US pledges to boost trade with Jordan

By Paul Tate

AMMAN — Officials on Monday praised the success of the Jordan-US Free Trade Agreement (FTA) and promised to redouble efforts to phase out existing trade tariffs between the two countries, mainly in the textile and garments sector.

Speaking at the conclusion of the third meeting of the Jordan-US FTA Committee, Minister of Trade and Industry Sharif Zu’bi described the agreement as a success but called for a speedy reduction of remaining tariffs.

“We would like to see a reduction on garments and textiles and I raised this matter during our discussions. But we also need to focus more on producing goods tailored to the US market and in diversifying our exports,” said Zu’bi.

The minister said the government is currently running a JD4.5 million programme to support local businesses in upgrading the quality of their products in order to be able to compete in the competitive US market.

“We are cooperating with the private sector to diversify the exports to include medicine, jewellery, electrical appliances, electronic goods and cooling systems,” Zu’bi said.

At present Jordanian ready-made garments, which form the bulk of the country’s exports to the US, are subject to tariffs of between 25 - 30 per cent. These tariffs are scheduled to be completely eliminated by 2011.

US trade representative for Europe and the Middle East, Shaun Donnelly, noted that these goods represent only 10 per cent of overall trade under the FTA, and pledged to boost trade and phase out remaining tariffs over the coming years.

“I was not able to give a commitment during our discussion with regards to this issue, but we should bear in mind that the vast majority of our trade is working,” he said.

As a result of the Qualifying Industrial Zones (QIZ) deal and the Jordan-US FTA, signed in December 2001, the country’s exports to the US have soared from a meagre $13 million in 1999 to $1.3 billion in 2005.

The QIZ agreement, signed in 1997, came out of the 1994 peace treaty with Israel and entitles products produced in the zones to both duty-free and quota-free access to the American market as long as they have a specified Jordanian-Israeli input.

In the region, the US has signed free trade agreements with Bahrain, Israel, Oman and Morocco, and is currently holding talks with Egypt.

The United States is now Jordan’s second largest trading partner after Saudi Arabia, with 33 per cent of exports destined for the American market, said Zu’bi.

Clothing and garments remain the major export items, constituting 92.3 per cent of all exported goods. Total exports to the US in this sector totalled JD463.8 million in the first seven months of this year.

“The US sees Jordan as a pioneer in paving the way for our vision of a US-Middle East free trade area within the next 10 years. We will continue to focus on Jordan to strengthen our partnership and boost employment opportunities,” said Donnelly.

Tuesday, September 19, 2006