Economic Data
Total GDP (in U.S.$): $15.5 billion (1998)
GDP Growth: 2.2 percent (1998)
Per Capita GDP (in U.S.$): $3,500 (1998)
Inflation: 4 percent (1998)
Unemployment Rate: 15 percent (1998)
Trade Balance: $2.4 billion deficit (1997)
Exports (U.S.$): $1.5 billion: phosphates, fertilizers, potash, agricultural products, manufactured goods. Export trading partners: Iraq, India, Saudi Arabia, EU, Indonesia, UAE, Syria, and Ethiopia.
Imports (U.S.$): $3.9 billion: crude oil, machinery, transport equipment, food, live animals, manufactured goods. Imports trading partners: EU, Iraq, U.S., Japan, Turkey, Malaysia, Syria, China.
Best Prospects for Export: Telecommunications, pharmaceuticals, food and agricultural products, machinery and parts, mining, minerals and chemicals, transport equipment and parts, steel and iron, medical and pharmaceutical products, plastics and rubber, textiles, apparel, paper and cardboard.
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Hashemite Kingdom of Jordan
Location: Middle East, northwest of Saudi Arabia
Geographic Area: 89,213 sq. kilometers, slightly smaller than Indiana.
Climate: Arid desert, rainy season in the west from November to April.
Main Cities: Amman (capital), Irbid, Az-Zarqa
Population: 4.6 million (1999)
Languages: Arabic is the national language, but English is widely understood among upper and middle classes.
Time Zone: G.M.T. + 3, seven hours ahead of Eastern Standard Time.
Workweek: Offices are closed on Fridays. More than 60 percent of private offices are not open more than four hours on both Thursdays and Saturdays.
Type of Government: Constitutional monarchy. Legal system based on Islamic and French law.
Head of State: King Abdullah II (since February 1999). Prime Minister Fayez Tarawneh. The Prime Minister appoints the cabinet in consultation with the monarch.
Currency: 1 Jordanian dinar = 1,000 fils.
Exchange Rate: US$1 = .709 dinar (January 1999).
Economic and Political Conditions: Jordan is the smallest and poorest economy in the region. In recent years, Jordan has experienced slow economic growth, declining per capita income and high levels of unemployment. Agricultural output declined in 1999 as the result of drought. Jordan is committed to economic reforms, particularly privatization and improved investment incentives. The government signed a structural reform agreement with the International Monetary Fund (IMF) to stimulate production and general economic activity. Political and diplomatic relations between the United States and Jordan have been strong since the 1950s. The death of King Hussein I, and the succession of his son, King Abdullah II, should not alter bilateral relations. During the past 50 years, the U.S. has been one of Jordan’s most significant trading partners, and source of foreign assistance. Since 1952, the U.S. has provided more than $1.5 billion in economic assistance.
Tarriffs, Trade,Taxes, Trademarks
Trade Regulations and Tariffs: Trade policies are not consistent with WTO free trade objectives. While Jordan receives the benefit of U.S. Generalized System of Preferences (GSP) and Normal Trade Relations status, Jordan does not now have reciprocal treatment of goods imported from the United States. The ceiling on industrial raw materials is 10 percent, and on all other duties is 35 percent. Capital equipment imported for licensed industrial projects are exempt from tariffs. Tariffs fall into six different levels from zero to 35 percent, depending on the Harmonized Code.
Taxation: Corporate taxes of a flat 40 percent of profits are levied on all Jordanian companies and ventures. Financial corporations are taxed 50 to 55 percent. A 13 percent general sales tax is levied on imported and locally produced goods. The government may establish a value added tax (VAT) to replace the general sales tax. Personal income taxes are 45 percent of the total Jordanian-earned income, less exemptions and deductions. Jordan has signed a tax treaty with the United States that protects against double taxation.
Foreign Investment: Foreign, non-Arab investors are not allowed to invest in industry, tourism, health, agriculture, housing and development projects without approval by the Minister of Industry and Trade. Local investors are increasingly interested in franchising, especially in the services and fast food industry. U.S. retail and service franchises have grown significantly in recent years, including Subway, Arby’s, Pizza Hut, Kentucky Fried Chicken, Boston Fried Chicken, McDonald’s and Dunkin’ Donuts.
Free Trade Zones: Shipping agents, representatives of land, sea and air transport, and clearing firms may ship goods into Jordan’s free trade zones. All shipping documentation must be submitted to the free trade zone authorities within 72 hours of arrival and before the shipment is unloaded. Goods in transit may be stored in warehouses at the Port of Aqaba for up to one month, after which they must be moved to a free trade zone.
Trade Finance: Thirteen commercial banks operate in Jordan, of which five are branches of foreign banks. Five investment banks, two Islamic banks and one industrial development bank, as well as specialized credit institutions, also provide trade and project financing. The Central Bank of Jordan allows banks to make loans and extend credit in foreign currency. In these cases, repayment must be made in that foreign currency. Over 26 percent of the credit market activity was directed to financing trading activities. A comprehensive feasibility study that includes detailed cash flow analysis is required to obtain project financing. The U.S. Ex-Im Bank and the Central Bank of Jordan signed an agreement allowing the private sector to import U.S. goods using the Ex-Im Bank’s short- or medium-term credit guarantees.
Marketing and Selling Factors: No foreign company may import goods into Jordan without appointing a registered agent, according to the Commercial Agents Law. The agent must have a direct connection to the foreign firm, with no sub-agent or intermediary allowed. Because customs valuation policies are not clear, U.S. exporters should coordinate with their representative before establishing a final price.
Joint ventures with Jordanian partners are one method of penetrating the local market. The Jordanian partner’s market experience can overcome cultural differences when conducting business.
Advertising and trade promotions that feature U.S.-style contests, giveaways, drawings and other promotions are gaining popularity. U.S. exporters presently participate in local exhibitions and advertise in local media.
Service and customer support are important selling points, while workshops and training seminars for local agents are useful sales tools.
Patents/Trademarks/Copyrights: Intellectual property laws do not meet international standards, thus U.S. companies lose millions of dollars in sales of pirated reproductions of copyright-protected or patented products. The Jordanian government has begun the process of bringing its laws into conformance with the international standards established by the World Trade Organization (WTO) and the World Intellectual Property Organization (WIPO).
Key Contacts
The John H. Chafee Center for International Business and World Trade Center, Bryant College
Raymond W. Fogarty, Director, Edward Barr, World Trade Center Manager
Telephone: (401) 232-6407 or (401) 232-6408,
Fax: (401) 232-6416
E-Mail: postoffice@itdn.net Web site: http://www.rieac.org
Rhode Island Economic Development Corporation (RIEDC)
Maureen Mezei, International Trade Director.
Telephone: 222-2601, ext. 123
e-Mail: mmezei@riedc.com
U.S. Export Assistance Center, Department of Commerce
Keith M. Yatsuhashi, International Trade Specialist.
Telephone: (401) 528-5104
E-Mail: kyatsuha@mail.doc.gov
U. S. Small Business Administration
Marilyn Bogue, International Trade Officer. Telephone: 528-4585. E-Mail: marilyn.bogue@sba.gov
Embassy of Jordan
3504 International Drive NW
Washington, DC 20008
Telephone: (202) 966-2664
Fax: (202) 966-3110
U.S. Embassy in Jordan
Jabel Amman, P.O. Box 354,
Amman 11118 Jordan; APO AE 09892-0200
Telephone: (962) 6-5920101
Fax: (962) 6-5927712
English Language Publications
Jordan Times
The Arab Daily
Country Profile
Compiled by Providence Business News,
in collaboration with Bryant College Export Assistance Center.
