Jordan is moving with confidence toward creating an attractive and stimulating investment environment for strategic projects in the green hydrogen and ammonia sector, as part of its efforts to reinforce its status as a regional hub for the trade of this fuel, despite growing competition in the region.
اضافة اعلان
Recent Cabinet decisions to approve a package of incentives for green hydrogen projects outside the Aqaba Special Economic Zone come within Jordan’s vision to be among the first countries in the region to produce, use, and export green hydrogen.
The sector enjoys strong support from His Majesty King Abdullah II, who consistently emphasizes the importance of expanding renewable and green energy, including green hydrogen, as a key opportunity to accelerate the shift toward clean and sustainable energy.
The new incentives include reducing income tax to 5 percent, plus a 1 percent national contribution; exempting all project equipment and fixed assets, including those imported by the project-owning company, the main contractor, or subcontractors, from customs duties, applicable taxes, and import fees; as well as exempting spare parts needed for the project from such fees.
They also exempt project companies from stamp fees and other charges on project agreements, financing contracts, supply and installation contracts, and any additional agreements required for implementation. Furthermore, exemptions cover general sales tax and any other applicable taxes on both local and international services, in addition to goods and materials necessary for project execution.
The incentives grant projects eligibility for any future tax exemptions accorded to industrial projects, exemption from withholding tax on imported services, and a grace period of up to five years before lease payments on state-owned land must begin, pending the project’s operational start.
Additionally, during the project agreement’s term, or any extension thereof, non-resident lenders will not be subject to taxation in Jordan—such as withholding, collection, or retention—on income from interest, fees, or other payments arising from loans extended to project companies under relevant financing agreements.
According to the Cabinet decision, these incentives are expected to attract high-value investments, create direct and indirect job opportunities, localize green energy industries such as green ammonia production, and enhance Jordan’s role as a regional clean energy hub. They are also designed to improve the profitability and feasibility of green hydrogen projects, thereby boosting financial returns tied directly to company performance.
Eng. Yaqoub Marar, Director of the Energy Transition Directorate at the Ministry of Energy and Mineral Resources, explained that Jordan’s abundant renewable energy resources—wind and solar—are key drivers behind the decision, noting that other components such as electricity transmission networks, hydrogen and ammonia pipelines, and water infrastructure are integral to green hydrogen projects. He stressed that providing such incentives strengthens Jordan’s competitiveness with regional peers, positioning the Kingdom as a regional green hydrogen production hub.
He added that these measures align with Jordan’s Economic Modernization Vision, which prioritizes investment in clean energy and green hydrogen. The incentives, he noted, cover all components of hydrogen and ammonia production. Projects will proceed in phases, starting with memoranda of understanding for feasibility studies, followed by land-use agreements, and ultimately culminating in investment agreements with committed companies.
Energy expert Hashem Aqel affirmed that Jordan’s energy sector has proven highly attractive to both domestic and foreign investment, given its dynamic services and facilities that keep pace with global developments. He highlighted hydrogen energy as a key future sector globally, with reliance on it expected to grow significantly in the coming years. The latest exemptions and facilitations, he said, place Jordan in step with worldwide progress in this field.
For his part, Eng. Mohammed Al-Taani, Secretary-General of the Arab Renewable Energy Commission, described support for green hydrogen projects in Jordan as a vital strategic step, directly boosting solar-powered ammonia production, which forms the foundation of green hydrogen output.
Meanwhile, energy expert Amer Al-Taani noted that investing in green hydrogen represents a promising opportunity to directly strengthen the national economy through a high-value product that generates tangible returns and helps reduce living costs. He underlined that green hydrogen is already widely used worldwide, particularly in transportation, where it maintains the advantages of conventional fuels—such as long range and rapid refueling—while producing nearly zero carbon emissions. This makes it especially suitable for long distances and heavy loads.
Key applications, he explained, include private cars to cut emissions, city buses, heavy trucks (as seen in global pilot projects), and trains such as Germany’s Alstom Coradia iLint.
On July 2, 2025, the Cabinet instructed the Ministries of Energy and Mineral Resources, Investment, and Finance to review the incentives and exemptions granted to green hydrogen projects inside the Aqaba Special Economic Zone and extend them to all project components outside the Zone.
--(Petra)
