US embassy cable - 03AMMAN3099

C O N F I D E N T I A L AMMAN 003099 
 
SIPDIS 
 
STATE PASS USTR FOR DOUG BELL 
 
E.O. 12958: DECL: 05/22/2013 
TAGS: ETRD, ECON, EINV, JO 
SUBJECT: MIDDLE EAST TRADE INITIATIVE ASSESSMENT - JORDAN 
 
REF: A. STATE 135263 
     B. AMMAN 2786 
 
Classified By: Ambassador Edward W. Gnehm, reasons 1.5 (b,d) 
 
1.  (c)  Senior Jordanian officials issued strongly 
supportive statements both in public and in private following 
the President's May 9 announcement regarding the Middle East 
Trade Initiative.  In comments repeated privately to the 
Ambassador (ref b), Planning Minister Bassem Awadallah told 
the Jordan Times he welcomed the move, and expressed hope 
that the initiative would stimulate long-dormant inter-Arab 
trade.  When asked his views about Jordan losing its "special 
relationship" with the U.S. as the only Arab country with an 
FTA and QIZ status, Awadallah noted that "the age of 
mercantilism is over,", and reiterated that any initiative 
that enlivened the regional economy would be to Jordan's 
benefit. 
 
2.  (c)  Trade Minister Salah al Bashir has made similar 
remarks in meetings with Emboffs, going so far as to say that 
an FTA for Egypt would be "the best thing" for Jordan.  He, 
like Awadallah, believes that the initiative should increase 
economic growth and activity both within the region and with 
the U.S., and concludes that prosperous neighbors will offer 
the best opportunities to create a more prosperous Jordan. 
 
3.  (c)  These initial reactions indicate strong support for 
the President's initiative.  As a country that has made 
significant progress, often at great political risk, on its 
economic reform agenda, Jordan already benefits from most of 
the programs on offer through the initiative.  The GOJ will 
hope to play a leadership role in helping to roll out the 
initiative, and may even want to offer technical assistance 
to other countries in the region that need to upgrade 
legislation or procedures.  To that end, the GOJ might 
support programs under the initiative that factor in 
capacity-building opportunities for rejuvenating inter-Arab 
trade.  Jordan would likely be particularly interested in 
docking agreements and cumulation clauses that would spur 
trade with other countries in the region. 
 
4.  (c)  While we expect strong support from Jordan for this 
initiative, we also expect some degree of sensitivity.  The 
GOJ will expect new beneficiaries of U.S. preference programs 
and agreements - whether QIZ's, FTA's, BIT's, or assistance 
with WTO accession - to be held to the same high political 
and economic standards to which Jordan was held in 
negotiating its own agreements.  Thus, for example, they will 
expect any new QIZ agreements to require 11.7% Israeli 
content in finished goods, the highest (i.e., "TRIPS-plus") 
protections for intellectual property rights, especially in 
the pharmaceutical field, and minimal product category 
exclusions for tariff reduction schedules under new FTA's. 
If it appears that neighboring countries are getting "easier" 
terms, the GOJ will argue vociferously that other countries 
should have to meet the same standards that Jordan attained 
when it secured its original agreements. 
GNEHM