|King puts Jordanian economic efforts into sharp focus.
|The Kingdom appears to have all the necessary tools to develop its economy, but observers suggest efforts have only been moderate.|
JORDAN (Star) - His Majesty King Abdallah's explicit remarks earlier this week spoke directly to the need for the government to work hard, fast and efficiently to achieve better results in developing and expanding the Jordanian economy. "We need to accelerate our efforts to show the benefits of our economic struggles," the King told members of the Ministerial Economic Team.
The Kingdom appears to have all the necessary tools to develop its economy, but observers suggest efforts have only been moderate. The Europeans unanimously approved the EU-Jordan Association Agreement. The Free Trade Agreement with the US is also moving along at a steady pace and Jordanian trade relations with Arab countries continue to improve.
These developments are a strong incentive for public and private sector joint activities to develop fruitful economic partnerships and overall economic expansion for Jordan.
Economists suggest the King's strong words were a warning for the government to consider the present passivity in dealing with investments, something Jordan has promised to implement this year and beyond.
The EU member states aid programs to Jordan are expected to increase in coming years in keeping with their decision to establish a bilateral free trade area.
The US is also putting more money into Jordan, making use of its expertise and business abilities to fulfill the Kingdom's long-term economic development goals. The QIZs (Qualified Industrial Zones) and development-oriented investments are all designed to move Jordanian-made exports to US markets.
Economist Yousef Mansour believes Jordanian industrialists need more than incentives to expand their exports to the US markets. "Almost all the industries in the QIZs are fabrics. I believe other industries need similar opportunities to fine-tune the quality of their exports toward international standards," he said.
Mansour explained the current 10-year exclusivity for textiles manufacturing in the QIZs will end 2004. The QIZs give Jordan priority in US markets for 30 years-a fact forcing other industries in the Kingdom to set establish a presence in these zones quickly.
"The private sector needs a far-reaching strategy relying not only on human resources but also value-added and quality of products. These all are a must for competitiveness in world markets," Mansour added.
Sounds of dissatisfaction among cabinet officials remain over the sluggish nature of the private sector to participate in the government controlled multi-million dollar investments. Minister of Planning Bassem Awadallah said the government is providing all the facilities required for the private sector to begin initiatives for promoting investment in local markets.
He asserted more laws and regulations are needed, "but what has been done so far is more than enough to help the private sector to conduct businesses with Europeans and the US on behalf of Jordan, rather being delivered to foreign investors." His words came at the time when regional economists expect more difficulties in Arab economies, following the deepening recession throughout world markets.
Economists suggest the recent financial scandal in Jordan forced many investors and businessmen, especially those from the Gulf countries and the Far East, to re-think their intentions for the establishment of businesses in the Kingdom. Although investigations continue, economists wonder when the government can finally put an end to the story.
"The recent scandal reveals the necessity for potent and efficient laws, including the illicit gains law to fight corruption in the Kingdom," said Othman Bdeir, president of the Amman Chamber of Industry. "Such laws encourage the private sector and foreign investors to have more trust in the local business environment, encouraging them to take part in development."
Fears of misconduct and misdeeds continue to prevail. But restrictions brought on by the military escalation in the Palestinian territories and Iraq only serves to heighten the apprehension.
If Jordan chose to utilize its GDP to pay off current debt it would be left with 20 percent of present GDP. The Jordanian economy is walking a tightrope amidst the political turbulence in the region.
This is apparent at the Amman Bourse where trading sessions remain overshadowed by consequences of the recent financial scandal. Shareholders at the stock market await the outcome of the investigations, and hope for an ebb in the Palestinian-Israeli conflict and a reverse in US plans to attack Iraq.
"Prospects for economic development in Jordan are negative," indicated a recent study by the Lebanese Economy And Business magazine. "Arab economies, including Jordan, will face a reduction in the number of foreign investments due to the reluctance of many venture capitals in the West to employ their money in developing economies."
Economists believe the Kingdom needs to turn plans to set up ventures with Arab Gulf states into actions. "We should utilize our experience and the wealth of Gulf states to prosper in joint businesses," Mansour stressed.
The Star redaction