Jordan: Billions in Development Deals
To those who balme iraqis for teh increase in cost of living, think twice. Emaar is following damac and al hariri in big investments, and it is just the beginning for emaar
Jordan: Billions in Development Deals Press Release
24 May 2007
Jordan recently signed $2.5bn worth of development deals focussing on areas as varied as energy, transport, infrastructure and finance. The agreements, made with a wide range of companies ranging from around the region to as far afield as China and Ireland were made in mid-May at the fourth World Economic Forum (WEF) on the Middle East, which was hosted by Jordan at the Dead Sea.
Among them, there were several significant industrial investments signed for anchor tenants in the logistics and light industry King Hussein bin Talal Economic Zone in Mafraq, for a total investment of over $114m. The occupants-to-be include companies involved in cable and air conditioning manufacturing as well as a logistics centre and warehouse area.
Similar agreements were made for the newly established Irbid Economic Zone that is being designed to concentrate on healthcare, education and information technology. A deal to establish a $35m nursing college and another for Jordan Telecom to provide communication services in the zone were made at the same time.
The tourism sector was also the focus of significant private sector investment with Emaar Properties of the United Arab Emirates leading the way in announcing a deal with a number of regional investors worth $500m for the development of the Samarah Dead Sea Golf and Beach Resort. This was followed by fresh news from Jordan Dubai Capital (JDC) regarding its plans for the $50m Munya Woodland Resort and Spa project in the Dibeen nature reserve, north of Amman, which will be developed in co-ordination with the Social Security Investment Unit.
According to Samir al-Rifai, the chief executive of JDC, This project will largely contribute to developing local communities in the north in terms of providing new economic opportunities. It will also ensure the protection of the environment, woods, plant cover and the overall ecosystem of the forest. The resort will have a 40-room eco-friendly hotel as well as 50 residential units and a market selling local products.
Such agreements are seen as an example of Jordan's dedication to attracting investment from various sources. King Abdullah said, Today's agreements reiterate our commitment to strengthening our economy through private sector-led investment and growth, as well as our commitment to cross-border partnerships.
The country is also set for a number of investments to upgrade its infrastructure. Perhaps the most high profile of these projects is the expansion plans for Queen Alia International Airport. The consortium led by Aéroports de Paris Management, which includes five other international companies, won the contract for the expansion and operation of the airport earlier this month. At the WEF, they announced that the scale of their investment would be $550m.
At the same time, a Chinese, Jordanian and Pakistani consortium put ink to a contract announced earlier this month for the construction of the Amman-Zarqa light rail project. The $240m deal will see the construction of a 25-km rail link between Raghadan in Central Amman and New Garden City in Zarqa. Part of the route will use the existing Hejaz railway alignment between Al Mahatta and New Zarqa. There are also plans for the potential extension of the line to other parts of Amman. The project is designed to cut down the congestion and traffic flows on this busy commuter corridor.
In other infrastructure developments, a Jordan Dubai Energy-led consortium acquired a 51% stake in the $645m Central Electricity Generating Company (CEGCO), marking the first step in the privatisation of the Jordanian energy sector. This was purchased through Energy Arabia, a company established by JD Energy, the energy investment arm of JDC. The government will retain a 40% stake in CEGCO while the Social Security Corporation will take the remaining 9%.
With Arab and world leaders already present, King Abdullah hosted a meeting of the newly established G11 countries on the sidelines of the forum. The G11 is an organisation aimed at relieving the debt burden of its developing member nations. Launched last year in Jordan, it includes Croatia, Ecuador, El Salvador, Georgia, Honduras, Indonesia, Jordan, Morocco, Pakistan, Paraguay and Sri Lanka.
Participants discussed ways to bring closer co-operation between the G11 and the G8 body of the most industrialised nations. The group identified specific initiatives that can serve as a practical, targeted start-up for G8 and G11 co-operation. These include investment in infrastructure, support for small- and medium-sized enterprises, scientific research and development, and technology transfer. The summit also highlighted four other areas for international support and co-operation. These were debt burden alleviation, investment promotion, trade and development and targeted grant assistance.
As well as being significant vehicles for promoting Jordan on the international stage, the WEF and G11 have brought the kingdom welcome exposure and a substantial portfolio of overseas investments.