Save the industrial sector

Salameh daraawi
Salameh Darawi (Photo: Jordan News)
All sectors, including the industrial sector, currently need saving and stimulation. They need a helping hand from the government to maintain their activities in the medium term and expand investment in the medium and long terms. اضافة اعلان

Government support is not necessarily financial as some might think. In fact, the private sector, and industries in particular, are the ones that support the government and feed the Treasury through taxes and various fees to help the public sector secure money for its increasing expenses. What is required, is supporting the business environment through a series of decisions that enhance the industrial sector. Such decisions would also aid an administrative revolution by revisiting the package of official measures concerning the private and industrial sectors.

 Industrialists are in dire need of a genuine partnership with the government in regards to economic decision making. They need to actually feel like they are part of the process rather than on the receiving end of government decisions related to their businesses, most of which come out of nowhere and cause a shock to the sector.

Why should the sector have priority in a partnership with the government? It is because it is the largest employer of local labor, home to technology and development, a major exporter of Jordanian-made products, and contributes to a quarter of GDP. It is also because our factories are most able to employ and combat unemployment, and because the progress of nations is measured by their industrial progress, among dozens of other reasons that should put this sector on the top spot of the government’s to-do list.

 A good part of the challenges facing industries has nothing to do with the Arab-Israeli conflict or a regional conspiracy, but are rather the consequence of a government that did not consider the repercussions of its decisions on the national economy and industrial sector.

Many of the government’s official decisions come as an act of mere spontaneous reaction, and have nothing to do with sound planning and partnership with the private sector. One recent example is when the media started talking about an international spike in the prices of essential commodities and the reflection of that on the local market. The government immediately placed price caps on some items like cooking oil, thus giving imported vegetable oil a competitive edge, in terms of cost, over domestically produced items. That was a painful blow to local producers, who were helpless in the face of competition from low-cost imported goods.

Before the holiday, the Ministry of Industry, Trade, and Supply made a very weird decision to allow the import of candy and children’s clothes from Syria; which, by the way, bans the import of Jordanian products under numerous pretexts. This came while there are hundreds of local factories that produce these items at the highest quality.

So why would the ministry allow the entry of these goods from a country that denies our entry into its own market, causing so much harm to local producers? No one knows in favor of whom such a move was? If traders are the ones who benefited from that, why not import from the dozens from other markets that offer the same products? If consumers are the beneficiaries, external markets are also open. It goes without saying that the national economy’s benefit is out of question.

In fact, the ministry’s decision has an adverse effect on the economy because it harms local factories that make the same products we import and reflects negatively on its ability to produce and compete compared to competitors in Syria, where labor is so cheap that a worker’s wage is equal to $40 (a month). In Syria, power, water, and all other production inputs and regulations guarding health and quality are also loose.

All of these factors lead to unfair competition between local products and those imported from neighbors.

These are true examples of government decisions that have had grave consequences on the industrial sector and required concerned authorities to reconsider trade agreements the Kingdom has with countries. These deals have clearly turned into a real nightmare for the national economy due to the absence of justice regarding competition and obstacles preventing the flow of Jordanian-made products into these markets.

The rule is that the government must adhere to a principle of reciprocal treatment, instead of free economic compromises to countries where we suffer a huge deficit in the trade balance and unjust trade competition.

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