The United Iron and Steel Manufacturing Company (UISMC) withdrew last week from the First Steel Marketing Company (FSMC), which groups the 10 largest steel and iron companies in Jordan. FSMC has been perceived by contractors, since mid-2000, as maintaining an industry cartel, fixing prices on iron and steel.
"The Ministry of Trade and Industry struck the company from the FSMC documents on Tuesday," said an informed source who declined to be named. Salem Khazalah, companies’ comptroller at the Ministry of Trade and Industry, confirmed the information. He did not identify the company, although an informed source told the Jordan Times that the United Iron and Steel Manufacturing Company had withdrawn.
However, Khaza'lah said that "a steel company sold its shares to a partner within the FSMC." Several attempts to reach UISMC officials on Tuesday were unsuccessful.
Contractors, meanwhile, continue to complain about price fixing on steel imports. "To date, the FSMC is still functioning as a cartel," said Sahel Majali, head of Jordan Construction and Contractors Association.
The wholesale price of steel rods, used mainly to reinforce concrete in the construction of buildings, climbed from 220 Jordanian dinars ($310) to JD245 per ton in 1999, but after the formation of the FSMC last year the price jumped to JD285 per ton. Contractors believe the price hike was an indicator of an emerging cartel in the country's steel and iron industry.
Meanwhile, the antitrust draft law does not seem likely to make it through the House. The Lower House Financial and Economic Committee is likely to ask lawmakers to turn down the draft and demand that the government submit a new one, said Munir Sobar, committee rapporteur.
The current draft law does not conform with Jordan's new economic situation and its new commitments to the World Trade Organization, experts said. "It is a complicated draft law which needs a number of modifications," said the deputy. The judiciary should be qualified first before dealing with this new proposed antitrust law, he added.
The antitrust draft law was supposed to be debated last summer during the extraordinary House session. "The antitrust law, when it comes into being, will be the government's tool to observe companies and their [business practices]," said Sobar. A special unit within the Ministry of Trade and Industry is likely to take the responsibility of implementing the law, once it is endorsed. — ( Jordan Times )
By Khalid Dalal
© 2001 Mena Report (www.menareport.com)
