Since King Abdullah’s 1999 ascension to the throne, His Majesty has implemented significant economic reforms to encourage foreign investment and to develop an outward-oriented, market-based, and globally competitive economy. As of May 1st, 2014, the Jordanian government passed a law to merge all investment related entities into one institution that will act as the single point of entry and reference for all investors, to promote a more coherent and stable investment environment, to support job creation, and more broadly, to support economic development. The Jordan Investment Board, the Development and Free Zones Commission, and the Export Promotion Department where merged to create the Jordan Investment Commission. United World talks to H.E. Dr. Montaser Oklah, Chief of the Jordan Investment Commission about the newly established investment promotion arm of the government which aims to increase the level of FDI in the coming years.
Since King Abdullah’s 1999 ascension to the throne, His Majesty has implemented significant economic reforms to encourage foreign investment and to develop an outward-oriented, market-based, and globally competitive economy.
As of May 1st, 2014, the Jordanian government passed a law to merge all investment related entities into one institution that will act as the single point of entry and reference for all investors, to promote a more coherent and stable investment environment, to support job creation, and more broadly, to support economic development. The Jordan Investment Board, the Development and Free Zones Commission, and the Export Promotion Department where merged to create the Jordan Investment Commission.
United World talks to H.E. Dr. Montaser Oklah, Chief of the Jordan Investment Commission about the newly established investment promotion arm of the government which aims to increase the level of FDI in the coming years.
First, I would like to start this set of questions by getting your insights on the evolution of the regulatory framework when it comes to attracting foreign investments into the Kingdom of Jordan.
Thank you very much for giving me this opportunity; it is an honor for us to be featured within this special report in the context of USA Today. First of all allow me to highlight the importance of FDI for Jordan. Jordan is a small country with very limited natural resources. Its most valuable resource is its educated and professional labor force that seems to be of a special nature in terms of their productivity and their commitment to their work environment. To capitalize on this resource, Jordan started the process of regulating the attraction of foreign direct investment early on during the mid-1990’s onwards, when Jordan had adopted a policy that sought to liberalize and open up the economy. To that effect, the foreign direct investment element became a priority for us, and that is when we started with our investments laws, the modern ones.
Prior to that we had the traditional type of investment laws oriented to domestic industrial investment, because foreign investment was not a priority at that point. From the 90’s onward, the Government of Jordan recognized the importance of FDI, and attracting investments became a priority, and we’ve started with the Investment Promotion Corporation that was governed by a law which was enacted back in 1995. Since then, the Government has sought on several occasions to improve and modernize the legal framework that surrounds the FDI promotion, the most recent being the Investment Law of 2014, which was enacted by Royal Decree on October 16th of 2014.
The new law endowed the Investment Commission with the authority and flexibility to cope with the dynamic needs and requirements of foreign investors. So I see this Commission as a body that is capable, because of its dynamism in terms of legal structure and governance elements, not only to cope but to meet the emerging needs of investors. The Investment Commission will not only unify all investment promotion entities, but also all investor servicing entities that include registration and licensing and aftercare services. We envision, in the context of this law, a new Investment Window being created that will add to the authority of the Investment Commission in terms of being responsive and spontaneous to the needs of the investors. In addition to this comparative advantage that has been made to the Commission’s ability to deal with investors, another body has been added to the commission; the Development Zones Authority; which boosts the flexibility and competitiveness of the Commission in terms of developing the necessary legal framework for the realization of high value or strategic investments.
So, within the context of this law, JIC is able to initiate new economic zones that are tailor made to the needs of investors. Not only in terms of administrative procedures but in terms of legal and financial aspects too. In terms of the legal, administrative and financial requirements of the investors we are capable of getting the approval of the Investment Council (which is chaired by the Prime Minister) that helps in devising the necessary investment policies investors need. We have come a long way and we have reached a stage in which we’re able to respond spontaneously, efficiently and effectively to the needs and requirements of the investor.
His Majesty King Abdullah II set the Investment Commission as a top priority for the national strategy for 2015. You mentioned before the Investment Window to be launched in April 2015, can you explain the readers of USA Today how it differentiates from the one stop shops that the Jordan Investment Board set in previous years?
The one stop shop concept, globally speaking, has rarely ever succeeded in its entirety. It is difficult to bypass the whole government system and create a single place where all the approvals are granted on the spot. There is another concept that has proven to be much more effective which is the one stop service, whereby you go to one place and you get all the services that you need related to the different government bodies that are of relevance to your investment activity.
We would not be satisfied, in the context of this law, just with granting a service. We wanted to give it more authority. Now, the way we're proceeding with the Investment Window (we don't call it a "one stop shop" but Investment Window) which enables the Commission to provide, in accordance to the prevailing rules and regulations, all the necessary approvals to the investor within 30 days. We have also institutionalized within this law the necessary mechanisms to grant the necessary approvals via an electronic system, so the investor would not need to come physically to apply for an investment project, it can be done on our website. This electronic system will enable the project, subject to its classifications, to go to the concerned authorities in order to grant the necessary approvals within the time frame settled, which is of 30 days. This electronic investment window is going to work in parallel with the physical one and it will also operate in the same way but with the ability of superiors within the different entities to track where investment are being withheld and not being attended. So, accountability in this context will be extremely high and visible.
Following my audience with His Majesty the King, and my briefing to the Council of Ministers, I was very pleased to get their full support and acknowledgement that the Jordan Investment Commission is the one and only reference point for investors. As an investor, you do not have to go anywhere else except to the JIC, and the JIC has been mandated with its law to take care of all your needs, before the investment process, during registration and after the investment is realized.
One of the main priorities of the Investment Commission is the international promotion of Jordan as a safe destination for investors. What are your main priorities when it comes to the actual promotion of the country? And, subsequently, which are the different investment opportunities the Kingdom has to offer to any potential investor?
Jordan is very rich when it comes to investment opportunities despite being surrounded by conflict. The political turbulences around us are really making investors shy away from our region, and I don’t blame them. Security is essential for business. But looking at Jordan, you will find that it is an island of stability, a safe haven within a very turbulent region. We will work on becoming even more attractive by providing them with a system that makes it worthwhile taking advantage of and nurturing their investments plans with Jordan.
What are our priorities? Well, there are several sectors that present themselves as golden opportunities for investors; for example the tourism sector is very vibrant and there is a demand for hotels, resorts and spas; in terms of renewable energy there is a huge development zone that has been established in the Southeast of Jordan, where huge investments are being made in renewable energy, this is of particular importance since Jordan’s energy strategy heavily emphasizes renewable energy sources. Also the pharmaceutical industry, for example, is one key industry that is excelling not only in Jordan but also regionally. Closely related, is the medical tourism and healthcare sector, where Jordan remains the number one destination for medical tourism in the region. Real estate is a sector that, with the opening of the Boulevard project, has also become a flagship for Jordan in terms of foreign direct investments. Again, our priority is to target investors in specific sectors.
With your international experience, what are your personal objectives during your mandate at the Jordan Investment Commission?
My first objective is to rebuild confidence in our investment promotion institutions, and to change the negative image with which we have been bombarded as a result of bureaucracy, lengthy procedures and out of date legal framework. I must admit that we have had a very strong start; and with a very clear vision as to where we are and what we want to achieve. Once, the Prime Minister told His Majesty in front of me: “I haven’t seen a person in the Government of Jordan with the ability to analyze clearly, identify the challenges and find the solutions just like this man. And what tops all of that is his sense of integrity and honesty and sincerity about the work.” That was the best compliment I can receive from the Prime Minister in front of His Majesty. One thing that I would like to confess here is that I am a person with a heart. I make decisions and I don’t shy away from difficult decisions.
What is the importance of the United States for the Kingdom of Jordan? Does everyone know the huge aid the United States has been providing Jordan within recent years?
First of all I have been educated in the US, and as a diplomat, I can attest to the strategic value of our special relationship with the US. Jordan has a lot to gain from such a partnership not only in terms of trade but also in terms of economic development, prosperity, development of human beings, in addition to the political support and cooperation. Jordan’s free trade agreement with the US is one of the most important advantages businesses in Jordan enjoy, and it is a direct result of the economic cooperation between our two countries. Our partnership has proven to be a successful through our trade figures, or through the number of students that have been educated in the US, or if you look at the technologies that have been transferred from the US. But there is one place we have lagged behind -and I hate to use the word failed in it, which is the amount of investments that we have been able to attract from US businesses into Jordan. It is still way below the desired level and there is a lot of room for improvement.
There are opportunities that the US businesses can benefit from and take advantage of, not only for the sake of the Jordanian economy, but for the sake of the regional economies, like Syria and Iraq which are still having problems with the ISIS and others-, the Gulf as well as Northern Africa. Jordan remains the only body or hub that enables investors to access all of these economies in a very credible, safe, and secure manner. I cannot think of any other Arab country that has this level of accessibility given the regime that we have and the credibility of the regime, vis-à-vis the Arab states. Many American businesses have located here with the Iraq market in mind and they have been very successful and profitable. We don’t want this to be a temporary arrangement; we want this to be a sustainable arrangement for American businesses, not only regarding the Iraq market and the reconstruction efforts, but to utilize Jordan as a gateway for the region. We live in a very dynamic region that brings about opportunities in no time and those that are in existence in this region will be the first to rip such rapport benefits and to collect the ultimate fruits of such opportunities as they evolve and as they become available.
What motivates you to take the Jordan Investment Commission to new levels of success? What are the things you are going to implement every single day for the next couple of years?
What motivates me is my clear conviction and commitment to the values and principles that Jordan is standing for, vis-à-vis our region and vis-à-vis the globe. Our leader His Majesty King Abdullah II is the model we follow. He has been seen by the World as a moderate Muslim, one that strives for peace, stability, security, fairness and equality worldwide. To that effect, he is my primary motivation. I also dearly love my country, and my commitment to improve the state of my country drives me to exert my utmost effort in putting Jordan on the global investment map.
10 Fintech 101
When being part of a generation on which the flag of entrepreneurship seems to be constantly waving in the sea of young professionals looking to succeed in the business world, more often than not, we tend to drown in the... Read More