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Stakeholders ‘shocked’ by drop in exports to Iraq despite recent deals

Unexpected outcome attributed to ‘inability of Jordanian products to compete with alternatives’

By Maram Kayed - Sep 09,2019 - Last updated at Sep 09,2019

AMMAN — Exports to Iraq are down by almost 11 per cent compared with the same period last year, contrary to the expectations of Jordan’s trade and export sector, which expected recent agreements between the two countries to revive commercial exchange.

According to numbers provided by the Department of Statistics, the first half of this year witnessed a 10.6 decline in exports to neighbouring Iraq, valued at JD21.6 million.

The decline comes as a “shock” to Jordan’s projections, as phrased by Amman Chamber of Trade member Sultan Allan.

“After signing numerous agreements with Iraq, not only in the goods sector but also in the transport, construction and energy sectors, this outcome was not expected,” he said in a phone interview with The Jordan Times on Monday.

In February of last year, Jordan signed agreements with Iraq to exempt more than 334 Jordanian goods from taxes, in addition to other measures that followed the reopening of the Karameh-Turaibil border crossing between the two countries, such as the cancelling of the back-to-back truck loading process and replacing it with the door-to-door freight transport agreement.

After his visit to Iraq last year, Prime Minister Omar Razzaz and senior Jordanian officials expressed their optimism for what they called “a new era” for Jordanian-Iraqi relations back then.

“The agreements, the visits, the promises, the hope — they were all indicators for success, which is why it is so disappointing to see a decline rather than the expected high rise,” continued Allan.

 

The “unexpected outcome” has been attributed to the “inability of the Jordanian products to compete with its regional alternatives — not in quality but in production costs,” as put by Irbid Chamber of Industry member Zuhair Taani.

“Iraq is trying to rebuild its economy after years of war and destruction — to do that they will look for what is best for them. Jordan cannot provide them with the cheapest options because of our own struggles with the cost of production and industry. Unless we reduce our costs, we will not benefit from those agreements,” he concluded.

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