FROM STRENGTH TO STRENGTH

Jordan 2019 | ECONOMY | INTERVIEW

Economic reforms have put Jordan on the radar of international investors, and the government is utilizing the World Bank's global expertise to further improve its investment climate.

Muhannad Shehadeh
BIOGRAPHY
Muhannad Shehadeh is the former Minister of State for Investment Affairs and former President of JIC following a cabinet reshuffle in May 2019. Shehadeh has 22 years of experience in the economic and financial sectors. Prior to his tenure at JIC, he served at the Office of HM King Abdullah II as the Director of Investment and Business Development. He has over 14 years of professional experience in the banking and financial sector in Jordan, Lebanon, Egypt, and the West Bank, where he held key positions at HSBC and the Arab Bank. He graduated from Lincoln University with a master’s degree in business administration and a BSc in computer science.

Nearly five years after enacting Investment Law No. 30, what are the biggest impacts on the investment environment in Jordan?

Investment Law No. 30 was passed in 2014 to attract foreign investment and stimulate local investments. Compared to other investment laws in the region, it is a competitive legislative framework, offering a range of incentives and benefits in and outside the free zones. Jordan is largely open to foreign investment, and foreign and local investors are treated equally under the law. JIC is responsible for promoting new and existing investment in Jordan, including through simplifying investment procedures. The economic reforms in Jordan have led to the creation of a competitive investment environment and strengthening of the national economy. These reforms will be key to addressing investors' obstacles and making Jordan an attractive location for value-added investments.

Looking at export markets, what are the economic opportunities for Jordan?

The government is keen to integrate the Jordanian economy into the global market by liberalizing trade and benefiting from global trade and investment opportunities. These policies have led to the creation of a network of trade relations between Jordan, the region, and beyond, as well as large economic blocs, allowing increased market access for Jordanian products. JIC is working to find new markets to promote Jordanian products in East Africa and Central Asia, boosting national exports to an even greater extent as borders with Iraq and Syria slowly reopen. With the availability of regular, secure maritime routes, African markets are eager to import Jordanian industrial products.

We spoke with Airport International Group on its success story in terms of attracting private investment. What is the significance of this example for investment in Jordan?

Success is contagious, and success stories are critical for attracting further FDI. Though we signed the PPP for Queen Alia International Airport in 2007, the true success has been in the project's ability to deliver real results. The airport has the capacity to handle demand and long-term growth; it can manage 12 million passengers and serves as a regional hub with better facilities and services that meet international best practices. The airport contributes to tourism and business, thereby supporting economic growth. Jordan aims to replicate such PPP successes and offers PPP investment opportunities, driving economic growth and employment through well-defined partnerships in infrastructure, utilities, and service sectors.

After gaining significant ground in the World Bank's Ease of Doing Business ranking over the last two years, how will Jordan continue this trajectory?

After moving up 14 spots in the last two years, we aim for even more improvement. Looking deeper into the report, we can still see areas in which we need to progress, including ease of getting credit, protecting minority investors, resolving insolvency, and dealing with construction permits. We have seen advancement in some of these areas; Jordan's rank in getting credit stands at 134th out of 190 compared to 159th the year before. However, we are still weak in areas such as depth of credit information, credit registry coverage, and credit bureau coverage. Jordan has improved its credit information system by setting up a regulatory framework for establishing a private credit bureau and lowered the threshold for loans to be reported to the public credit registry. In addition, in 2018, Jordan improved access to credit information by establishing a new credit bureau, but we are looking for more enhancements in this sub indicator. We are focusing on indicators related to starting businesses, paying taxes, obtaining building permits, registering property, taking out loans, protecting minority investors, enforcing contracts, and securing an electricity connection, which reflects on saving time and money and initiates gradual improvement. These efforts are in cooperation with the World Bank Group and we are utilizing its global expertise to reach our targets.