Text by Jordan FTA: The full text of the agreement. The United States and Jordan continue to benefit from a comprehensive economic partnership. A key element of these relations is the U.S.-Jordan Free Trade Agreement, which came into force on December 17, 2001 and was fully implemented on January 1, 2010. In addition, the “Qualified Industrial Zones” (QIZs) program, established in 1996 by the U.S. Congress, provides access to the United States without a product when produced in Jordan, Egypt or the West Bank and Gaza Strip, with a certain amount of Israeli content. (a) tariffs on U.S. products, provided for Category I items, are removed from January 1 of the first year, in eight equal annual tranches, and these products are duty-free from January 1 of the eighth year. b) Tariffs on Class J items for U.S. products are reduced by one percentage point per year from January 1 of the first year in the first five years of implementation. Subsequently, tariffs are reduced to five equal annual tranches and these products are exempt from duties from 1 January of the tenth year. (c) tariffs on U.S.
products for Class K items are reduced by one percentage point per year from January 1 of the first year in the first two years of implementation and remain unchanged for the next three years of implementation. Subsequently, tariffs are reduced to five equal annual tranches and these products are exempt from duties from 1 January of the tenth year. In addition, the Skilled Industrial Zones (QIZ), established in 1996 under President Bill Clinton, manufactured products made in Israel, Jordan, Egypt or the West Bank and the Gaza Strip, allowed duty-free entry into the United States. Exports must have at least 35% of their added value from Israel, Jordan (i.e. QIZ) and the West Bank or Gaza to be eligible as beneficiaries of QIZ. Jordanian exports also needed at least 8% of their added value to come from Israel. [1] The Jordanian Free Trade Agreement (FTA) was signed on 24 October 2000. It will enter into force as America`s third free trade agreement and the first with an Arab state.
The free trade agreement is the cornerstone of growing U.S.-Jordanian cooperation in economic relations, initiated by close bilateral cooperation during Jordan`s accession to the World Trade Organization (WTO), followed by the conclusion of a framework agreement on trade and investment and a bilateral investment agreement. The free trade agreement serves as an example to Jordan`s neighbours for the benefits of peace and economic reforms. Jordan has become a “clothing magnet” as U.S. companies such as Wal-Mart, Target and Hanes have set up factories to reduce costs by eliminating tariffs. In the first year, Jordan increased its exports by 213% and created 30,000 jobs. Until 2002, Jordan had a marginal trade surplus with the United States. [1] Five years after the free trade agreement came into force, Jordan`s exports to the United States had increased twenty-fold; Jordan`s clothing exports to the United States totaled $1.2 billion in 2005. [6] Most Jordanian exports to the United States come from one in 114 companies.
[7] The free trade agreement with Jordan achieves significant and comprehensive liberalization on a wide range of trade issues.
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