Only 3 Companies Benefiting from Simplified EU Rule of Origin Agreement

AMMAN —AlGhad— Only three Jordanian companies have made use of the Simplified Rule of Origin agreement with the European Union (EU) since it was signed in July 2016.

Combined, the three companies export no more than EUR1.947 million worth of produce, according to the government’s official figures. Their main importers were Spain, Cyprus, France, Belgium and Hungary.

Overall, Jordan exports to the EU in 2017 totalled at JOD124.5 million, compared to JOD3.1 billion in imports from the Eurozone.

Ironically, upon signing the agreement, the government described it as a significant leap forward, and an exceptional advantage.

Representatives of the private sector confirm that the conditions of the agreement are making it difficult for the domestic economic sectors to benefit from it.

These conditions include the gradual integration of Syrian labour, at 15 per cent for the first two years, to 25 per cent afterwards.

Chairman of the Amman Chamber of Industry AP Ziad Homsi explains that, in addition to the conditions, there are other factors that limit the domestic sectors’ ability to benefit from the agreement.

One of these factors, according to Homsi, is that it does not include downstream industries, e.g. the foodstuff industry, one of Jordan’s primary export products.

President of the Jordanian Exporters Association Eng Omar Abu Wishah told AlGhad that the agreement will not aid Jordanian companies up exports to the EU.

Abu Wishah further explained that there are two main reasons why it wont.

First, there is the European consumer opinion to consider; many Europeans are not exactly open to consuming products from the Middle East.

The second factor, Abu Wishah reaffirms, is the agreement’s labour integration condition.

There are 936 factories in all 18 industrial zones included in the agreement.

Only 70 of them can directly export to the Eurozone.

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