Jordan\'s trade with Iraq jumps 60 percent
Jordan's trade with Iraq markedly improved during the first 10 months of this year with two-way trade seeing a 194 million Jordanian dinar increase over the same period of 1999. Preliminary figures released by the Jordanian Department of Statistics (DOS) reveal bilateral trade jumped to JD482 million for the January-October period of 2000 against JD288 million, recorded for the same period a year earlier.
Iraq-bound goods rose by more than JD26.6 million year-on-year, while Jordanian imports increased by more than JD167.6 million, the DOS figures showed. Jordan's drug industry was the number one beneficiary from enhanced trading. According to the DOS, medications topped Jordan's exports list to its eastern neighbor with a 30 percent jump from JD38 million worth of goods this year versus JD21 million in 1999. In addition, officials forecast a 10-15 percent growth in Jordanian pharmaceutical exports to Iraq over the next year. They pin their hopes on the recent Iraqi decision to allow their private sector to import pharmaceuticals.
Oil and fat, whether of animal or vegetable origin, ranked second in exports valued at JD30 million, around a JD6 million rise compared to last year. Economists say the competitiveness of the Jordanian oil and fat industries explains the higher demand. “Many Iraqi firms depend on Jordanian oil and fat in their foodstuff or chemicals industries,” says Hani Khalili, a private sector analyst. “Most Jordanian oil and fat factories were set up to serve the Iraqi market,” says Michel Sayegh, deputy chairman of Amman Chamber of Industry.
“The improved performance of these firms has reflected in a larger volume of exports,” adds Sayegh. However, he notes that despite the year on year rise of exports, which have been governed by the Jordan-Iraq oil-for-food agreement, oil and fat exports themselves have dropped to 10 percent.
On the imports front, crude oil and oil derivatives, which have always accounted for the largest portion of Iraqi exports to the Kingdom, stood at JD397.6 million during the January-October period, a JD127.4 million increase over 1999. The DOS data shows that 153.9 million tons of petroleum were imported over the 1999's amount.
The rise in the oil import bill was mainly blamed on the increase in the cost of oil bought from Iraq, which went up from $13.5 per barrel in 1999 to $19.5 in 2000, and led to a $120 million deficit in the 2000 budget. The burgeoning number of vehicles on the Kingdom's roads through 2000 was also cited as a major reason behind higher petrol consumption.
Around 42,000 vehicles were registered during the first nine months of 2000, compared to 11,455 registered a year ago, official statistics said. A government decision to decrease the customs fees on automotive vehicles led to the surge in sales.
Trade with Iraq is expected to see further increases in 2001.
The Jordanian-Iraqi trade protocol was raised to $450 million from $300 million this year.
Last November, Iraq agreed to supply Jordan with five million tonnes of crude oil and oil derivatives for 2001, at a ceiling price of $20.9, almost $2 higher than 2000 prices. Half of the oil supplies are received free, and the rest at preferential prices. — ( Jordan Times )
By Rana Awwad
© 2000 Mena Report (www.menareport.com)