VZCZCXRO3005
RR RUEHDE
DE RUEHAM #1571/01 1470554
ZNR UUUUU ZZH
R 260554Z MAY 08
FM AMEMBASSY AMMAN
TO RUEHC/SECSTATE WASHDC 2708
INFO RUEHEG/AMEMBASSY CAIRO 3668
RUEHAD/AMEMBASSY ABU DHABI 1228
RUEHAK/AMEMBASSY ANKARA 0601
RUEHIT/AMCONSUL ISTANBUL 0194
RUEHDE/AMCONSUL DUBAI 0434
RUEHRC/USDA FAS WASHDC
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEHRC/DEPT OF AGRICULTURE WASHDC

UNCLAS SECTION 01 OF 02 AMMAN 001571 
 
SENSITIVE 
SIPDIS 
 
CAIRO FOR FAS AGMINCOUNS PKURZ 
CAIRO FOR APHIS ATTACHE LLOGAN 
FAS FOR OFFICE OF GLOBAL ANALYSIS 
FAS FOR OFFICE OF TRADE PROGRAMS 
 
E.O. 12958: N/A 
TAGS: EAGR ETRD PGOV JO
SUBJECT: DRAFT LAW ESTABLISHING A CHAMBER OF AGRICULTURE TO BE 
SUBMITTED TO EXTRAORDINARY PARLIMENTARY SESSION 
 
REF:  A) AMMAN 518 
      B) AMMAN 79 
 
¶1. (U) Summary: After years of delay, a draft law establishing a 
Chamber of Agriculture (CHoA) in Jordan will be introduced to an 
extraordinary session of parliament, scheduled to start in mid-June. 
 The proposal to create an independent umbrella organization to 
promote agribusiness is part of Jordan's eight-year National 
Agricultural Strategy.  The Ministry of Agriculture is pushing hard 
to realize this plan, which the Minister believes will improve the 
agribusiness sector by consolidating the efforts of private and 
governmental institutions involved in agriculture.  Establishing a 
CHoA has been consistently opposed by the larger Chamber of Commerce 
which fears both a loss of its revenues and authority. 
Additionally, the government and private sector are seeking funds to 
establish an Agricultural Marketing Company to set export standards 
for Jordanian produce and to encourage contracted shipments to 
Europe.  End summary. 
 
Promoting Agribusiness 
----------------------- 
 
¶2. (SBU) Parliament will meet in an extraordinary session, scheduled 
to open mid-June (septel).  Among the agenda's priorities is a draft 
law establishing a Chamber of Agriculture (CHoA), a long overdue 
measure according to the Ministry of Agriculture (MoA).  Creating an 
umbrella organization to promote agribusiness is a key element of 
Jordan's 2002-2010 National Agricultural Strategy (NAS) and strongly 
advocated by the Agriculture Minister.  Jordan's agricultural sector 
contributes only 3 percent of GDP and the NAS posits that with 
sector reform, all agricultural economic activities could reach 30 
percent of GDP.  Dr. Mahmoud Al Najdawi, Assistant to the MOA 
Secretary General and the official responsible for technical affairs 
explained that additional benefits resulting from the establishment 
of a CHoA include extra revenues generated from the issuance of 
certificates of origin, which would then be invested in improving 
the quality of agricultural produce and boosting "brand 
recognition." 
 
¶3.  (U) Currently, certificates of origin are issued by the Chamber 
of Commerce (CoC) based solely on the ability of an applicant to pay 
licensing fees.  No agricultural expert is required to examine the 
produce for export.  "All that would change when the new ChoA takes 
over," asserts Najdawi.  Another change, according to Mohamed 
Awamleh, a business-oriented farmer and active member in many local 
and regional agricultural marketing forums, would be ChoA creation 
of a platform from which to address artificial barriers to 
agriculture trade, such as accumulated taxes on inputs and fees for 
foreign laborers.  Khader Aabawi, MOA Director of Legal Affairs told 
FAS Officer that the ChoA would also fill existing gaps related to 
the issuance of trade certification, licenses for agribusiness, and 
fee collection. 
 
Horticultural Community Lobbies for Its Own Advocate 
--------------------------------------------- ------- 
 
¶4. (U) Similarly, Jordan's horticultural community seeks to 
establish an Agricultural Marketing Company (AMC) to solve marketing 
challenges.  Horticulturists justify the need for an AMC by 
explaining that Jordan's horticultural exports suffered following 
the dismantlement of the government-run Agricultural Marketing 
Organization following Jordan's accession to the World Trade 
Organization.  An AMC, in their view, would help to link the output 
of high-grade horticultural products with a program to categorize 
horticultural produce by class and grade, thereby raising the 
quality and image of Jordanian horticultural products and also 
trimming huge post-harvest losses.  Farmers and exporters contend 
that absent local standards, they are subject to variables in the 
countries to which they export.  One trader reported that in the 
UAE, the price for Jordanian fruits and vegetables is based on the 
worst shipment received, so grade and packaging is not important. 
In contrast, Turkish traders purchase the best quality Jordanian 
produce and package and price it accordingly.  The AMC would seek to 
replicate the Turkish model. 
 
¶5. (U) Horticulturists also desire to "pre-contract" produce 
destined for European markets in order to earn top dollar for 
high-grade products in high-demand markets.  To do so, Jordanian 
 
AMMAN 00001571  002 OF 002 
 
 
producers must be successful in meeting high European standards like 
the European Good Agricultural Practices (Euro-GAB); in implementing 
local standards determined by the Jordann Institute for Standards 
and Metrology as of July 2008; and in producing, on a contractual 
basis, sufficient crops to meet demand and withstand market 
fluctuations.  The GoJ supports an AMC as an alternative to 
allocating funds to compensate farmers for losses due to natural 
disasters such as the January 2008 frost (ref A). 
 
¶6. (U) Successive ministers of agriculture have called for 
establishing a privately-owned marketing company to maximize 
revenues from the export of fresh agricultural products.  Abdallah 
Sheshani, MOA Director of the Private Sector Unit, told FAS Officer 
that MoA has raised $5 million in provisional funds from local 
sources (the private sector as well as Jordan's Social Security 
Corporation, the Agricultural Credit Corporation, the Jordanian 
Exporters and Producers of Fruits and Vegetables Association, the 
Farmers Union, and the Agricultural Engineers Union) for the 
endeavor.  MoA is still negotiating with the Arab Corporation for 
Agricultural Investment (ACAI) for an additional $5 million; ACAI 
has asked MoA to revise its visibility study in light of the 
skyrocketing prices of cereals and agricultural produce. 
 
Visit Amman's Classified Web Site at 
http://www.state.sgov.gov/p/nea/amman 
 
HALE