Industrial Developments Horizons in Jordan

Jordan - 19 November 2012

The aim of this study is to investigate Jordan’s industrial performance after its accession to the WTO in 2000 and the completion of its commitments to liberalize commodities trade in 2010.
Key manufacturing performance indicators have been measured for total manufacturing and subsectors as presented in the industrial surveys according to the ISIC system at 4 digit level. Performance has been assessed and analyzed in the context of the reduction in import tariffs.
The results showed that a total growth has been registered in 2008 over 1999 for the following indicators: 84 percent for profit margin, just 1.9 percent for real wage per worker, 28.5 percent for real labor productivity, 42.5 percent for exports/gross output ratio and 53.5 percent for employment.
Accordingly, we can conclude that growth in profit margin was at the expense of labor returns. Also, in spite of the moderate achievement in labor productivity, it has not been matched by a similar rise in real wage per worker, which remained constant. It seems that Jordan’s targeting of industry to seriously participate in solving the unemployment problem and improving the workers standards of living have not been met yet.
The growth in 84 industrial subsectors’ indicators was measured, and these industries were classified into four groups: At risk, adjusting, successful and “low or declining productivity” industries.
Some industries had faced severe import competition due to the low level of tariffs and protection, such as dairy products, soap and detergents, plastics, pesticides, tools for special purposes, machinery for food processing, and machinery for construction. These industries may need some support to improve their position. This can be done through non-tariff barriers of trade, indirect measures to enhance productivity growth and lower costs such as R&D and export marketing programs.