P 051309Z NOV 08
FM AMEMBASSY AMMAN
TO SECSTATE WASHDC PRIORITY 3788

UNCLAS AMMAN 003022 
 
 
STATE FOR EEB/TPP/BTA AND NEA/ELA 
STATE PASS TO USTR FOR GBLUE 
 
E.O. 12958: N/A 
TAGS: ETRD ECON EFIN JO
SUBJECT: Jordan 2009 National Trade Estimate 
 
Ref: State 88685 
 
¶1.  Per reftel, below is the text of Jordan's 2009 National Trade 
Estimate, also sent, as requested, to USTR as a Microsoft Word 
document. 
 
¶2.  Begin Text: 
 
TRADE SUMMARY 
 
The U.S. goods trade deficit with Jordan was $261 million in the 
first 11 months of FY 08, a decrease of $248 million from $509 
million in the first 11 months of FY 07, owing to an increase in 
U.S. exports to Jordan and a decline in imports from Jordan, due, in 
part, to a global decline in textile trades.  U.S. goods exported in 
the same periods of FY 08 and FY 07 were $807.5 million and 724.9 
million respectively, representing an increase of 11.4 per cent. 
Correspondingly U.S. imports from Jordan were $1.07 billion, down 
13.4 per cent.  Jordan is currently the 77th largest export market 
for U.S. goods. 
 
Note: Source of Data USITC; Rank is based on January - August 2008. 
 
 
The United States-Jordan Free Trade Agreement 
--------------------------------------------- 
 
Under the terms of the United States-Jordan Free Trade Area 
Agreement (FTA) which entered into force on December 17, 2001, the 
United States and Jordan agreed to phased tariff reductions 
culminating in the complete elimination of duties on all products by 
¶2010. 
 
IMPORT POLICIES 
 
Tariffs 
------- 
 
Jordan's simple average applied tariff is approximately 11 percent, 
down from 13 percent in 2006, with a maximum rate of 180 percent on 
certain agricultural products.  Most raw materials and intermediate 
goods used in industry have been zero-rated.  Tariffs between the 
United States and Jordan are being eliminated as per the terms of 
the FTA. 
 
The Jordan General Sales Tax law allows the government to impose a 
"Special Tax" at the time of importation or local production. 
 
Agriculture 
----------- 
 
U.S. agricultural exports to Jordan were $129.6 million in 2007. 
Top U.S. agricultural exports consist of grains (corn, rice, and 
wheat respectively), soybean cake, processed and canned food, 
condiments, vegetable oil, almonds and poultry (both live and 
carcasses).  Under the terms of the FTA, import duties and other 
trade barriers between Jordan and the United States must be phased 
out by 2010.  Tariffs less than 5 percent have already been 
eliminated.  Jordan excludes certain imports from the FTA's direct 
customs tariff relief, notably poultry, dairy products, and apples. 
 
Certain non-tariff barriers impact U.S. exports to Jordan. Jordan 
selectively imposes sanitary and phytosanitary measures on meat and 
poultry, effectively creating non-tariff barriers on imports of 
these products.  In 2006, Jordan banned the importation of beef and 
live bovine animals from all U.S. states after the announcement of 
the discovery of a single case of Bovine Spongiform Encephalopathy 
(BSE) in Alabama.  The subsequent partial lifting of the ban was 
accompanied by strict conditions that only allow boneless uncooked 
and unprocessed meat, in addition to many other limitations that 
have proven difficult to meet by both U.S. exporters and Jordanian 
importers.  Import licenses, or advance approvals to import goods, 
are required for specific food and agricultural goods. The 
authorities granting such licenses and approvals include the 
Ministry of Agriculture, and the Ministry of Health. 
 
Import License and Pre-Shipment Inspection 
------------------------------------------ 
 
In addition to the special requirements for certain agricultural 
products, Jordan requires that importers of commercial goods be 
registered traders or commercial entities. The Ministry of Industry 
and Trade occasionally issues directives requiring import licenses 
for certain goods or categories of goods. 
 
Jordan ended in September 2007, a pre-shipment inspection program 
(the Daman Program) administered through the Jordan Institute of 
Standards and Metrology (JISM) which the United States considered to 
be a non-tariff trade barrier. The Daman Program has not been 
replaced. 
 
STANDARDS, TESTING, LABELING AND CERTIFICATION 
 
JISM is shifting the focus of its compliance inspection activities 
for imported and locally-produced goods from ports of entry to a 
market surveillance system.  JISM issues and routinely updates 
standards for approximately 1,300 products.  JISM has licensed 
several laboratories to test for compliance with applicable 
standards. 
 
JISM's current product standards reflect existing U.S. standards. 
Although JISM worked with EU agencies to review its standards and 
incorporated new sets of standards, JISM's director has assured the 
United States that any changes would not be biased against U.S. 
standards, also considered international standards. 
 
JISM also issues and enforces labeling requirements. 
 
GOVERNMENT PROCUREMENT 
 
In 2002, Jordan commenced its accession to the WTO Government 
Procurement Agreement (GPA), with the submission of its initial 
entity offer. Subsequently, Jordan submitted revised entity offers 
in 2004, 2006, and 2007.  Currently, foreign investors can bid on 
government-commissioned research and development programs for which 
international or mixed bidders are eligible.  Alternatively, foreign 
bidders can bid on such programs with a Jordanian partner. This 
requirement will be dropped when Jordan accedes to the GPA. 
 
EXPORT SUBSIDIES 
 
All exporters are granted the following incentives: 
 
-- Net profits generated from most export revenueQare fully exempt 
from income tax.  The mining sector is excluded, as are exports 
governed by specific trade protocols and foreign debt repayment 
schemes.  Under the WTO, the tax exemption was initially set to 
expire on January 1, 2008, but upon the request of Jordan, the WTO 
granted an extension through December 2015, subject to an annual 
review by the WTO. 
 
-- Foreign inputs used in the production of exports are exempt from 
customs duties and sales taxes; all additional import fees are 
assessed on a reimbursable basis. 
 
INTELLECTUAL PROPERTY RIGHTS (IPR) PROTECTION 
 
Prior to its accession to the WTO, Jordan passed several new laws to 
improve protection of intellectual property rights (IPR), patents, 
copyrights, and trademarks.  These laws, which were passed to 
implement the WTO Agreement on Trade-Related Aspects of Intellectual 
Property Rights (TRIPS), now protect trade secrets, industrial 
designs, plant varieties and semiconductor chip designs. The IPR 
regime requires registration of patents and trademarks. Copyrights 
may be registered with the National Library, a part of the Ministry 
of Culture, though it is not obligatory and does not affect rights 
under the law.  New Plant Varieties (NPV) are registered with the 
NPV Registrar of the Ministry of Agriculture.  Patents must be 
registered with the Registrar of Patents and Trademarks at the 
Ministry of Industry and Trade.  Jordan's cabinet has issued a 
decision to join the Patent Cooperation Treaty and the protocol 
relating to the Madrid Agreement Concerning the Registration of 
Marks, but accession and ratification are still pending. 
 
Jordan's pharmaceutical industry generally abides by the new Patent 
Law.  In addition, by signing the 
FTA, Jordan committed to even stronger enforcement of IPR.  It 
acceded to the World Intellectual Property Organization (WIPO) 
treaties on copyrights (WCT) and performances and phonographs 
(WPPT). The United States is working together with Jordan to address 
concerns that Jordan needs to strengthen its protection of 
undisclosed information against unfair commercial use for 
pharmaceutical products, as well as other U.S. concerns regarding 
Jordan's implementation of its FTA commitments. 
 
Jordan's record on IPR enforcement has improved.  Enforcement 
mechanisms and legal procedures, however, are still not fully 
effective and are in need of further refinement.  As a result, the 
government's record on IPR protection remains mixed. Jordan has 
worked in 2008 on amendments to its copyright regulations and to the 
law governing the organization responsible for trademarks to meet 
international obligations and standards.  A sizeable portion of 
videos and software sold in the marketplace, however, remain 
pirated.  Enforcement action against audio/video and software piracy 
is growing in quantity and improving in its targeting capability, 
but successful prosecution of piracy cases remains inconsistent.  In 
2008, Jordan issued its first software piracy jail sentence.  The 
number of trademark and copyright violation cases referred to the 
courts has also increased.  Jordan has been in attendance at several 
recent Anti-Counterfeiting Trade Agreement (ACTA) meetings and 
continues to discuss formally joining the ACTA negotiation. 
 
SERVICES BARRIERS 
 
As part of its WTO commitments, Jordan agreed to allow unlimited 
market access in telecommunications services no later than January 
 
1, 2005.  Nevertheless, the now privatized Orange (Jordan Telecom) 
still enjoys a de-facto monopoly of land lines and the internet 
gateway. 
 
INVESTMENT BARRIERS 
 
The government continues to revamp its investment promotion system. 
It is re-examining investment incentives with the consolidation of 
all investment promotion activities under a renewed Jordan 
Investment Board (JIB). These developments will likely lead to 
expanded investment opportunities in Jordan for U.S. investors. 
 
Jordan's investment laws treat foreign and local investors equally, 
with the following exceptions (as per regulation No. 54 of 2000, 
entitled "Non Jordanian Investments Promotion Regulation"): 
 
-- Under the terms of the United States-Jordan FTA, ownership of 
periodical publications is restricted to Jordanian natural persons 
or Jordanian juridical entities wholly owned by Jordanians; 
 
-- Under the same agreement, foreign investors are limited to 60 
percent ownership in printing/publishing and in aircraft or vessel 
maintenance and repair services; and 
 
-- Also under the FTA, foreign investors are limited to 50 percent 
ownership in a specified list of businesses and services. 
 
In general, foreign investors may not have whole or partial 
ownership of investigation and security services, sports clubs 
(except for health clubs), stone quarrying for construction 
purposes, customs clearance services, and land transportation of 
passengers and cargo using trucks, buses and taxis. 
 
While Jordanian laws set limitations on foreign ownership in certain 
sectors, the laws also allow for the government to grant exceptions 
to these limitations where it deems appropriate. This exception 
policy is viewed as being too selective by some potential U.S. 
investors. 
 
The FTA Annex 3.1 has a complete listing of limitations on 
investments and may be found at http://www.ustr.gov. 
 
ELECTRONIC COMMERCE 
 
Jordan has some legislation regulating electronic commerce, although 
there has yet to emerge a clear body of regulations and tax laws 
covering electronic commerce transactions. Legislation that allows 
for and regulates electronic signatures is still needed. Jordan does 
not impose tariffs on electronic transactions. 
 
End text. 
 
Visit Amman's Classified Website at: 
http://www.state.gov.sgov.gov/p/nea/amman/ 
 
Beecroft