TEXTILE DIVERSIFICATION CHALLENGES IN JORDAN

UNCLAS AMMAN 006469 SIPDIS SENSITIVE STATE FOR NEA/ARN AND EB - BOB BOYNTON STATE PASS USTR FOR NED SAUMS AND DOUG BELL STATE PASS USAID FOR TOM OLIVER USDOC FOR 4520/ITA/MAC/ONE/P.THANOS E.O. 12958: N/A TAGS: KTEX ETRD EINV JO SUBJECT: TEXTILE DIVERSIFICATION CHALLENGES IN JORDAN REF: SECSTATE 160692 Sensitive but unclassified; please protect accordingly. ¶1. (U) Embassy Econ staff and USAID Jordan have maintained an extensive and productive dialogue with Jordan's government and private sector along the lines of reftel recommendations since the inception of the QIZ initiative in 1998. The GOJ in particular is eager to see Jordan's industrial base expand and diversify, recognizing that tying too great a percentage of the kingdom's growth and employment to one sector would be imprudent. ¶2. (U) The GOJ, in partnership with key players in Jordan's private sector and with the support of the Mission, has worked particularly hard over the past ten months to maximize the potential benefits of the U.S.-Jordan Free Trade Agreement. As highlighted reftel, JUSBP's Export Fast Track Action Plan (EFTAP) has already helped develop Jordanian export capacity in a wide range of industries including marble and stone, air conditioning units, paper products, and cosmetics. JUSBP is also working actively with Jordanian companies in specialty foods, olive oil, and grain processing. That said, Jordan maintains a strong interest in sustaining its nascent textile sector in a competitive global market through bolstering the sector's competitiveness. ¶3. (SBU) One such mechanism to do so is TRIDE (Trilateral Industrial Development),a program utilizing U.S., Israeli, and Jordanian funds to jointly develop industrial R&D projects. TRIDE could help Jordanian companies explore and develop new technologies. In fact, two TRIDE success stories were the development of an Arabic software program and a network management solution. ¶4. (SBU) The GOJ and private sector are aware of TDA and OPIC facilities. TDA has been utilized here with some success, including most recently to carry out a feasibility study for an independent power project in the kingdom. Jordan's experience with OPIC has been unimpressive to date, due in large part to a local management team that lacks motivation. OPIC managers from the U.S. are reviewing the program here, and we expect the OPIC facility to become more robust in the coming months - a development that will be welcome to a Jordanian government keen on attracting new investment. GNEHM