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DE RUEHAM #7726/01 2831233
ZNR UUUUU ZZH
R 101233Z OCT 06
FM AMEMBASSY AMMAN
TO RUEHC/SECSTATE WASHDC 4747
INFO RUEHDOI/DEPT OF INTERIOR WASHDC
RUEHRC/USDA FAS WASHDC
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEAUSA/DEPT OF HHS WASHDC
RHEBAAA/DEPT OF ENERGY WASHDC
RUEAEPA/HQ EPA WASHDC

UNCLAS AMMAN 007726 
 
SIPDIS 
 
SIPDIS 
 
STATE PASS TO National Science Foundation 
STATE Interior for International/Senhadji 
Commerce for NOAA/International/Ware-Harris, Child 
Commerce also for NIST/International 
EPA for International/Medearis 
 
E.O. 12958: N/A 
TAGS: TSPL BEXP SENV KTIA TBIO TPHY ETRD JO
SUBJECT: Jordan Welcomes S&T Engagements with Business Flavor 
 
Ref: Amman 4527 
 
¶1.  Summary:  Jordanian officials, academics and businessmen 
welcomed progress on two major, parallel S&T projects during 
late-September meetings with USG and private Americans: the 
private-sector focused Jordan Science and Technology Initiative 
(JSTI), and the government-to-government Science and Technology 
Agreement.  End summary. 
 
¶2.  Ken Ferguson, Middle Eastern Affairs Officer from the OES 
Bureau's Office of Science and Technology Cooperation (OES/STC), 
visited Amman September 16-22 as part of a public-private delegation 
representing the Jordan Science and Technology Initiative (see 
below).  While in Amman, Ferguson undertook a round of separate 
meetings with GOJ officials to discuss the proposed Science and 
Technology (S&T) Agreement between the two governments. 
 
--------------------------------------------- ---- 
Minister Puts S&T on Agenda of Free Trade Meeting 
--------------------------------------------- ---- 
 
¶3.  At the request of Jordan's Minister of Industry and Trade (MOIT) 
Sharif Zu'bi, S&T cooperation was put on the agenda of the 
U.S.-Jordan Free Trade Agreement (FTA) Joint Committee meeting on 
September 17 although the subject does not fall in the purview of 
the FTA.  Zu'bi opened the segment on S&T by saying that the S&T 
Agreement is "close to my heart."  He said that the "important" 
U.S.-Jordan S&T Agreement will "open the way" for the cooperation 
and technology transfer that Jordan needs to move to a 
technology-based economy. 
 
¶4.  In response to GoJ inquiries, Ferguson noted that S&T agreements 
do not come with their own funding, but are rather a mechanism to 
develop funding for particular projects.  He stressed the need on 
the U.S. side for C-175 interagency approval before negotiations 
could begin, adding that the C-175 clearance process would start 
soon and would take a minimum of several weeks.  Noting his presence 
in Amman as part of the Jordan S&T Initiative (JSTI) delegation, 
Ferguson said that the JSTI is exactly the type of S&T cooperation 
that we would hope for under the framework of the S&T agreement. 
 
--------------------------------------------- ------- 
Information and Idea Session on STA at Working Level 
--------------------------------------------- ------- 
 
¶5.  On September 21, Ferguson had a follow-up meeting at the working 
level with MOIT Director of International Trade Policy Maha Al-Ali. 
Al-Ali was joined by a representative from the Higher Council for 
Science and Technology.  Ferguson and ESTH Officer outlined the 
essential processes, players, and mechanisms of the process for 
reaching an S&T agreement, including the need for C-175 interagency 
consultation and approval, the need for legal scrutiny at each step, 
and the fact that the agreement does not come with any dedicated 
funding.  In the absence of C-175 clearance, Ferguson emphasized 
that the discussions were informal and general in nature. 
 
------------------------------------- 
GOJ Has Done Interagency Coordination 
------------------------------------- 
 
¶6.  Al-Ali said that the GOJ has been coordinating internally on 
preparations for negotiating the S&T Agreement.  She said the 
Ministry of Planning and International Cooperation will likely sign 
and administer the agreement, that the Higher Council for Science 
and Technology (HCST) would implement the agreement, and that the 
Ministry of Industry and Trade would be the facilitator and point of 
contact during the negotiations. 
 
¶7.  Al-Ali, in asking about financing, said that the GOJ doesn't 
want to see the agreement "go on the shelf."  Ferguson reiterated 
that S&T agreements normally don't have funding, although the S&T 
Agreement with India has an endowment that came as a result of 
special circumstances.  Trying to raise an endowment would slow down 
the process of reaching an agreement, but management of an 
endowment, he allowed, would not be difficult. 
 
---------------------- 
Ideas on Possible Foci 
---------------------- 
 
¶8.  Ferguson noted the suggestion by HCST Secretary General 
 
Shuraydeh of including language on innovation and entrepreneurship. 
One possible focus of the U.S.-Jordan agreement could be technology 
transfer and building relationships between the academic and 
business communities.  ESTH Officer also noted Jordan's regional 
role, and suggested that perhaps this could be taken into 
consideration in the S&T Agreement. 
 
--------------------------------------------- -- 
JSTI Proposes Cooperation for Commercialization 
--------------------------------------------- -- 
 
¶9.  In parallel with a future S&T Agreement, the other major S&T 
project discussed during Ferguson's visit was the Jordan Science and 
Technology Initiative (JSTI).  JSTI was initially supported by a 
U.S. Trade Development Agency grant, and has been developed by the 
IC-Squared Institute affiliated with the University of Texas at 
Austin.  Three representatives from IC-Squared (Sid Burback, Norman 
Kaderlan, Jim Dukowitz) plus Ken Ferguson from OES/STC visited Amman 
September 16-22, and had a series of meetings to outline JSTI's 
business plan.  Their meetings included MOIT Minister Zu'bi, Dean of 
Science at the University of Jordan Dr. Hala Horani, Dr. Khaled 
El-Shuraydeh from the Higher Council for Science and Technology, Dr. 
Tarik Awad from the King Abdullah Fund for Development, Dr. Moayad 
Samman from the King Abdullah Design and Development Bureau (KADDB), 
and in-house meetings at the Embassy.  Private sector meetings 
included Omar Al-Masri from Edgo, Ghassan Nuqual of the prominent 
Nuqul Group, and Dr. Zaki Ayoubi from the Jordan Chamber of 
Industry. 
 
-------------------------------------- 
JSTI About Business, not About Science 
-------------------------------------- 
 
¶10.  Throughout their meetings, the JSTI team emphasized that JSTI 
is about business, not about science, and takes a market-driven, 
practical perspective.  JSTI started as the result of a conversation 
between then-Secretary of Commerce Donald Evans and King Abdullah 
about expanding the role of science and technology in the Middle 
East.  Development of the concept was supported by a grant from the 
U.S. Trade Development Agency to the University of Texas.  An 
initial feasibility study was then followed by a business plan. 
 
¶11.  JSTI was developed by experienced businessmen who used 
conservative estimates and clear metrics in developing JSTI's 
business plan, said Burback.  JSTI is a public-private partnership 
that is complementary to, not competitive with, existing 
institutions and programs.  The project's goal is to create local 
"ownership" of a mechanism that promotes and supports innovation, 
and to lead to job creation, technology transfer, and Jordanian 
competitiveness in high-technology sectors. 
 
--------------------------------------------- ---- 
Early Projects Will Help to Create 1,700 New Jobs 
--------------------------------------------- ---- 
 
¶12.  According to JSTI's conservative estimate, the initiative, if 
fully implemented, will create 30-40 new technology companies and 
1,700 new jobs in its first five years, said Burback.  JSTI has 
several components, including addressing regulatory obstacles, 
putting "gap" funding mechanisms in place, matching American 
businesses with an interest in Middle East markets with Jordanian 
partners, and coordinating among Jordanian stakeholders.  Bringing 
the private sector earlier into the R&D cycle is another goal, since 
that will help accelerate development and commercialization. 
"Mining and matching" interested U.S. firms to Jordanian companies 
will help to "jumpstart" the JSTI process.  Early projects are 
likely to focus on existing skills, and tailoring existing products 
to the regional market.  These are projects with a fast turn-around 
and a high probability of success. 
 
-------------------------------------- 
$7 Million Funding for First Two Years 
-------------------------------------- 
 
¶13.  JSTI is a business venture to commercialize research, said JSTI 
delegation head Sid Burback; it's not development assistance.  JSTI 
needs $7 million in funding for its first two years of operation. 
Of that $7 million, $1.4 million will go to a "gap" fund to help 
bring innovations to a prototype stage, at which point they'll be 
more attractive to commercial funding.  The remaining $5.6 million 
will be for operating JSTI.  Burback explained that there will 
 
clearly always be a need for public funds in JSTI's budget, probably 
about 30% of the budget.  Incubators that are 100% private have been 
problematic in the United States, said Burback.  Fees and other 
internally generated revenue should cover 70% of JSTI's budget.  The 
University of Texas team expects that its role will diminish over 
time as JSTI starts up and local staff gains expertise.  Burback 
estimated that once the Jordanian side gives approval and funding to 
JSTI, JSTI can be up and running in eight months, and working on 3-5 
low-risk, initial projects. 
 
¶14.  JSTI will link into the technology sector in Jordan and hopes 
to take advantage of both the U.S.-Jordan Free Trade Agreement and 
the proposed U.S.-Jordan S&T Agreement.  Dr. Khaled Shuraydeh, 
Secretary General of the Higher Council for Science and Technology, 
 
SIPDIS 
suggested additional wording for the S&T Agreement that would note 
its connection to innovation and entrepreneurship. 
 
----------------- 
When do We Start? 
----------------- 
 
¶15.  The reception by the GoJ given to the JSTI proposal was very 
warm.  Minister of Industry and Trade Zu'bi said JSTI was 
"fantasic," and is exactly what his ministry wants.  He went on to 
say that the process outlined by JSTI is "not a matter of choice," 
that Jordan cannot afford to remain focused on low technology 
industry.  Dr. Shuraydeh from the Higher Council for Science and 
Technology offered his wholehearted support, and HCST resources such 
as office space to get JSTI up and running ASAP.  Both Zu'bi and 
Shuraydeh asked, "What do we need to do next?" and noted their 
willingness to proceed even before a formal agreement is reached. 
 
--------------------------------------------- 
Organizational Meeting Suggested as Next Step 
--------------------------------------------- 
 
¶16.  Governance, credibility and Jordanian support for JSTI will be 
critical, said Burback and Norman Kaderlan from the University of 
Texas.  JSTI will need a champion and a strong board, and funding, 
of course.  Shuraydeh and MOIT Minister Zu'bi agreed with the 
delegation that an appropriate next step is to assemble a working 
group that would develop a structure, resource commitments, and an 
implementation plan for JSTI.  Burback said that the delegation 
would develop a short list of candidates for the proposed working 
group. 
 
¶17.  This cable was cleared by OES/STC. 
 
RUBINSTEIN