Jordan looks beyond FDI volumes to investment quality
last updated: 4 h ago
Increasing investment is no longer simply a matter of growing financial flows. The value each investment adds to the national economy, through job creation, export growth, technology transfer, and the deepening of local supply chains, has become the more important measure of its impact.اضافة اعلان
Balance of payments data show that foreign direct investment (FDI) inflows to Jordan rose 25.1 percent last year, reaching approximately $2.0248 billion compared to $1.6188 billion in 2024. That figure represents the highest level of FDI recorded since 2017.
Economic experts say the next phase demands a shift from "investment promotion" to "investment engineering": targeting specific types of investment and linking them to export sectors, supply chains, local skills, and existing projects to maximise their contribution to the national economy.
In statements to Al-Ghad, experts stressed that raising the quality of investment requires focusing on value-added sectors, particularly technology, the digital economy, pharmaceuticals, food industries, and renewable energy, as well as sectors capable of expanding exports and generating higher-value employment.
They also called for deeper public-private cooperation that extends beyond project implementation to include the formulation of economic policy and legislation, so that government decisions reflect the actual needs and challenges investors face. This, they said, would strengthen international confidence in the Jordanian market and attract long-term investment.
Bashar Al-Zoubi, a board member of the Jordanian Businessmen Association, said the government's stated objectives for improving the business environment reflect an understanding that investment attraction depends on an integrated system rather than financial incentives alone. That system, he said, encompasses ease of doing business, stable and transparent legislation, fast transaction processing, and efficient public services.
Al-Zoubi said simplifying procedures, reducing bureaucracy, and expanding digital government services would lower the cost and time needed to establish and operate projects. He called for continued development of digital services and for linking all relevant government entities through an integrated electronic platform.
He stressed the importance of supporting local investors as partners in drawing foreign capital, arguing that the growth and success of Jordanian companies are central to building international investor confidence in the market. He also called for a continuous review of economic and investment legislation to ensure stability and clarity, faster licensing and approvals, improved commercial dispute resolution, stronger competition frameworks, and better access to finance.
Prime Minister Jaafar Hassan affirmed that Jordan has clear objectives for improving the business and investment climate through regulatory reform, streamlined procedures, expanded digital services, strengthened public-private partnerships, and direct support for investors. Speaking during a recent visit to the Ministry of Investment, where he chaired a meeting of the Investment Council, Hassan said improving the investment environment is a shared responsibility across all ministries and institutions, not the Ministry of Investment's alone.
Hassan noted that the government would build on the opportunities created by royal visits abroad, including His Majesty the King's recent visit to the People's Republic of China, to encourage foreign partnerships and investment.
Mohammed Hadab Al-Sarhan, a professor of economics, said the next stage requires moving from investment promotion to what he terms "investment engineering." He described this as a shift from presenting opportunities and waiting for investors to actively identifying the type of investment the economy needs, the target company, the relevant export market, the skills required, and the local suppliers that can be linked to each project, then monitoring that project through to production and expansion.
Al-Sarhan said the 25.1 percent increase in FDI inflows provides a foundation for this transition. The challenge, he said, is no longer simply raising the volume of inflows, but maximising the impact of every dinar and dollar invested in Jordan through employment, exports, technology adoption, local procurement, and supply chain development.
One of the most important applications of investment engineering, Al-Sarhan said, is the concept of "investing around investment": using existing companies and factories as a base for generating new investment. Rather than treating large investors as self-contained entities, he said, policymakers should analyse their imports and global suppliers, then determine which inputs could be produced in Jordan, either by developing local companies or by attracting the global supplier itself to manufacture in the Kingdom in partnership with Jordanian capital.
He said the goal is not to produce every input domestically regardless of cost, but to develop a supply chain gap map starting with the largest export sectors, identifying what can be produced efficiently in Jordan, what requires attracting specialised investment, and what remains more economical to import. He cited the textile industry as an example, noting that while raw cotton production may be unsuitable for Jordan's conditions, higher-value stages such as spinning, weaving, finishing, or fabric manufacturing could be viable where cost and demand allow for competitiveness.
Al-Sarhan said investment engineering should also apply to Jordan's major strategic projects, with a "secondary investment map" developed for each one. The national water carrier, he said, is not solely a water project: it can expand the capacity of industrial, tourism, and urban zones. The national railway is not merely a transport project: it can generate investment in logistics, warehousing, maintenance, engineering, and downstream mining industries. The dry port and the Risha gas field, he added, can create new industrial and service opportunities in their surrounding areas if associated investments are planned in parallel with the core projects.
Al-Sarhan also argued that improving the business environment must focus on reducing the time between an investment decision and the start of production, since investors compare countries on speed of operations, not incentives alone. He proposed a national index measuring that interval and tracking where delays occur. "Every month shortened in the investor's journey effectively represents an investment incentive that does not cost the treasury any new exemptions," he said, describing procedural speed and institutional efficiency as fundamental to Jordan's competitiveness.
The increase in FDI inflows gives Jordan a positive base from which to advance to a more sophisticated investment policy. Going forward, success will be measured not by the number of projects or the volume of incoming capital, but by the ability to create quality jobs, grow exports, deepen local supply chains, transfer technology, and stimulate new investments around existing and strategic projects. It is in this context, experts say, that investment engineering offers an approach to move Jordan from simply receiving investment to actively designing its economic impact.
This article was originally written in Arabic by Abdul Rahman Al-Khawaldeh for Al Ghad. It was translated into English with AI assistance and edited by Jordan News.
Balance of payments data show that foreign direct investment (FDI) inflows to Jordan rose 25.1 percent last year, reaching approximately $2.0248 billion compared to $1.6188 billion in 2024. That figure represents the highest level of FDI recorded since 2017.
Economic experts say the next phase demands a shift from "investment promotion" to "investment engineering": targeting specific types of investment and linking them to export sectors, supply chains, local skills, and existing projects to maximise their contribution to the national economy.
In statements to Al-Ghad, experts stressed that raising the quality of investment requires focusing on value-added sectors, particularly technology, the digital economy, pharmaceuticals, food industries, and renewable energy, as well as sectors capable of expanding exports and generating higher-value employment.
They also called for deeper public-private cooperation that extends beyond project implementation to include the formulation of economic policy and legislation, so that government decisions reflect the actual needs and challenges investors face. This, they said, would strengthen international confidence in the Jordanian market and attract long-term investment.
Bashar Al-Zoubi, a board member of the Jordanian Businessmen Association, said the government's stated objectives for improving the business environment reflect an understanding that investment attraction depends on an integrated system rather than financial incentives alone. That system, he said, encompasses ease of doing business, stable and transparent legislation, fast transaction processing, and efficient public services.
Al-Zoubi said simplifying procedures, reducing bureaucracy, and expanding digital government services would lower the cost and time needed to establish and operate projects. He called for continued development of digital services and for linking all relevant government entities through an integrated electronic platform.
He stressed the importance of supporting local investors as partners in drawing foreign capital, arguing that the growth and success of Jordanian companies are central to building international investor confidence in the market. He also called for a continuous review of economic and investment legislation to ensure stability and clarity, faster licensing and approvals, improved commercial dispute resolution, stronger competition frameworks, and better access to finance.
Prime Minister Jaafar Hassan affirmed that Jordan has clear objectives for improving the business and investment climate through regulatory reform, streamlined procedures, expanded digital services, strengthened public-private partnerships, and direct support for investors. Speaking during a recent visit to the Ministry of Investment, where he chaired a meeting of the Investment Council, Hassan said improving the investment environment is a shared responsibility across all ministries and institutions, not the Ministry of Investment's alone.
Hassan noted that the government would build on the opportunities created by royal visits abroad, including His Majesty the King's recent visit to the People's Republic of China, to encourage foreign partnerships and investment.
Mohammed Hadab Al-Sarhan, a professor of economics, said the next stage requires moving from investment promotion to what he terms "investment engineering." He described this as a shift from presenting opportunities and waiting for investors to actively identifying the type of investment the economy needs, the target company, the relevant export market, the skills required, and the local suppliers that can be linked to each project, then monitoring that project through to production and expansion.
Al-Sarhan said the 25.1 percent increase in FDI inflows provides a foundation for this transition. The challenge, he said, is no longer simply raising the volume of inflows, but maximising the impact of every dinar and dollar invested in Jordan through employment, exports, technology adoption, local procurement, and supply chain development.
One of the most important applications of investment engineering, Al-Sarhan said, is the concept of "investing around investment": using existing companies and factories as a base for generating new investment. Rather than treating large investors as self-contained entities, he said, policymakers should analyse their imports and global suppliers, then determine which inputs could be produced in Jordan, either by developing local companies or by attracting the global supplier itself to manufacture in the Kingdom in partnership with Jordanian capital.
He said the goal is not to produce every input domestically regardless of cost, but to develop a supply chain gap map starting with the largest export sectors, identifying what can be produced efficiently in Jordan, what requires attracting specialised investment, and what remains more economical to import. He cited the textile industry as an example, noting that while raw cotton production may be unsuitable for Jordan's conditions, higher-value stages such as spinning, weaving, finishing, or fabric manufacturing could be viable where cost and demand allow for competitiveness.
Al-Sarhan said investment engineering should also apply to Jordan's major strategic projects, with a "secondary investment map" developed for each one. The national water carrier, he said, is not solely a water project: it can expand the capacity of industrial, tourism, and urban zones. The national railway is not merely a transport project: it can generate investment in logistics, warehousing, maintenance, engineering, and downstream mining industries. The dry port and the Risha gas field, he added, can create new industrial and service opportunities in their surrounding areas if associated investments are planned in parallel with the core projects.
Al-Sarhan also argued that improving the business environment must focus on reducing the time between an investment decision and the start of production, since investors compare countries on speed of operations, not incentives alone. He proposed a national index measuring that interval and tracking where delays occur. "Every month shortened in the investor's journey effectively represents an investment incentive that does not cost the treasury any new exemptions," he said, describing procedural speed and institutional efficiency as fundamental to Jordan's competitiveness.
The increase in FDI inflows gives Jordan a positive base from which to advance to a more sophisticated investment policy. Going forward, success will be measured not by the number of projects or the volume of incoming capital, but by the ability to create quality jobs, grow exports, deepen local supply chains, transfer technology, and stimulate new investments around existing and strategic projects. It is in this context, experts say, that investment engineering offers an approach to move Jordan from simply receiving investment to actively designing its economic impact.
This article was originally written in Arabic by Abdul Rahman Al-Khawaldeh for Al Ghad. It was translated into English with AI assistance and edited by Jordan News.