New economic and legislative reforms have been introduced in Jordan aiming at modernizing the Jordanian economy. In November 2001, a new socio-economic plan announced by the government expressed the need to improve the pace of economic reform, hence improving living conditions and creating job opportunities for the young and rapidly growing population. The suggested plan involves trade openness and integration into the globalizing world economy. Jordan, one of the most liberal Middle Eastern countries, was able to successfully join the World Trade Organization (WTO), sign a free trade agreement with the United States (US), enter into an association agreement with the European Union (EU), and improve its ties with the other Arab countries through its active participation in the Greater Arab Free Trade Area (GAFTA) in a very short period of time. Those developments are expected to enhance Jordan’s economic situation in general and its foreign direct investment in particular. The country should transform the positive outcomes of greater trade liberalization into enhanced growth, welfare, and standards of living.
Jordan joined the WTO on April 10th, 2000. It has agreed to assume all its WTO obligations upon accession. The country engaged in bilateral negotiations with 16 WTO member countries in 1999, showing interest in adopting trade liberalization policies. Jordan has signed two plurilateral agreements one on government procurement and the other on trade in civil aircraft. Jordan’s accession package includes market-access commitments on goods and services. The country had to employ major economic and legislative reforms in order to bring the Jordanian foreign trade regime into conformity with WTO requirements. Adjustments were made to many existing laws like the Intellectual Property Right law, other laws were newly introduced and some existing ones had to be replaced because they did not conform to the WTO requirements. Privatization schemes were also pursued, and Jordan promised to provide free access to foreign suppliers and investors on a wide range of services sectors. Tariff rates were lowered, ranging from 0 to 30 percent, with an expected maximum bound rate of 20 percent by the year 2010.
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