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