|Jordanís export industries had an excellent year in 2006, with most sectors recording solid growth as the Kingdom cashed in on free trade agreements, increases in domestic productivity and a growing push by the government to promote overseas trade. |
According to figures released by Department of Statistics in mid-February, $4.1 billion of exports were made in 2006, a 12.9 percent improvement on the previous year.
By adding the value of re-exported goods to the equation, Jordanís total exports came to $5.1 billion, a year-on-year rise of 20 percent.
However, the news was not all good, as last year saw a further widening of Jordanís trade deficit, coming in at $6.2 billion, a 1.3 percent increase despite good export results. The major factor contributing to Jordanís trade deficit was the high price of oil.
Last year, the Kingdom imported $2 billion worth of crude, most of which came from neighboring Saudi Arabia.
As has traditionally been the case with Jordanís exports, the clothing industry led the way, with an 18 percent jump in overseas sales, well above the 5.1 percent increase recorded in 2005. Overall, clothing exports accounted for 30.3 percent of the Kingdomís exports, bringing in $1.23 billion.
Other strongly performing exports include fertilizers, with sales of $320 million, making it the second highest overseas revenue earner, and pharmaceutical products, third in line, with sales of $295 million, or 7.2 percent of all exports.
In recent years, the US has supplanted regional partners as the biggest destination for Jordanian exports. In 2006, this trend was reinforced, with the US spending $1.26 billion on Jordanian goods, 31.2 percent of the national total.
However, the product range was limited, with just under 91 percent of all imports from Jordan consisting of clothing.
The driving force behind Jordanís escalating exports to the US has been its free trade agreement with Washington, which came into effect in 2001, the first of its kind between the US and an Arab country.
Since then, there has been a 500 percent increase in the flow of Jordanian goods to the US. In its fight to address its widening trade deficit, the FTA has been beneficial to Jordan, which is building a healthy surplus in its dealings with the US, with 2006 imports amounting to just $547 million.
Jordanís exports to the countries of the Greater Arab Trade Zone, which encompasses the Palestinian territories, Iraq, Lebanon, Syria, Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, Yemen, Libya, Morocco, Sudan, Egypt, Tunisia and the United Arab Emirates, constituted 40.5 percent of the 2006 total overseas sales. Nevertheless, exports to Iraq, Jordanís second single largest market, fell sharply, dropping by nearly 15 percent to $458 million.
Another developing export market is India, which spent $292 million on Jordanian goods last year, 9.6 percent of the total, ranking it third on the list behind the US and Iraq.
One area of concern for Jordanian officials is the massive trade imbalance with the EU. Although the bloc accounts for around one third of all Jordanian imports, sales to EU member states represented just 3.4 percent of the Kingdomís exports in 2006.
On February 21, the Ministry of Planning & International Cooperation together with the Ministry of Industry & Trade launched a joint project to boost the capacity of trade departments and to improve the abilities of other related departments to facilitate the implementation of trade agreements, especially with the EU.
An EU-funded project, supported by Germanyís Ministry of Economics & Technology and Franceís Ministry of Economy, Finance & Industry, will provide Jordanian officials with training in trade-related issues and negotiation techniques in the areas of competition, intellectual property rights and national production protection.