To ensure competitiveness

[29-11-2017 04:58 AM]

AMMONNEWS - By Marwan Al-Shammari - Despite the economic struggle of the country in recent years, Jordan still enjoys several advantages over other countries in the Middle East, foremost among which are security, political stability, moderate culture, human capital and geographical location.

More needs to be done in regard to competitiveness, however, as this is an important indicator often used by financial, economic and business analysts to make recommendations regarding investment in that country, and to make comparisons and recommendations to multinational corporations that seek new markets and opportunities to invest.

King Abdullah has reached out to business leaders and owners in the US and elsewhere, and works tirelessly to put Jordan in the spotlight as an attractive destination for investors.

He instructed the government to work harder on the problems that used to constitute major hurdles for potential local and foreign investors. However, governments are still too slow to catch up with the King’s efforts and calls for reasons that are unclear.

The comparative advantage theory suggests that a country must specialise only in the products, services, industries, fields and activities in which it is more efficient than other countries.

That should apply to Jordan as well. We need to focus on what we do best and let go of inefficient, ineffective and useless activities; we need to stop wasting money on things that other countries do better.
In the same vein, the private sector should be encouraged to play a role in fields the government has been unable to improve and compete internationally.

In the medical field, for example, Jordan had an incomparable reputation in the region for decades. Recently, however, there has been very slow progress that negatively affected the country’s position on the map, so the question is why did the government not focus on remaining superior in this field, to maintain competitiveness, instead of wasting efforts and money on several useless industries that it could have left to the private sector or foreign investors.

Or why not make fair allocation of its limited resources based on the importance and contribution of each sector in which it has a stake?

Why not focus on industries, products and services in which the cost of input is lower than in other countries, and improve their efficiency by using the available know how in order to lead to improved productivity in domains where we have a comparative advantage, and decrease the deficit in the balance of trade with countries from which we import some products?

Many foreign items that are sold in the Jordanian market have inputs that are available in Jordan. Why, then, not manufacture them locally?

Why not encourage producing companies to come in and take advantage of the low cost of the inputs to start manufacturing those items in Jordan, with the added advantage of location, which helps them cut costs?
Jordan also has a talented human capital, skilled labour and an active research community that, if well utilised, could help the country reach success.

The use of technology is vital to the survival, competitiveness and profit making of companies and countries; it helps increase efficiency, quality and revenues.

Yet, in Jordan, the government has been slow in incorporating technology in its major functional areas; the e-government project, still stumbling and suffering in many respects, is a case in point.

There are no excuses for it. The country has the resources needed, the skilled workers and experts, knowledge and information, and people’s and private sector’s will to implement it. So why the slow pace, especially when knowing that it is important to attracting foreign investment?

Also important are partnerships between the public and private sectors, and between local communities and these two sectors.

Equally essential to attracting foreign investment are government regulations, which should be streamlined to make the country an important investment destination.

Competition is fierce and without a true and positive collaboration among all concerned parties, it is impossible to succeed.

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