VZCZCXRO1682
RR RUEHROV
DE RUEHAM #4207/01 2901101
ZNR UUUUU ZZH
R 171101Z OCT 07
FM AMEMBASSY AMMAN
TO RUEHC/SECSTATE WASHDC 0605
INFO RUEHXK/ARAB ISRAELI COLLECTIVE
RUCPDOC/DEPT OF COMMERCE WASHDC

UNCLAS SECTION 01 OF 02 AMMAN 004207 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE FOR NEA/ELA AND EEB 
 
E.O. 12958: N/A 
TAGS: ECON SOCI JO
SUBJECT: REMITTANCES EQUAL ONE-FIFTH OF JORDAN'S GDP 
 
Sensitive but unclassified. Not for internet distribution. 
 
¶1. (U) Summary: An estimated 260,000 Jordanians currently work 
abroad, many in information technology (IT) in the Gulf due to more 
opportunities and higher salaries.  In 2006, remittances totaled 
$2.54 billion, equaling 19.6% of Jordan's gross domestic product, 
more than any single industry, and a large source of foreign 
currency.  The importance of remittances from the Gulf has tied 
Jordan's economy to that of oil-producing countries.  End Summary. 
 
Importance of Remittances to Economy 
------------------------------------ 
 
¶2. (U) The number of Jordanians abroad has stayed at about the same 
level, approximately 260,000, since 2000.  The number declined 
dramatically in 1991 following the first Gulf War when three hundred 
thousand Jordanians were expelled from Gulf states who accused 
Jordan of siding with Iraq during its invasion of Kuwait.  As 
political relations improved in the late 1990s, the number of 
Jordanian workers abroad increased. 
 
¶3.  (U) Worker remittances, defined as money sent to Jordan by 
Jordanians working or living abroad, represent a significant part of 
Jordan's economy.  In 1991, worker remittances as a percentage of 
GDP fell to 9 percent, but have been between 15 and 20 percent of 
GDP since 1994.  In 2006, expatriate workers sent $2.54 billion to 
Jordan, up from $1.93 billion in 2002.  Remittances now equal 19.6% 
of Jordan's gross domestic product (GDP), among the world's highest 
percentages.  The World Bank reports that this figure accounts for 
remittances sent through formal channels only, mainly banks, and 
informal channels could increase total remittances by 50 percent. 
Remittances augment Jordan's domestic savings and allow Jordan to 
import far more than it exports.  Remittances, along with tourism 
receipts and foreign direct investment in construction and 
manufacturing, are the largest sources of foreign currency for 
Jordan. 
 
Where Are They Working? 
----------------------- 
 
¶3. (U) An estimated 260,000 Jordanians, mostly Jordanians of 
Palestinian origin, work abroad today, primarily in Saudi Arabia, 
Kuwait, United Arab Emirates and other Gulf countries.  Unlike 
Palestinian counterparts in Syria or Lebanon, most Jordanian 
Palestinians are issued a passport which gives them the opportunity 
to work abroad.  According to U.S. Census data, 47,000 Jordanians 
are living in the United States, of whom 60 percent have 
naturalized.  Ten percent of them are enrolled in college or 
graduate school. 
 
¶4. (SBU) Rami Adwan, Consulting Director for DevoTeam Middle East, 
an IT consulting firm, agreed that the majority of expatriate 
Jordanians are working in the Gulf.  He added, however, that many 
would prefer to emigrate to Europe or North America but are unable 
to because of visa requirements.  He said that Europe is a closed 
labor market with high unemployment, and Canada has a four-year wait 
for visas and a three-year residency requirement.  In contrast, the 
process for Saudi Arabia and the Gulf is very easy, he noted, and 
whenever his company is awarded work in Saudi Arabia, they are also 
awarded residency permits. 
 
¶12. (U) According to a September article in Middle East Economic 
Digest (MEED), Gulf companies are actually under government pressure 
to replace foreign workers including Jordanians with locals.  A 
MEED-commissioned survey found that 72 percent of respondent Gulf 
companies said local hires had inadequate skills and a lack of 
qualifications, and 50 percent said local wage expectations were too 
high.  While the Saudi government seeks the "saudization" of its 
work force, according to MEED, Jordan and Lebanon were named as the 
countries from which business owners most wanted to hire local 
staff.  Jordan and Lebanon were also named by MEED and respondents 
as having the highest quality college graduates. 
 
¶13. (U) A September report by Oxford Business Group projected that 
employment of Jordanian workers in the Gulf will continue to be 
high, especially while the price of oil remains high.  The World 
Bank concurred that the economies of Saudi Arabia, UAE, Kuwait and 
the other Gulf countries have been growing quickly over the last 
four years and are forecast to do well in the years ahead.  The 
World Bank also noted the demand for Arabic-speaking labor in Gulf 
particularly in telecommunications, information technology, 
medicine, education, finance, training, consulting and management. 
 
Why Are They Abroad? 
-------------------- 
 
¶5. (SBU) Post contacts unanimously agreed that expatriate Jordanians 
were abroad because of more and better work opportunities and higher 
salaries.  Adwan said that the number of Jordanian IT professionals 
 
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working abroad dwarfs the number working domestically, because 90 
percent of the Middle East's IT work is in the Gulf - 60 percent of 
it is in Saudi Arabia alone.  Abdelmajeed Shamlawi, the director of 
an IT consulting firm in Jordan, said that IT salaries in the Gulf 
are double or triple Jordanian salaries, which he said average about 
$420/month for entry level, $1100/month mid-level, and $2100-$2800 
for senior level.  Many interlocutors commented that the cost of 
living can also be higher in the Gulf, particularly in Dubai. 
 
¶6. (U) In addition to going to the Gulf for higher salaries, 
Jordanian college graduates are going abroad because Jordan's 
economy cannot absorb them all.  Shamlawi said that Jordan is 
graduating 6,000 technical/IT graduates each year.  He said about 
2,500 can be absorbed into the Jordanian technology sector, while 
the rest are split between leaving Jordan for work, going to school, 
not working, or finding non-technical work.  The Jordanian 
government is aware of the mismatch between graduates and 
opportunities.  Minister of Information and Communication Technology 
Bassem Rousan told EconOff that one of the major goals for Jordan 
and his ministry is to increase the number of domestic IT workers 
from 12,000 to 33,000, and to retain more of the 6,000 annual 
technical graduates. 
 
¶7. (U) Issa Gammoh, Assistant CEO at Jordan Investment Board, said 
he has seen a switch in thinking with more recent graduates making 
it a priority to stay in Jordan, especially as salaries in Jordan 
have improved.  Sabri Tabaa, CEO at Int@j, Jordan's IT industry 
association, said that IT salaries have grown in the last 18 months 
but still do not match Gulf salaries.  Gammoh and others said 
Jordanians spend time abroad often to achieve a particular financial 
goal, such as buying a first home. 
 
How Long Do They Stay Abroad? 
----------------------------- 
 
¶8. (U) Shamlawi said that most people go to the Gulf for two to four 
years and return more experienced, and able to command higher 
salaries than if they had stayed in Jordan.  Shamlawi said that 
Jordanians want to return to Jordan because there is no comparable 
social life in Kuwait, Qatar, or Saudi Arabia.  Tabaa added that 
Jordanians who go to Saudi Arabia usually return, but said that 
expatriates in Dubai usually stay abroad. 
 
¶9. (U) Adwan disagreed vigorously that most expatriates are abroad 
only temporarily.  He said he knew very few with plans to return to 
Jordan permanently, and that those who do return typically have a 
sick parent or other family responsibilities.  He said a fair 
number, like himself, commute weekly, spending weekends in Jordan 
and weekdays in Saudi Arabia.  Hisham Salaitah, Customer 
Satisfaction Manager at Royal Jordanian Airlines, said that 
traveling expatriates are a significant percentage of their 
Jordanian passengers. 
 
Who Remains in Jordan? 
---------------------- 
 
¶10. (U) Geoffrey White, a consultant working for Lufthansa 
Consulting said that Jordanians from prominent, typically 
non-Palestinian, families are unlikely to want to work abroad.  He 
said their access to interesting work is better in Jordan because of 
their family connections.  Hani Ashour, President of Food City, said 
that it can be hard to find work in the Gulf without professional 
qualifications and that non-professionals are more likely to stay in 
Jordan. 
 
Comment 
------- 
 
¶14. (U) Remittances are clearly a key pillar of Jordan's economy and 
allowing citizens here a higher standard of living.  A recession in 
the Gulf or a decline in oil prices, however, will be felt 
immediately in Jordan, in effect rendering Jordan a cyclical 
oil-based economy even in the absence of oil.  There is large 
disagreement among our contacts whether the spread of Jordanians 
worldwide is good or bad for Jordan.  Some business owners argue 
that the Gulf is only a two-hour flight away, and Jordanians in the 
Gulf should be considered the same as families dispersed throughout 
the United States.  Others believe Jordan could potentially lose an 
entire generation of its best and brightest. 
 
Visit Amman's Classified Website at 
http://www.state.sgov.gov/p/nea/amman 
 
HALE