Food to Jordan

(Last updated: 16 Jul 2007)

Trends and opportunities

The market

Food imports (including live animal imports) account for 18.4 per cent of Jordan’s of total imports. Meat products account for approximately 15 per cent of the total food imports and dairy products 8.5 per cent. Dairy and meat products are staples in the Jordanian diet.

Water shortage is ongoing constraint for Jordanian agriculture production. Annual production fluctuates according each year’s rainfall but even at best, Jordan remains a net food importer. Wheat and barely are the major crops.

Many of Jordanian households, including urban households, maintain fruit and vegetable gardens and keep poultry and goats. Household plots are, on average, approximately ten square metres and the produce raised includes grapes, figs, olives, apricots, apples, pears, citrus fruits, cucumbers, spinach, onions, garlic, and herbs.

Jordan is a major wholesaler and distributor of food and agricultural commodities to countries in the region and especially to neighbouring Iraq. Jordan is politically stable with a safe security environment along with an efficient banking system and modern currency trading policies. To encourage Jordan’s growth as a regional trading hub, the government established the Aqaba Special Economic Zone, a duty-free centre for export-orientated activities, that provides incentives to business including taxation concessions. Jordan is progressively aligned itself to free trade reforms and agreements.

Opportunities

The best opportunities for Australian suppliers are in meat and dairy products. Australian suppliers account for 98 per cent of live sheep and cattle exports to Jordan. Australia’s reputation is enhanced by the absence of mad cow disease and foot and mouth disease which have been prevalent in competitor markets. Jordan is continuing to expand its abattoir capacity; Jordan consumers prefer the reassurance of the local slaughter of animals in the halaal method.

Jordan is continuing to develop dairies and feedlots, which require appropriate grain and oilseed feed supplies. Dairy products remain an opportunity for Australian suppliers even as Jordan increases domestic production.

Jordan imports many agrifood commodities such as wheat, corn, barley, rice, legumes, sugar, and soybean meal.

Competitive environment

The USA is Jordan’s largest trading partner. There has been strong competition between the USA, the EU and Ukraine for grain sales in recent years.

Tariffs, regulations and customs

Customs tariffs are based on the Harmonized System coding practice. Commodities mostly fall under one of five different tariff rates: zero; five per cent; 10 per cent; 20 per cent; and 30 per cent.

The exceptions are: tobacco and alcoholic beverages which are subject to a tariff range of 50–180 per cent; and unwrought gold which is subject to a 0.5 per cent tariff rate.

In addition to customs duties, both imported products and locally produced goods are subject to a 13 per cent value-added tax. Some imports and locally produced goods (eg. electrical appliances and passenger vehicles) are subject to supplementary sales tax, while others are fully exempt.

The tariff schedule and the general sales tax law may be accessed at the Jordan Customs Department website.

Pre-import clearance is required for certain goods. The clearance, once obtained, acts as an import license. These clearances are not automatic. Relevant pre-import license-issuing agencies and the respective goods include:

• Ministry of Industry and Trade ­– flour and its by-products (given out in the form of import licenses)
• Ministry of Agriculture – frozen animal semen, live animals, fresh/chilled/frozen meat, embalmed wild animals, imported milk products (not required for import of dairy products from countries with which Jordan has concluded a bilateral trade protocol)
• Agricultural Marketing Corporation – potatoes, onions, garlic, fresh fruit and vegetables (not required for import of fresh fruits and vegetables from countries with which Jordan has concluded a bilateral trade protocol)

All Jordanian and foreign trading companies must either obtain an importer’s card from the Ministry of Industry and Trade for customs clearance purposes, or pay Customs a fee equivalent to five per cent of the value of the imported goods

Industry standards

The following information must be written (or a sticker placed across) in Arabic on the original package of every product entering Jordan:

• Ingredients
• Production and expiry dates
• Size/weight of the product
• Country of origin

Marketing your products and services

Market entry

An agent responsible for distribution and the implementation of all marketing activities related to the products is the best strategy to enter the food industry in Jordan.

Joint ventures are another method of entering the market, ensuring that the partner has the adequate experience and means to effectively service the market. There are some areas of business where foreign ownership cannot exceed 50 per cent.

Advertising in Jordanian media is an effective means to reach buyers and/or agents and distributors.

Participating in (or conducting) exhibitions, workshops or product demonstrations for local traders have been successful for suppliers entering the market.

Australian companies considering setting up a local office or operation should consider the benefits of locating in the Aqaba Special Economic Zone. Incentives in the Aqaba Zone include:

• Exemption from annual property taxes
• Exemption from social security charges
• Custom duty and tariff concessions
• Income tax rate concessions (five per cent as opposed to the normal 35 per cent)

The government has focused on minimising the bureaucratic burden on business and expediting customs processing. Businesses are afforded 50-year land leases which, in certain circumstances, can be extended to 100 years.

There are designated ‘free zones’ in other parts of the country, aimed at servicing specific sectors and industries.

Distribution channels

Local agents and joint venture partners are the primary distribution channels for food products and commodities.

Transport

Most imported products arrive in Jordan by sea freight through Aqaba Port, Jordan’s only access to the sea. Aqaba Ports Corporation is the official body that manages and supervises all port activities.

Only two (non-connecting) sections of the Hejaz railway still operate:

• Ma’an to the Aqaba Port
• Amman (in Jordan) to Damascus (in Syria)

Jordan has well-establish cargo road transport services and, supported by shipping agents and clearing firms, is a traditional supplier of trucking transportation to other countries in the region. The road network consists of 8000 kilometres of surfaced roads. There are two major highways from the north border with Syria to Amman, continuing south to the port of Aqaba and southeast to Saudi Arabia, and upgraded or new highways going east from Amman to Iraq and west towards the West Bank and Israel.

Amman’s Queen Alia International Airport is Jordan’s main passenger and air cargo facility. Aqaba Airport (also known as King Hussein International Airport) services international flights and has some air cargo capacity.

Links and industry contacts

Government, business and trade resources for Jordan

National Information Centre – www.nic.gov.jo

Ministry of Industry and Trade – www.mit.gov.jo
Ministry of Planning – www.mop.gov.jo

Central Bank of Jordan – www.cbj.gov.jo

Jordan Customs Department – website www.customs.gov.jo

Department of Statistics – www.dos.gov.jo

Jordan Investment – www.jordaninvestment.com

Jordanian Businessmen Association – www.jba.com.jo
Amman Chamber of Industry – www.aci.org.jo

Federal Jordan Chamber of Commerce – www.fjcc.com

Media

The Jordan Times ­– www.jordantimes.com

Australian resources

Australian Embassy
3 Youssef Abu Shahhout
Deir Ghbar
Amman
Tel: (962) 6 5807000
Fax: (962) 6 5807001

Opening hours:
8.00 am to 3.30pm, Sunday to Thursday

Embassy of the Hashemite Kingdom of Jordan
20 Roebuck St
Red Hill ACT 2603
Tel: (02) 6295 9951
Fax: (02) 6239 7236

Contact details

The Australian Trade Commission (Austrade) is the Australian Government’s trade and investment development agency, operating as a statutory agency within the Foreign Affairs and Trade portfolio.

Austrade assists Australian businesses contribute to national prosperity by succeeding in trade and investment, internationally, and promoting and supporting productive foreign investment into Australia.

Austrade:

• Delivers services that assist Australian businesses initiate, sustain and grow trade and outward investment.
• Promotes Australia as an inward investment destination and, with the States and Territories, supports the inflow of productive foreign direct investment.
• Administers the Export Market Development Grants scheme.
• Undertakes initiatives designed to improve community awareness of, and commitment to, international trade and investment.
• Provides advice to the Australian Government on its trade and investment development activities.
• Delivers consular, passport and other government services in designated overseas locations.

A list of Austrade offices (in alphabetical order of country) is available.

More information

For further information please contact Austrade on 13 28 78 or email info@austrade.gov.au

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