Jordan seeking to woo Japanese investors
Amman - Jordan and Japan are seeking to consolidate their diplomatic relations by expanding economic cooperation and facilitating mutual investments through the Japanese- Jordanian Investment Initiative.
The initiative, which principally aims to support Japanese companies expand business to Jordan, was in response to growing Japanese investors’ interest in taking advantage of Jordan’s political and economic stability.
Jordan is tenth in the region in the ease of conducting business in the “Doing Business 2018: Reforming to Create Jobs” report published by the World Bank.
“Our aim is to find and create opportunities for Japanese investors who are seeking a stable environment. Since the Jordanian market is not big enough, Japanese companies can utilise Jordan as a business hub for the Middle East and North Africa market,” said Kazuya Nakayama, president of the initiative.
“The role of the initiative is to promote business between Jordan and Japan and when we say business, we mean both ways: from Japan to Jordan and vice versa.”
Nakayama, who visited Jordan to explore areas that might be of an interest to Japanese companies such as Dead Sea products, gaming and animation, said “there are lots of opportunities for both countries.”
“Jordan has been making steady progress towards economic liberalisation while aiming to nurture internationally competitive industries and this is an excellent development,” Nakayama said.
There are 304 Japanese-affiliated companies operating in the United Arab Emirates, compared to 21 in Jordan, the Japanese official said, stressing: “We need a different strategy for Jordan from that in the UAE.”
Nakayama argued that Jordan enjoys several key characteristics, including natural resources, highly qualified, educated and well-trained human resources and advanced infrastructure in various fields, making it a favourable partner for joint projects.
“I think the advantage of Jordan is its people who know very well the MENA market and my message to the Japanese companies is why you don’t work with Jordanian companies to get into that market,” he added.
A Jordan-Japan business forum was organised by the Jordan Investment Commission and the Japanese-Jordanian Investment Initiative on the sidelines of an official visit by Jordanian King Abdullah II to Tokyo in October 2016.
The forum included bilateral meetings between Jordanian and Japanese business leaders in the information technology, animation, games industry, cosmetics and Dead Sea products, pharmaceutical, tourism and olive oil industries; 26 Jordanian businessmen and 100 Japanese participated in the forum.
“Most Japanese think that the Middle East is not safe enough to do business and changing this perception is the biggest challenge. Another challenge is to increase Japanese companies’ interest in the MENA market as their main focus at the moment is on the Asian market,” Nakayama said. “As for Jordanian companies, the biggest challenge is the determination for quality control. Japanese market expects 100% quality control; 99% is not enough.”
The World Bank report stated that Jordan had a number of economic strengths, including the ease in getting electricity, registering a property, trading across borders and, to a certain extent, paying taxes. However, the kingdom has a mixed record on protecting minority investors, resolving insolvency, enforcing contracts, issuing construction permits and securing credit.
King Abdullah recently met with a delegation representing Japan’s Toshiba Corporation that took part in the World Science Forum 2017, the largest scientific event in the region. Media reports said the Japanese company expressed interest in investing information and communications technology in the country and providing training to qualified Jordanians.
Official figures indicate that Jordan has obtained from Japan about $1.3 billion in soft loans, grants and technical assistance. Japan is the tenth biggest trading partner of Jordan in terms of volume, which is estimated at $596.2 million yearly, Global Edge said.
Earlier this year, the Jordanian Council of Ministers endorsed measures to ease doing business in the country and to stimulate the national economy in accordance with Jordan Vision 2025.
Some 307 Japanese nationals lived in Jordan as of October 2016 while Jordanian nationals residing in Japan are estimated to be no more than 155 as of December 2016.