The Jordan -United States Free Trade Agreement (JUSFTA), in force since December 17, 2001, provides for the gradual elimination of duties and removal of commercial barriers on trade in goods and services between Jordan and the United States over a period of ten years, thus leading to a complete free trade area between the two countries by January 1, 2010.
The JUSFTA enhances the environment for business practices by ensuring the protection and enforcement of intellectual property rights and the application of trade-related environment and labor practices. The Jordan – US FTA is based on flexible rules of origin and provides Jordan with the opportunity to develop its e-commerce infrastructure, which is considered the most competitive FTA-related advantage in the Middle East region. The agreement is fully WTO-compliant and reflects the commitments, obligations, and market access rights of both countries to the international trade community.
The Agreement reflects the strong historic relations between both countries; it presents Jordan with the opportunity to protect its balance of payments (through increased US exports and US-related investment), while providing the US access to new international markets and provides for bilateral safeguarding measures, dispute settlement, and joint consultation mechanisms
Creating Opportunities for Trade and Investment in Services and
Manufacturing
The JUSFTA opens the door for outstanding business opportunities and acknowledges an increasingly attractive market for global trade and investment in the manufacturing and services sector of the economy. Jordan’s strategic central location in the Middle East; its good infrastructure, human resources, regulatory environment, and advantageous trade agreements with the US, Europe and the Arab World position Jordan as a leading regional hub for U.S. – Middle East trade and investment activity.
Jordan today is an attractive location for investments in IT, securities and financial services, education, healthcare and religious tourism, engineering and mechanical industries, automobile design and manufacturing, precious stones and jewelry, furniture and cosmetics industries.
Due to competitive manufacturing costs and flexible industrial policies, Jordan is expected to enjoy a competitive advantage in consumer product manufacturing under the JUSFTA until 2015, 2 years after the proposed Middle East Free Trade is implemented.
Additional opportunities in data transmission services, telecommunications, and distribution provide international investors with a competitive edge to pursue a business base in Jordan for region-wide business ventures.
Liberalization of Trade in Goods & Services
The FTA provides for a ten-year transitional period, during which duties on virtually all goods originating in Jordan and the United States will be eliminated. Under the JUSFTA, tariff elimination started on January 1, 2001 and will lead to a free-tariff regime by 2010. Starting January1, 2005, about 96 percent of tariff elimination between Jordan and the United States was implemented.
In services, Jordan and the US undertook specific market-access commitments on all four modes of supply in various service sectors, such as business, communications, engineering and construction, distribution, education, environment, finance, health, tourism, recreation, and transportation. Jordan’s services sector provides US and international investors ample opportunities in trade-related activities, especially in logistics, communications, and online education.
Rules of Origin
Under the JUSFTA Rules of Origin provisions, goods originating from Jordan or United States are eligible for preferential treatment provided they comply with the 35% local value added requirement, while allowing for an amount not exceeding 15% content from the other party to be counted towards the 35%.
Trade Related Intellectual Property Rights
The JUSFTA provides protections for trademarks and geographical indications, copyrights, and patents, and specifically mentions the protection of software and pharmaceuticals, two categories of products whose copyrights and patents are especially prone to violation.
As part of its trade commitments, Jordan ratified the World Intellectual Property Organization (WIPO) Copyright Treaty which entered into effect in April 2004 and amended the Jordanian Copyright Law to include provisions of the WCT. The WIPO Phonograms and Performers Treaty (WPPT) was ratified and came into effect in May 2004. These treaties supplement the substantive standards for protection in the TRIPS Agreement and take into account the advent of the Internet. On patents, Jordan will join the PCT before the end of 2005.
Opportunities for E-commerce
Jordan and the US have committed to promoting a liberalized trade environment for electronic commerce. This commitment encourages investment in new technologies and stimulates the innovative uses of networks to deliver products and services. Electronic transmissions are duty-free between both countries, and trade in digitized products is strongly facilitated through the JUSFTA.
Environment & Labor
The United States and Jordan have committed to strive to maintain high levels of environmental protection and to improve their environmental laws. Both countries agreed on an environmental cooperation initiative, which establishes a U.S.-Jordan Joint Forum on Environmental Cooperation for ongoing discussion of environmental priorities, and identifies environmental quality and enforcement areas of initial focus. Jordan and the United States reaffirmed their obligations as members of the International Labor Organization (ILO) and their commitments under the ILO Declaration on Fundamental Principles and Rights at Work and it’s Follow-Up.
The Qualified Industrial Zones and the Jordan US-Free Trade
Agreement Enhanced Two-Way Trade between Jordan and the United
