Discusses key economic indicators and trade statistics, which countries are dominant in the market, and other issues that affect trade.
The United States and Jordan enjoy a strong bilateral relationship, underpinned commercially by the U.S.-Jordan Free Trade Agreement (FTA). Since the signing of the agreement in October 2000, bilateral trade has surged over 800 percent, expanding commercial opportunities for U.S. and Jordanian businesses. The FTA gradually eliminated duties on nearly all products by 2010, and includes provisions for trade in services, electronic commerce, intellectual property protection as well as labor and environmental standards. In 2021, bilateral trade of goods and services reached $5.174 billion. U.S. goods and services exports to Jordan accounted for $1.841 billion of which goods and services exports were valued at $1.203 billion and $638 million, respectively.
Unlike its neighbors, Jordan does not have many natural resources, although potash and phosphate mining are among the country’s core industrial sectors, in addition to the manufacture of garments/apparel, chemicals and pharmaceuticals. Jordan is largely reliant on imports across a range of industry sectors, creating opportunities for U.S. exporters. In 2021, Jordan imported $23.34 billion in goods and services, compared to exports valued at $13.85 billion. Jordan’s leading import categories include mineral fuels and crude oil, industrial machinery, transportation equipment including automobiles, electrical and electronic equipment’s, food and agricultural products, textiles, manufactured goods such as rubber products, paper and cardboard, yarns, chemicals, clothing, and footwear. In 2021, Jordan’s leading sources of imports included: Saudi Arabia (14.9%), China (14.5%), United States (6.4%), EU (18.7%), United Arab Emirates (6%), Egypt (3%) and Turkey (3%). The country’s top export categories include chemicals, fertilizers, pharmaceuticals) textiles, mineral products (including potash and phosphates) and vegetable products.
Jordan is one of the smaller economies in the Middle East, with foreign assistance an important component of the $45.371 billion economy. The United States is the single largest contributor of bilateral assistance to Jordan, providing $1.65 billion in 2021. Additionally, in September 2022, the United States signed the fourth MOU on Strategic Partnership for $1.45 billion per year in bilateral foreign assistance to Jordan from 2023 to 2029. The country faces a range of economic challenges: government debt equals 114 percent of GDP, the national budget deficit in 2021 was $2.444 billion, and unemployment at 24.1 percent (and as high as 50 percent for young adults under 30 years old). Additionally, after years of economic growth ranging from four to nine percent in the early 2000s, Jordan’s economic growth has slowed significantly since 2008.
In 2020, Jordan’s economy contracted by 1.6 percent due to the COVID-19 pandemic, exacerbating economic weaknesses. Government measures to mitigate the spread of the virus curbed business activity, contributing to a further uptick in unemployment and a decline in export-import activities, as well as inbound tourism. The economy grew by 2.2 percent in 2021, and economic growth in the near term is expected to be similarly sluggish.
Summary of the top reasons to do business in Jordan:
Bilateral Relationship Favorable for U.S. Business Development. The bilateral relationship between the United States and Jordan spans more than 70 years. The U.S.-Jordan FTA enables nearly all U.S. exports to enter Jordan duty-free.
Reliance on Imports. Jordan is highly reliant on imports, creating opportunities for U.S. exporters across a range of industry sectors that are prepared for global competition.
High Regard for U.S. Products. U.S. goods, services, and technologies are well-regarded for superior quality and performance.
Infrastructure Projects and Government Procurement. Emerging opportunities exist to engage in major infrastructure projects or pursue government tenders across a range of sectors, many of which are financed by donor countries including the United States or International Finance Institutions (IFIs). A pipeline of projects is coordinated through the Ministry of Investment’s Public Private Partnership (PPP) Unit.
Political Stability & Strategic Regional Platform. Jordan offers political stability for business interests in the Middle East and is one of only six Arab countries to have concluded a peace agreement with Israel. U.S. firms can leverage the country’s international business community. Jordan is strategically positioned to serve as a platform for firms supplying regional markets or seeking access to the Iraqi market.