Relations between Jordan and Iraq have warmed considerably since the ascension of the Hashemite throne of King Abdullah II over a year ago. Some see Abdullah's efforts to strengthen ties with its eastern neighbor as part of a two-fold effort to improve overall relations with the Arab world and at the same time "cool" ties with Israel. But others contend that the improvement in relationship is the result of economic necessity.
The improvement in bilateral ties is becoming ever-more above-board. King Abdullah met with Iraq's Vice President Taha Yassin Ramadan two months ago, and the king recently gave the go-ahead to the Jordanian National Mobilization Committee for the Support of Iraq to stage a spectacular public relations campaign, in which it organized the collection of 3.5 million pencils from the public and delivered them to "Iraqi schoolchildren," in an apparent violation of UN regulations prohibiting the import of graphite into Iraq.
A Jordanian delegation, headed by Minister of Trade and Industry Wasif Azar, will soon visit Iraq to boost commercial ties with the country that traditionally has been Jordan’s largest trading partner. "Our bilateral economic relations will be reviewed during the discussions," Azar said.
The key subject for discussion will be the issue of imports via Jordan's southern port of Aqaba. Iraq, which used to import most of its commodities through Aqaba, brought in only 28,482 tons via this route in the first seven months of 2000, compared to 6.8 million tons in 1988. The port's capacity is estimated at 30 million tons.
According to the Jordan Times, official figures indicate that Jordanian exports to Iraq in the first six months of 2000 comprised 26.2 percent of its exports to the Arab world, compared to 18 percent in 1999. Conversely, Jordanian imports from Iraq comprised 67.2 percent of total imports from Arab nations, which total JD290 million.
A number of Jordanian companies have indicated their intention to switch from dealing with Israel to trading with Iraq, the Chamber of Industry in Amman reported. "These Jordanian companies have asked the chamber of industry to pass on this request to the Iraqi authorities, who refuse to deal with any company that has links with Israel," Chamber of Industry Chairman Osman Bdeir said, who added that Iraq is a "more important strategic market" for them.
Jordanian business sources say that about 50 companies have conducted business with Israel since the two countries signed for peace in 1994, Middle East Wire reported. Although the company names were not released, it was revealed that they deal primarily with consumer goods.
Thus far this year, Iraq and Jordan have concluded an oil deal and trade agreement, according to which Jordanian exports worth no more than $300 million will be exchanged for 4.8 million tons of Iraqi oil. Under the agreement, Iraq will donate $300 million worth of free oil to Jordan (an increase of $50 million from last year) and will supply the remainder of Jordan oil needs at the fixed rate of $19 per barrel –currently more than 33 percent below the international market price).
Despite American efforts to pressure Jordan to cut its energy dependence on Iraq, the Jordanians are clearly planning to rely on Iraqi petroleum imports over the long term. On the drawing board is a $370 million project to construct a 700-kilometer pipeline connecting the Al Haditha oil wells along the Jordanian-Iraqi border to the Jordanian oil refinery near Al Zarqa. It will be launched next year, Middle East Intelligence Bulletin reported. Since the 1990-91 Gulf War, Iraq has exported 75,000 barrels of oil and 300 tons of gas each day to Jordan.
It is clear that closer economic ties between the two countries have political, and strategic implications. It unlikely that a oil pipeline construction project would be undertaken in the absence of a commitment to maintain warmer political ties over the long term. – (Albawaba-MEBG)
© 2000 Mena Report (www.menareport.com)
