Egypt and Jordan trade relations hindered by insufficient shipping lines
Commercial shipping lines between Egypt and Jordan are not sufficient for developing and increasing the volume of commercial trade, said Mohammad Abdullah, head of the Egyptian Commercial Office in Amman.
“Arab Bridge Maritime Company, owned by the governments of Egypt, Jordan and Iraq, operates between seven and nine shipping vessels on a regular basis to transfer goods between Egypt and Jordan. The ships are [...] not sufficient to absorb the movement of people and goods between countries,” said Abdullah.
Jordan does have a strong capacity for road transport, but maritime transport is faster and has lower costs, according to Abdullah. He pointed to the importance of private sector participation in increasing fleets for maritime transport by establishing companies specialised in this field.
“Several trade agreements link Egypt and Jordan, including the Agadir Agreement, the Arab convention on facilitation, and the free trade agreement, working toward free movement of goods between the two countries without custom tariffs,” said Abdullah. There are great opportunities for Egyptian exports in the Jordanian market, which previously relied heavily on Syria for agricultural commodities and other products, he added.
“Jordan was importing 60% of its needs from Syria, but this has now stopped because of the unrest in Syria,” added Abdullah.
Abdullah said the commercial office has spoken with the Ministry of Trade and Industry in Egypt, the export council and commercial companies in order to increase trade with Jordan, especially regarding fruits, vegetables, agricultural crops, legumes and oils.
According to a report from the Egyptian trade representative office in the Egyptian Embassy in Amman, Egypt is the seventh largest exporter to Jordan, with exports including gas and electricity valued at $704.3m last year. Saudi Arabia, China, United States, Italy, Germany and the UAE occupy the top six places in terms of exports to Jordan.
The report said that Egyptian exports of natural gas to Jordan for last year amounted to $182.1m in comparison to $123.8m in 2012 and $88.3m in 2011. Exports of electricity were $57.1m last year compared to $128m in 2012 and $233.3m in 2011.
Total trade volume between the two countries last year, according to the report, was $836.7m, with a $571.9m trade surplus in favour of Egypt.
The most important Egyptian exports to Jordan are natural gas, electricity, vegetable oils, iron and steel rods, fruit, ceramics, fertilisers, machinery and electrical equipment, chocolate, and black tea. The most significant imports are medicines, mineral fertilisers, pesticides, paper and fruits.
“The number of Jordanian companies contributing to investments in Egypt since 1970 through the end of last February is 1341, with total investments valued at $506.5m. The companies operate in the fields of telecommunications, information technology, construction, finance, services, agriculture, tourism, and industry,” said Abdullah.
Abdullah pointed out that the latest Egyptian project in Jordan, which is being established by Amer Group, is “Porto Dead Sea”, and its total investment is approximately JOD 800m, or $1.1m. It is expected to be completed in 2017.
There is a chance for cooperation in commercial trade, he said, as Jordan has a need for importing medicines and lotions from Egypt and exporting Jordanian medicines to Egypt. Obstacles related to registering and pricing in these two countries are currently being resolved, Abdullah added.