS ARE PERMITTED TO INVEST IN OTHER ARAB COUNTRIES IN ORDER TO
ENCOURAGE RECIPROCAL TREATMENT.
THE RECESSION IN THE LATE 1980'S EXACERBATED WEAKNESSES WITHIN THE
BANKING SYSTEM, WHICH CULMINATED WITH THE COLLAPSE OF PETRA BANK IN
1989. THE CENTRAL BANK RESPONDED BY REORGANIZING A NUMBER OF OTHER
BANKS AND INSTITUTING STRICT CAPITAL SUFFICIENCY REQUIREMENTS, WHICH
RESTORED THE HEALTH OF THE FINANCIAL SECTOR. FOR THE PAST TWO YEARS,
THE BANKING SYSTEM HAS BEEN ONE OF THE FASTEST GROWING SECTORS OF THE
ECONOMY. TOTAL ASSETS GREW FROM 10.3 BILLION IN 1994 TO 11.6 BILLION IN
1994 . THE TOTAL ASSETS OF THE FIVE LARGEST BANKS ARE ABOUT USD 6.62
BILLION.
THE JORDANIAN BANKING SYSTEM OFFERS ALL TYPES OF BANKING, INVESTMENT AND
PORTFOLIO SERVICES, INVOLVING LOCAL OR INTERNATIONAL ACCOUNTS AND
TRANSACTIONS. FOREIGN FIRMS, AS NON-RESIDENT ACCOUNT HOLDERS, ENJOY
ACCESS TO BANKING CREDIT AND LOANS. THE INTEREST RATE CHARGED ON CREDIT
FACILITIES GRANTED TO FOREIGN FIRMS MAY BE DECIDED ON A CASE-BY-CASE
BASIS AND MAY DIFFER BETWEEN BANKS. HOWEVER, FOREIGN INVESTORS MUST
RECEIVE THE APPROVAL OF THE CBJ BEFORE APPLYING FOR CREDIT LOCALLY.
THERE ARE A NUMBER OF INTERNATIONALLY-RECOGNIZED ACCOUNTING AND AUDITING
FIRMS IN JORDAN. THE GOVERNMENT'S ACCOUNTING AND AUDITING REGULATIONS
ARE CONSISTENT AND INTERNATIONALLY RECOGNIZED.
POLITICAL VIOLENCE
EXCEPT FOR FOOD RIOTS IN MA'AN FOLLOWING THE DEVALUATION OF THE DINAR IN
1988, THERE HAVE BEEN NO POLITICALLY-MOTIVATED DAMAGE TO FOREIGN
INVESTMENT PROJECTS IN JORDAN SINCE THE EARLY 1970'S. THE EMBASSY DOES
NOT ANTICIPATE ANY CIVIL DISTURBANCES IN THE NEAR FUTURE.
BILATERAL INVESTMENT AGREEMENTS: JORDAN HAS NOT ENTERED INTO ANY
BILATERAL INVESTMENT AGREEMENTS.
OPIC AND OTHER INVESTMENT INSURANCE PROGRAMS
OPIC HAS AN INVESTMENT AGREEMENT WITH JORDAN. WHILE THE AGREEMENT
REQUIRES THE JORDANIAN GOVERNMENT TO APPROVE OPIC
INSURANCE FOR CERTAIN TYPES OF INVESTMENTS, THE EMBASSY HAS BEEN
OFFICIALLY INFORMED THAT THE GOVERNMENT CONSIDERS APPROVAL TO BE
AUTOMATIC. JORDAN HAS NEVER SHOWN INTEREST IN JOINING THE MULTILATERAL
INVESTMENT GUARANTEE AGENCY (MIGA).
LABOR
JORDAN HAS ONE OF THE HIGHEST POPULATION GROWTH RATES (3.8 PERCENT
ANNUALLY) IN THE WORLD. ABOUT ONE HALF OF THE POPULATION OF 4.3 MILLION
IS UNDER THE AGE OF 15. JORDAN HAS A LABOR FORCE OF 797,000 AND A
GOVERNMENT ESTIMATED UNEMPLOYMENT RATE OF 20 PERCENT; UNOFFICIAL
ESTIMATES ARE HIGHER. IN GENERAL, THE LABOR FORCE IS WELL EDUCATED.
LITERACY RATES ARE 85 PERCENT FOR MEN AND ABOUT 73 PERCENT FOR WOMEN.
MANY OF THE 300,000 JORDANIANS WHO RETURNED FROM THE GULF STATES AT THE
OUTBREAK OF THE GULF CRISIS HAVE SPECIALIZED SKILLS IN FIELDS SUCH AS
COMPUTER PROGRAMMING AND MARKETING THAT PREVIOUSLY WERE IN SHORT SUPPLY
IN JORDAN. THIS HAS ENHANCED THE ATTRACTIVENESS OF THE KINGDOM AS A
SOURCE OF HIGH-SKILLED LABOR.
TO AVOID AGGRAVATING THE UNEMPLOYMENT PROBLEM, THE GOVERNMENT DOES NOT
PERMIT FOREIGN LABOR TO WORK IN JORDAN, EXCEPT IN EXCEPTIONAL
CIRCUMSTANCES. THE MINISTER OF LABOR MUST APPROVE THE HIRING OF FOREIGN
WORKERS BY PRIVATE BUSINESSES. HOWEVER, THERE ARE CERTAIN SECTORS WHERE
FOREIGN WORKERS PLAY AN IMPORTANT ROLE. NON-JORDANIAN ARAB WORKERS, OF
WHICH EGYPTIANS ARE THE LARGEST SINGLE GROUP, COMMONLY WORK AS LABORERS,
CONSTRUCTION WORKERS, FARM WORKERS, AND IN SERVICE JOBS. ASIAN WORKERS
SUCH AS FILIPINOS AND SRI LANKANS, COMMONLY WORK AS DOMESTICS AND IN
SERVICE INDUSTRIES INCLUDING FOOD AND HEALTH SERVICES.
LABOR UNIONS EXIST IN JORDAN BUT SERVE PRIMARILY AS INTERMEDIARIES
BETWEEN WORKERS AND THE MINISTRY OF LABOR. ALTHOUGH UNIONS MAY ENGAGE
IN COLLECTIVE BARGAINING ON BEHALF OF WORKERS, THEY CANNOT ORGANIZE
DEMONSTRATIONS WITHOUT A PERMIT. CURRENTLY, LESS THAN 15 PERCENT OF THE
TOTAL LABOR FORCE IS UNIONIZED.
THE GOVERNMENT MANDATES WORKER BENEFITS FOR MANY INDUSTRIES AND
BUSINESSES. WAGE LEVELS ARE NOT MANDATED, ALTHOUGH THE GOVERNMENT
RETAINS THE RIGHT TO SET WAGES FOR SPECIFIC SKILLS OR REGIONS. OVERTIME
IS SET AT 125 PERCENT OF WAGES, MINIMUM ANNUAL LEAVE IS 14 DAYS AND
THERE ARE APPROXIMATELY 20 PAID PUBLIC HOLIDAYS. SOCIAL SECURITY
REGULATIONS REQUIRE EMPLOYERS PAY 10 PERCENT AND EMPLOYEES 5 PERCENT OF
WAGES INTO THE SOCIAL SECURITY FUND.
BOTH POLITICAL AND LABOR LEADERS RESPONSIBLE FOR JORDAN'S LABOR SECTOR
AGREE THAT THEIR TOP PRIORITIES ARE REDUCING UNEMPLOYMENT AND CREATING
JOBS. THE GOVERNMENT IS NOW PURSUING MEANS SUCH AS PASSING A NEW SOCIAL
SECURITY LAW, EXPANDING VOCATIONAL TRAINING, AND IMPLEMENTING ECONOMIC
REFORMS IN ORDER TO ALLEVIATE THE SITUATION. THE JORDANIAN PARLIAMENT IS
CURRENTLY CONSIDERING A NEW DRAFT LABOR LAW, WHICH WILL MANDATE FURTHER
BENEFITS FOR WORKERS. PROVISIONS CONSIDERED FOR INCLUSION ARE
PROTECTION FOR WORKERS FROM ARBITRARY OR POLITICALLY MOTIVATED
DISMISSALS, THE ESTABLISHMENT OF A MINIMUM WAGE, MATERNITY LEAVE FOR
WOMEN, AND REFORMS TO THE SOCIAL SECURITY SYSTEM
FOREIGN TRADE ZONES/FREE PORTS
JORDAN'S FREE ZONES CORPORATION HAS DEVELOPED TWO TRADE AND INDUSTRIAL
ZONES NEAR AQABA AND ZARQA, WHICH OFFER FOREIGN INVESTORS SUBSTANTIAL
FINANCIAL INCENTIVES, INCLUDING DUTY-FREE IMPORTATION, TAX RELIEF, AND
GUARANTEED REPATRIATION OF FOREIGN EXCHANGE. ALTHOUGH THE AQABA FREE
ZONE OFFERS FACILITIES FOR INDUSTRIAL MANUFACTURING, ITS ACTIVITIES
CONCENTRATE ON TRANSIT, COLD STORAGE, AND WAREHOUSING. THE ZARQA ZONE
OFFERS AUTOMOBILE AND COMMERCIAL SALES OPPORTUNITIES, PLUS MANUFACTURING
AND WAREHOUSING.
THE FREE ZONE FACILITIES ARE AVAILABLE TO LOCAL JORDANIAN COMPANIES,
JOINT VENTURES, AND REGIONAL OFFICES OF FOREIGN FIRMS. TENANTS ENJOY
SIX PRINCIPAL BENEFITS:
1. EXEMPTION FROM INCOME AND SOCIAL SECURITY TAXES FOR TWELVE YEARS,
EXCEPT FOR PROFITS REALIZED FROM THE COMMERCIAL STORAGE OF GOODS
RELEASED FOR DOMESTIC CONSUMPTION;
2. EXEMPTION FROM INCOME AND SOCIAL SECURITY TAXES ON SALARIES AND
ALLOWANCES EARNED BY NON-JORDANIANS WORKING IN FREE ZONE VENTURES;
3. EXEMPTION FROM IMPORT AND CUSTOM DUTIES, AS WELL AS OTHER TAXES AND
FEES, ON GOODS IMPORTED TO OR RE-EXPORTED FROM THE ZONES, EXCEPT FOR
SERVICE DUES AND WAGES;
4. EXEMPTION FROM REAL ESTATE TAXES AND LICENSE FEES ON BUILDINGS
PROPERTY ERECTED IN THE ZONES;
5. GUARANTEE OF FULL REPATRIATION OF FOREIGN EXCHANGE INVESTED IN AND
PROFITS EARNED FROM FREE ZONE VENTURES; AND
6. EXEMPTION FROM CUSTOMS FEES OF INDUSTRIAL PROJECTS THAT WILL SUPPLY
THE DOMESTIC MARKET.
IMPORTERS USING THE FREE ZONES TO SUPPLY THE LOCAL MARKET AVOID IMPORT
LICENSE FEES AMOUNTING TO FIVE PERCENT OF CARGO VALUE UNTIL THE GOODS
ARE ACTUALLY CLEARED FOR RELEASE FROM THE ZONE. SIMILARLY, IMPORTERS
MAY SIMPLY ISSUE INVOICES TO PURCHASERS WHO THEN ASSUME RESPONSIBILITY
FOR CLEARING THEIR GOODS; IMPORTERS THEREBY AVOID TYING UP LARGE SUMS OF
CASH FOR EXTENDED PERIODS.
CAPITAL OUTFLOW POLICY:
PRIVATE INDIVIDUAL CAPITAL OUTFLOWS ARE RESTRICTED BY LAW. CENTRAL BAND
OF JORDAN REGULATIONS ISSUED IN 1988 PROVIDE THAT:
A) ANY PERSON LEAVING THE KINGDOM MAY TAKE UP TO JD 5,000 IN CASH OUT
OF THE COUNTRY;
B) A PERSON HOLDING A RESIDENT ACCOUNT IN DINARS MAY NOT DRAW ON IT IN
FAVOR OF A PERSON OUTSIDE THE KINGDOM, UNLESS GIVEN APPROVAL BY
THE CBJ;
C) A PERSON RESIDING IN THE KINGDOM MAY NOT OPEN A DINAR ACCOUNT
OVERSEAS, UNLESS GRANTED APPROVAL BY THE CBJ;
D) A PERSON DEPARTING THE KINGDOM MAY TAKE, OR TRANSFER ANNUALLY, UP TO
JD 35,000 IN FOREIGN CURRENCY FOR STUDYING, MEDICAL TREATMENT,
FAMILY REMITTANCE, TRAVEL OR PILGRIMAGE PURPOSES;
E) A PERSON RESIDING IN THE KINGDOM MAY NOT MAINTAIN FOREIGN CURRENCY
ACCOUNTS OVERSEAS, EXCEPT FOR BANKS AND FINANCIAL COMPANIES;
F) A BANK OR FINANCIAL COMPANY MAY EXPORT FOREIGN CURRENCY, PROVIDED
THAT CBJ APPROVAL IS OBTAINED BEFOREHAND;
G) A BANK OR FINANCIAL COMPANY MAY OPEN FOREIGN CURRENCY ACCOUNTS WITH
BRANCHES OR CORRESPONDENT BANKS OVERSEAS, PROVIDED THAT THE CBJ IS
KEPT INFORMED OF THESE RELATIONSHIPS. THE CBJ MAINTAINS THE RIGHT
TO OBJECT TO A RELATIONSHIP WITH ANY CORRESPONDENT BANK;
H) RESIDENT JORDANIANS ARE ALLOWED TO OPEN FOREIGN CURRENCY ACCOUNTS OF
UP TO JD 500,000 PER YEAR;
I) BANKS AND FINANCIAL COMPANIES MUST OBTAIN CBJ APPROVAL IN ORDER TO
ISSUE FOREIGN CURRENCY TRANSFER PERMITS FOR IMPORT LICENSES FROM THE
MINISTRY OF INDUSTRY AND TRADE; AND
J) PURCHASING FOREIGN BANKNOTES FROM THE JORDANIAN BANKING SYSTEM TO
PAY FOR GOODS IMPORTED TO THE FREE ZONES IS PROHIBITED.
CHAPTER VIII. TRADE AND PROJECT FINANCING
BRIEF DESCRIPTION OF BANKING SYSTEM
THE CENTRAL BANK OF JORDAN (CBJ) IS THE KINGDOM'S MONETARY AUTHORITY AND
CONTROLS AND REGULATES BANKING OPERATIONS. IT HAS LICENSED 15
COMMERCIAL BANKS AND SIX INVESTMENT BANKS TO OPERATE IN JORDAN. IN
ADDITION TO REGULAR DEPOSIT AND LENDING ACTIVITIES, JORDANIAN BANKS DEAL
IN DINAR AND DOLLAR-DENOMINATED CERTIFICATES OF DEPOSITS AND FOREIGN
CURRENCY INVESTMENT PORTFOLIOS. THEY ALSO ENGAGE IN CONSORTIUM-LENDING
TRANSACTIONS. MONEYCHANGERS ALSO OPERATE LEGALLY IN JORDAN AND ARE
REGULATED BY THE CBJ.
FOREIGN EXCHANGE CONTROLS AFFECTING TRADING
THE FOREIGN EXCHANGE LAW NO. 95 OF 1966 AND ITS REGULATIONS PROVIDE
RULES RELATED TO COMMERCIAL PAYMENTS, PAYMENTS FOR GOODS ENTERING THE
FREE TRADE ZONES IN TRANSIT, EXPORT TRANSACTIONS AND CAPITAL TRANSFERS.
ACCORDING TO THE REGULATIONS:
A) ALL TRANSFERS OF FUNDS OUTSIDE THE KINGDOM REPRESENTING PAYMENT FOR
IMPORTED GOODS MUST GO THROUGH THE JORDANIAN BANKING SYSTEM;
B) A FOREIGN EXCHANGE PERMIT MUST BE ISSUED BY A LOCAL BANK AFTER THE
IMPORTER HAS OBTAINED AN IMPORT LICENSE FROM THE MINISTRY OF
INDUSTRY AND TRADE;
C) ALL LOCAL BANKS MUST FOLLOW THE INSTRUCTIONS STATED ON THE IMPORT
LICENSE BEFORE OPENING A LETTER OF CREDIT OR ACCEPT BILLS OF LADING
RELATED TO IMPORTED GOODS;
D) TRANSFERS OUTSIDE THE KINGDOM TO SETTLE PAYMENT OF GOODS IMPORTED TO
THE FREE ZONES OR GOODS PASSING IN TRANSIT ARE NOT PERMITTED, UNLESS
TRANSACTED THROUGH BANKS AND FINANCIAL COMPANIES; AND
E) THE PURCHASE OF FOREIGN BANKNOTES FROM THE JORDANIAN BANKING SYSTEM
TO PAY FOR GOODS IMPORTED TO THE FREE ZONES IS NOT PERMITTED.
IN JANUARY 1994 THE CBJ ANNOUNCED THAT RESIDENTS OF JORDAN WOULD BE
PERMITTED TO TRANSFER OUT OF THE COUNTRY 35,000 DINARS IN FOREIGN
CURRENCY FOR TRAVEL, EDUCATION, MEDICAL TREATMENT, LIVING OVERSEAS,
RELIGIOUS PILGRIMAGES AND FAMILY ALLOWANCES. BANKS COULD EXECUTE THESE
TRANSFERS WITHOUT PRIOR PERMISSION FROM THE CBJ. BANKS AND FINANCIAL
COMPANIES MAYOPEN NON-RESIDENT ACCOUNTS IN FOREIGN CURRENCY, FROM WHICH
THEY CAN EXECUTE WITHDRAWAL AND TRANSFER ORDERS WITHOUT ANY CONDITIONS
OR RESTRICTIONS. THE JANUARY INSTRUCTIONS ALSO PERMIT LOCAL BANKS TO
OFFER FOREIGN CURRENCY LOANS AFTER OBTAINING PERMISSION FROM THE CBJ.
GENERAL FINANCING AVAILABILITY
FINANCING IN JORDAN IS AVAILABLE THROUGH OVERDRAFTS, ONE-YEAR DISCOUNTED
LOANS, THREE-YEAR LOANS WITH INTEREST PAYABLE MONTHLY, AND SYNDICATED
LOANS FOR PERIODS OF ONE TO SEVEN YEARS (INTEREST IS BASED ON A THREE-
OR SIX-MONTH BASE RATE PLUS A MARGIN). GOVERNMENT-GUARANTEED DEBT
SECURITIES ARE AVAILABLE TO FINANCE PUBLIC SECTOR PROJECTS.
HOW TO FINANCE EXPORTS/METHODS OF PAYMENT
JORDANIAN EXPORTS ARE FINANCED THROUGH LETTERS OF CREDIT (L/C'S) AND
LETTERS OF GUARANTEE (L/G'S). FINANCING PERIODS RANGE FROM 90-360 DAYS
AGAINST L/C'S ISSUED BY INTERNATIONALLY-RECOGNIZED BANKS, OR AGAINST
EXPORT CONTRACTS BACKED BY PRIME BANKS ACCEPTANCES OF 180-360 DAYS
TENOR. PRE-EXPORT FINANCING IS AVAILABLE FOR 180 DAYS AGAINST L/C'S.
ALL CREDITS EXTENDED TO EXPORTERS AGAINST INWARD L/C'S AND L/G'S OR
ACCEPTANCES ARE ELIGIBLE FOR REFINANCING WITH THE CBJ AT PREFERENTIAL
RATES. THE COST FOR EXPORTERS IS PRESENTLY SET AT SIX PERCENT.
THE CBJ MUST APPROVE PROJECT FINANCING EXTENDED TO NON-RESIDENT
OPERATIONS. LOCAL BANKS REQUEST A FOREIGN BANK GUARANTEE BEFORE
FINANCING IS APPROVED. LOCAL COMMERCIAL BANKS ARE PERMITTED TO OFFER
DIRECT ADVANCES FOR WORKING CAPITAL REQUIREMENTS. THEY OFFER SHORT- OR
LONG-TERM PROJECT FINANCING. SYNDICATED FINANCING CAN ALSO BE ARRANGED
FOR LARGE PROJECTS.
TYPES OF AVAILABLE EXPORT FINANCING AND INSURANCE
JORDAN'S EXIM BANK: IN 1994, THE CBJ ENDORSED THE ESTABLISHMENT OF AN
EXPORT/IMPORT BANK WITH A REGISTRATION CAPITAL OF JD 20 MILLION, HALF OF
WHICH IS TO BE INVESTED IN EXPORT PROMOTION. JORDAN'S EXIM BANK IS 20%
PUBLIC SECTOR AND 80% PRIVATE SECTOR OWNED. THE JORDAN EXIM BANK
PROVIDES CREDIT, LOANS, COMMODITY EXPORT FINANCING, LOANS TO FOREIGN
INVESTORS TO ENCOURAGE EXPORTS, EXPORT L/C's AND L/G's,PROMOTES THE BOND
MARKET, ESTABLISHES TIES WITH FINANCIAL INSTITUTIONS OUTSIDE JORDAN
AMONG OTHER SERVICES.
LIST OF BANKS WITH CORRESPONDENT U.S. BANKING ARRANGEMENTS
COMMERCIAL BANKS
ARAB BANKING CORP.(JORDAN):
ABC (NEW YORK)
ANZ GRINDLAYS BANK:
ANZ, BANK OF NEW YORK
BANKERS TRUST COMPANY
CHASE MANHATTAN BANK
CITIBANK NZ
CREDIT LYONNAISE S.A.
LIBERTY BANK & TRUST CO. OF TULSA NA
UBAF (ARAB AMERICAN BANK)
COT MELB, N.Y.
BANK OF JORDAN:
BANK OF NEW YORK
CHEMICAL BANK
CHASE MANHATTAN BANK
BANK OF AMERICA.
JORDAN-GULF BANK:
CHEMICAL BANK
AMERICAN EXPRESS BANK
BANK OF NEW YORK
BANK OF AMERICA.
THE BUSINESS BANK:
AMERICAN EXPRESS BANK LTD.
CHEMICAL BANK, BANK OF NEW YORK
ARAB AMERICAN BANK.
CITIBANK AMMAN
BRITISH BANK OF THE MIDDLE EAST
ARAB BANK LIMITED
JORDAN-KUWAIT BANK
JORDAN NATIONAL BANK
CAIRO-AMMAN BANK
INVESTMENT BANKS
ARAB JORDAN INVESTMENT BANK:
BANKERS TRUST AND CHEMICAL BANKING CORP.
AMMAN BANK OF INVESTMENTS
UNION INVESTMENT AND SAVINGS BANK
JORDAN INVESTMENT AND FINANCE BANK
PHILADELPHIA INVESTMENT BANK
MIDDLE EAST INVESTMENT BANK
ISLAMIC BANKS:
JORDAN ISLAMIC BANK
SPECIALIZED CREDIT BANKS:
JOINT GOVERNMENT-PRIVATE SECTOR OWNERSHIP:
HOUSING BANK
INDUSTRIAL DEVELOPMENT BANK
CO-OPERATIVE ORGANIZATION
GOVERNMENT-OWNED:
CITIES AND VILLAGES DEVELOPMENT BANK
AGRICULTURAL CREDIT CORPORATION
HOUSING CORPORATION
CHAPTER IX. BUSINESS TRAVEL
TRAVEL ADVISORY AND VISAS
U.S. BUSINESSMEN INTERESTED IN VISITING JORDAN ARE ADVISED TO CONTACT
THE STATE DEPARTMENT TO OBTAIN THE LATEST TRAVEL ADVISORY INFORMATION.
VISITING U.S. BUSINESSMEN ARE GRANTED AN ENTRY VISA AT THE AIRPORT FOR A
FEE OF JD 15 (APPROXIMATELY USD 21). THE VISA IS RENEWABLE THROUGH THE
MINISTRY OF INTERIOR'S DEPARTMENT OF FOREIGNERS AND BORDERS CONTROL.
BUSINESSMEN CARRYING SAMPLES OR CATALOGS MUST DECLARE THEM AT THE
BORDERS AS "SAMPLES OF NO COMMERCIAL VALUE." SINCE JANUARY 1993,
JORDANIAN CUSTOMS HAVE TAXED SAMPLES AND REFUSED TO GRANT THEM A FREE
TARIFF ENTRY. THESE CASES INVOLVE U.S. BUSINESSMEN VISITING JORDAN.
PERSONAL BELONGINGS ARE PERMITTED AND BUSINESSMEN ARE ASKED TO DECLARE
THEIR EXPENSIVE LUGGAGE AS WELL. JORDANIAN REGULATIONS REQUIRE
INVESTORS AND BUSINESSMEN WHO ARE LICENSED TO DO BUSINESS N JORDAN TO
DECLARE THEIR CURRENCY UPON ENTRY. IN CASES WHERE THE INVESTOR HAS
TRANSFERRED HIS CAPITAL FROM A U.S. BANK TO A JORDANIAN BANK, THE
CUSTOMS OFFICER MUST BE INFORMED UPON ENTRY.
HOLIDAYS
JORDANIAN GOVERNMENT OFFICES ARE CLOSED ON FRIDAYS AND PUBLIC (NATIONAL
AND MUSLIM) HOLIDAYS. PRIVATE FIRMS DO NOT WORK ON FRIDAY. LOCAL BANKS
DO NOT OPERATE ON CHRISTMAS AND NEW YEARS.
BUSINESS INFRASTRUCTURE
THE BUSINESS INFRASTRUCTURE IN JORDAN IS REASONABLY WELL-DEVELOPED IN
BUSINESS SERVICES, MAIL, FAX, TELEX, AND TELEPHONE NETWORKS. HOWEVER,
TELEPHONE LINES FOR NEW BUSINESSES ARE DIFFICULT TO OBTAIN IN CERTAIN
AREAS OF AMMAN. THIS WEAKNESS WILL BE OVERCOME WITH THE INTRODUCTION OF
CELLULAR TELEPHONES IN 1995. BUSINESS OFFICES ARE AVAILABLE IN MAJOR
CITIES. IN THE BUSINESS AREAS OF AMMAN, RENT FOR VACANT OFFICES RANGES
BETWEEN USD 3,000-6,000 PER YEAR. CARE RENTAL FACILITIES ARE AVAILABLE
IN JORDAN. MOST JORDANIAN HOTELS HAVE BUSINESS SERVICE OFFICES FOR
TRAVELING BUSINESSMEN. THE MARRIOTT AND JORDAN INTER-CONTINENTAL HOTELS
OFFER AIRPORT-TO-HOTEL CARE PICK-UP AND ASSISTANCE AT AIRPORT CUSTOMS
CLEARANCE POINTS. ENGLISH IS WIDELY SPOKEN IN JORDAN.
U.S. BUSINESSMEN TRAVELING TO JORDAN ARE ADVISED TO CONTACT THE EMBASSY
ECONOMIC/COMMERCIAL SECTION TO OBTAIN INFORMATION ON THE LOCAL MARKET
AND TRENDS IN THE ECONOMY. THE FEDERATION OF JORDANIAN CHAMBERS OF
COMMERCE, AMMAN CHAMBER OF COMMERCE, AMMAN ASSOCIATION, JORDAN EXPORT
DEVELOPMENT AND COMMERCIAL CENTERS AND COMMERCIAL CENTERS CORPORATION
PROVIDE ASSISTANCE FOR FOREIGN BUSINESSMEN. BUSINESS EXPENSES IN JORDAN
ARE VERY COMPETITIVE WHEN COMPARED AGAINST GULF COUNTRIES.
INTERNATIONALLY-ACCEPTED BUSINESS SERVICES AND FACILITIES CAN BE
ACQUIRED IN JORDAN AT ACCEPTABLE RATES.
JORDAN HAS EXCELLENT AIR CONNECTIONS WITH OTHER MIDDLE EASTERN
COUNTRIES, EUROPE AND ASIA. THE NATIONAL AIRLINE, ROYAL JORDANIAN,
FLIES TO MAJOR CITIES IN THE WORLD. HOUSING, WHILE EXPENSIVE, IS
GENERALLY AVAILABLE AND SUITABLE FOR INTERNATIONAL BUSINESS EXECUTIVES.
U.S. PRODUCTS ARE AVAILABLE AT MAJOR SUPERMARKETS. THE CLIMATE IN
JORDAN IS MEDITERRANEAN, RELATIVELY MILD AND VERY FAVORABLE COMPARED THE
GULF REGION AND NORTH AFRICA.
CHAPTER X: APPENDICES
APPENDIX A: COUNTRY DATA
POPULATION: 4.2 MILLION
POP. GROWTH RATE: 3.8 PERCENT
RELIGION(S):
ISLAM: 94 PERCENT
CHRISTIANITY: 6 PERCENT
GOVERNMENT SYSTEMS: CONSTITUTIONAL MONARCHY
LANGUAGES: OFF. ARABIC
BUS. ENGLISH
WORK WEEK: SATURDAY-THURSDAY
APPENDIX B: DOMESTIC ECONOMY
1994 1995 1996
(IN USD MILLION, EXCEPT WHERE NOTED)
GDP (CURRENT PRICES) 6,186.00 6,804.60 7,244.3
GDP (FIXED PRICES) 3,655.30 3,863.70 4,010.7
GDP GROWTH RATE % (CURRENT PRICES) 10.30 10.00 10.0
GDP GROWTH RATE % (FIXED PRICES) 5.70 6.00 6.0
GDP PER CAPITA ( IN USD) 1,041.60 1,112.60 1,663.4
GDP PER CAPITA (FIXED) 651.50 631.80 923.0
GOVT SPENDING AS % OF GDP 39.10 35.60 41.2
INFLATION (PERCENT) 4.00 5.00 6.0
UNEMPLOYMENT (PERCENT) 20.00 20.00 17.0
FOREIGN EXCHANGE RESERVES 500.00 500.00 650.0
AVG EXCHANGE RATE (USD 1 TO DINAR) 1.45 1.45 1.45
U.S. ECON/MILITARY ASSISTANCE 28.00 12.20 12.4
9.00 7.30 30.0
APPENDIX C: TRADE
TOTAL COUNTRY EXPORTS 1,443.0 1,400.0 1,610.0
(INCLUDES RE-EXPORTS)
TOTAL COUNTRY IMPORTS 3,425.8 3,500.0 4.025.0
U.S. EXPORTS 12.9 14.0 18.0
U.S. IMPORTS 337.8 365.0 420.0
MAJOR JORDANIAN IMPORTS FROM THE UNITED STATES (1993)
(IMPORTS ABOVE USD 3.5 MILLION)
B.T.N. COMMODITY VALUE IN PERCENT
CODE USD MIL OF IMPORTS
------ --------- --------- ----------
10/1 WHEAT 106.4 96.4
88/3 AIRCRAFT PARTS 61.8 50.5
10/5 MAIZE 50.3 99.9
10/3 BARLEY 27.3 27.3
84/23/B EXCAVATING, BORING 15.7 36.2
& EXTRACTING MACHINERY
10/6/B HUSKED RICE 12.0 40.5
84/63/A TRANSMISSION SHAFTS & CRANKS 8.1 20.4
47/1 PULP 6.1 79.2
84/53/A AUTOMATIC DATA PROCESSING 5.8 28.4
MACHINES & UNITS
84/59/A OTHER MACHINERY/MECHANICAL 5.5 8.6
APPLIANCES
90/17 MEDICAL/DENTAL/SURGICAL/ 4.6 17.5
VETERINARY INSTRUMENTS
87/6/B TRACTOR PARTS/ACCESSORIES 4.0 23.3
87/A/A/1 AUTOMOBILE PARTS/ACCESSORIES 3.9 6.7
23/4 OIL CAKE/OTHER RESIDUES 3.8 16.6
24/2/B CIGARETTES 3.6 62.5
87/2/C VAN VEHICLES(DIESEL/OVER 3.8 7.2
2000 KG)
APPENDIX D: INVESTMENT STATISTICS
FOREIGN AND DOMESTIC INVESTMENT IN JORDAN DURING 1994
VOLUME OF INVESTED CAPITAL
MILLIONS OF JORDANIAN DINARS)
DOMESTIC FOREIGN TOTAL
-------- ------- ------
INDUSTRY 112.6 12.0 124.6
TRADE 57.7 5.4 63.1
TOURISM 0.2 0.0 0.2
AGRICULTURE 0.2 0.2 0.4
CONTRACTING 19.1 0.7 19.8
TRANSPORTATION 1.3 0.2 1.5
SERVICES 36.9 2.7 39.6
---------
TOTAL 228.0 21.2 249.2
(SOURCE: MINISTRY OF INDUSTRY & TRADE. PRELIMINARY FIGURES).
NUMBER OF PROJECTS:
DOMESTIC FOREIGN TOTAL
-------- ------- ------
INDUSTRY 1,030 90 1,120
TRADE 5,094 60 5,164
TOURISM 10 0 10
AGRICULTURE 11 4 15
CONTRACTING 327 2 329
TRANSPORTATION 76 2 78
SERVICES 3,190 36 3,226
---------
TOTAL 9,738 204 9,942
(SOURCE: MINISTRY OF INDUSTRY & TRADE. PRELIMINARY FIGURES).
APPENDIX E: U.S. AND COUNTRY CONTACTS
COMMERCIAL SECTION
AMERICAN EMBASSY
GARY A. GRAPPO, ECONOMIC/COMMERCIAL COUNSELOR
UNIT 70200
APO AE O9892-0200
MINISTRY OF INDUSTRY AND TRADE
ALI ABU RAGHEB, MINISTER
P.O. BOX 2019, AMMAN, JORDAN
TELEPHONE: 603721
JORDAN INVESTMENT PROMOTION DEPARTMENT
MR. IYAD AL-QUDAH, DIRECTOR GENERAL
P.O. BOX 893, AMMAN, JORDAN
TELEPHONE: 861081/3
FAX: 861084
JORDAN EXPORT DEVELOPMENT AND COMMERCIAL CENTERS COPR (JEDCO)
DR. MOHAMMED AL-HALIKA, DIRECTOR GENERAL
P.O. BOX 7704, AMMAN, JORDAN
TELEPHONE: 603507
FAX: 684568
JORDAN INDUSTRIAL ESTATES CORPORATION
DR. FAYEZ SUHAIMAT, DIRECTOR GENERAL
P.O. BOX 950278, AMMAN, JORDAN
P.O. BOX 17, SAHAB INDUSTRIAL ESTATE, AMMAN, JORDAN
TELEPHONE: 722101/3
FAX: 723299
FREE ZONES CORPORATION
MR. MUSA AL-JAGHBEER, DIRECTOR GENERAL
P.O. BOX 20036, AMMAN, JORDAN
TELEPHONE: 642001
FAX: 644821
CENTRAL BANK OF JORDAN
DR. MOHAMMED SAID EL-NABULSI, GOVERNOR
P.O. BOX 20036, AMMAN, JORDAN
TELEPHONE: 642001
FAX: 644821
CHAMBER OF COMMERCE AND TRADE ASSOCIATIONS
------------------------------------------
AMMAN CHAMBER OF COMMERCE
MR. HAIDAR MURAD, CHAIRMAN
P.O. BOX 287, AMMAN, JORDAN
TELEPHONE: 666151/3
FAX: 666151
AMMAN CHAMBER OF INDUSTRY
MR. KHALDOUN ABU HASSAN, CHAIRMAN
MR. WALID AL-KHATIB, DIRECTOR GENERAL
P.O. BOX 1800, AMMAN, JORDAN
TELEPHONE: 644569
FAX: 647825
JORDAN TRADE ASSOCIATION
DR. ZIAD FARIZ
MR. HALIM ABU RAHMEH, EXECUTIVE DIRECTOR
P.O. BOX 830432, AMMAN, JORDAN
TELEPHONE: 685603/4
FAX: 685605
JORDANIAN BUSINESSMEN ASSOCIATION
MR. HAMDI TABBA', PRESIDENT
MR. ALI YOUSEF, DIRECTOR GENERAL
P.O. BOX 926182, AMMAN, JORDAN
TELEPHONE: 680855
FAX: 680663
AMMAN WORLD TRADE CENTER
MR. HAIDAR MURAD, PRESIDENT
MR. OSAMA GHANNOUM, GENERAL MANAGER
P.O. BOX 962140, AMMAN, JORDAN
TELEPHONE: 605691/2
FAX: 605793
MARKET RESEARCH FIRMS
---------------------
NOTE: FIRMS REGISTERED AT THE MINISTRY OF INDUSTRY AND TRADE AS MARKET
RESEARCH FIRMS ARE NOT REQUIRED TO COMPLY WITH DEFINED PROFESSIONAL
REQUIREMENTS SET BY THE STATE OR THE PRIVATE SECTOR. EMBASSY SUGGESTS
THAT AMERICAN FIRMS CONTACT THE COMMERCIAL SECTION FOR A LIST OF FIRMS
IN SPECIFIC SECTORS WHICH MAY PROVIDE THIS SERVICE AND SEEK THE
SECTION'S ADVICE BEFORE MAKING A SELECTION.
COUNTRY COMMERCIAL BANKS
------------------------
THE HOUSING BANK
MR. ZUHAIR KHOURI, CHAIRMAN AND GENERAL MANAGER
P.O. BOX 7693, AMMAN, JORDAN
TELEPHONE: 667126/9
FAX: 678121
CITIBANK
MR. WALID ALAMUDDIN, GENERAL MANAGER
P.O. BOX 5055, AMMAN, JORDAN
TELEPHONE: 644065/642276
FAX: 658693
ARAB BANK LIMITED
MR. ABDULMAJEED SHOMAN, CHAIRMAN AND GENERAL MANAGER
P.O. BOX 950545, AMMAN, JORDAN
TELEPHONE: 607115/30
FAX: 606793
CAIRO-AMMAN BANK
MR. KHALIL Y. TALHOUNI, CHAIRMAN
MR. YAZID MUFTI, GENERAL MANAGER
P.O. BOX 715, AMMAN, JORDAN
TELEPHONE: 639321/7
FAX: 639328
ARAB BANKING CORPORATION/JORDAN
MR. ABDUL WAHAB A. AL-TAMMAR, CHAIRMAN
MR. JAWAD AL HADID, GENERAL MANAGER
P.O. BOX 926691, AMMAN, JORDAN
TELEPHONE: 664183/5
FAX: 686291
U.S. EMBASSY ECONOMIC AND COMMERCIAL PERSONNEL
----------------------------------------------
GARY A. GRAPPO, ECONOMIC/COMMERCIAL COUNSELOR
STEVEN BONDY, ECONOMIC/COMMERCIAL OFFICER
DON HEPBURN, COMMERCIAL OFFICER
RASIM S. ABDERRAHIM, ECONOMIC/COMMERCIAL SPECIALIST
MUNA FAKHOUH, COMMERCIAL SPECIALIST
GEORGINA ABU MANNEH, COMMERCIAL ASSISTANT
HALA KHOURY, AGRICULTURAL SPECIALIST
WASHINGTON-BASED USG COUNTRY CONTACTS
-------------------------------------
DEBORAH JONES
DESK OFFICER FOR JORDAN, SYRIA AND LEBANON
NEA/ARN, DEPARTMENT OF STATE
WASHINGTON, DC 20520
TELEPHONE: (202) 647-1058
FAX: (202) 647-0989
PAUL THANOS
JORDAN DESK OFFICER
OFFICE OF THE NEAR EAST
DEPARTMENT OF COMMERCE
WASHINGTON, DC
TELEPHONE: (202) 377-1870
FAX: (202) 377-0878
U.S.-BASED MULTIPLIERS RELEVANT FOR COUNTRY
-------------------------------------------
U.S. ARAB CHAMBER OF COMMERCE
1825 K STREET, N.W.
SUITE 1107
WASHINGTON, DC 20006
TELEPHONE: (202) 331-8010
FAX: (202) 331-8297
APPENDIX F: MARKET RESEARCH
INTERNATIONAL MARKET INSIGHTS (IMI'S)
SCHEDULED IN FY95 AND FY96
A) BEST PROSPECTS FOR EXPORTS OF U.S. COMPUTER AND INFORMATION
TECHNOLOGY TO JORDAN
B) JORDAN'S TELECOMMUNICATIONS SECTOR: MID-TERM PUBLIC-PRIVATE
INVESTMENT OPPORTUNITIES IN JORDANIAN PROJECTS
C) THE FUTURE OF U.S. ENVIRONMENTAL TECHNOLOGY EXPORTS TO
JORDAN'S EMERGING MARKETS
D) JORDAN'S FREE TRADE ZONES AND TRANSIT TRADE
E) NEW DEVELOPMENTS IN JORDAN'S FOREIGN INVESTMENT REGIME
INDUSTRIAL SUB-SECTOR ANALYSES (ISI'S)
SCHEDULED IN FY95 AND FY96
A) TELECOMMUNICATIONS PROJECTS
B) CONSTRUCTION MATERIALS AND SUPPLIES
C) MEDICAL EQUIPMENT AND SUPPLIES
D) ENERGY AND ENVIRONMENTAL PRODUCTS AND TECHNOLOGIES
E) COMPUTER AND INFORMATION TECHNOLOGY SECTOR
F) CONSUMER ELECTRONICS AND ELECTRONIC PARTS
APPENDIX G: TRADE EVENT SCHEDULE
SCHEDULED EVENTS FOR FY 1995 AND FY 1996
OCT 29-31 AMMAN ECONOMIC SUMMIT
FEB 22-24 FOURTH ANNUAL AMERICAN COMPUTER SHOW
APR 20-25 FOURTH ANNUAL AMERICAN PROMOTION WEEK
OTHER EVENTS ORGANIZED BY LOCAL EXHIBITION ORGANIZERS
1995 EVENTS:
AUG 15-18 JORDAN INTERNATIONAL TRADE FAIR AT AMMAN
(GOLDEN JORDANIAN GROUP)
OCT 9-12 MIDDLE EAST AGRICULTURAL, IRRIGATION AND FOOD PROCESSING
(AL MADINA INFORMATION AND BUSINESS)
OCT 9-12 MIDDLE EAST PACKAGING AND PACKING INTERNATIONAL
(AL MADINA INFORMATION AND BUSINESS)
OCT 17-21 THIRD ANNUAL JORDAN INTERNATIONAL TRADE FAIR
(HIKMAT INTERNATIONAL)
OCT 18-22 MIDDLE EAST TECHNOLOGY SHOW
(JORDAN COMPUTER SOCIETY)
OCT 22-26 MIDDLE EAST HEALTH CARE, MEDICAL, DENTISTRY & LABORATORIES
(UNIVERSAL EXHIBITIONS CORP.)
NOV 6-9 MIDDLE EAST BUILDING MATERIAL & CONSTRUCTION
EQUIPMENT INTERNATIONAL (AL MADINA INFORMATION)
NOV 6-9 MIDDLE EAST PROTECTION & SECURITY INTERNATIONAL
(AL MADINA INFORMATION AND BUSINESS)
NOV 27-30 MIDDLE EAST TELECOMMUNICATION EXHIBITION
(MIDDLE EAST EXHIBITION & INT'L TRADE CO.)
DEC 4-7 MIDDLE EAST INDUSTRIAL MACHINE & TOOLS INTERNATIONAL
(AL MADINA INFORMATION AND BUSINESS)
1996 EVENTS:
AUG 5-11 AMMAN INTERNATIONAL TRADE FAIR
(AL MADINA INFORMATION AND BUSINESS)
SEP 22-26 MIDDLE EAST TRAVEL & TOURISM MARKET
(AL MADINA INFORMATION AND BUSINESS)
OCT 14-17 MIDDLE EAST FOOD TECHNOLOGY & CATERING INTERNATIONAL
(AL MADINA INFORMATION)
NOV 4-7 MIDDLE EAST BUILDING MATERIAL & CONSTRUCTION EQUIPMENT
(AL MADINA INFORMATION AND BUSINESS)
NOV 20-24 MIDDLE EAST EDUCATION AND TRAINING INTERNATIONAL
(AL MADINA INFORMATION AND BUSINESS)
To the top of this page