Youth emigration and the investment law


[01-08-2022 11:25 AM]

BY Fares Braizat

The number of Jordanians who expressed desire to emigrate, found by the latest Arab Barometer poll, stands at 48 percent of the adult population. Among the 18-29 year olds, 63 percent stated that they would leave the country. That is disturbing.

Of people with higher education, 56 percent expressed the desire to leave. For those who would like emigrate, the US is the preferred choice, at 35 percent, followed by Saudi Arabia, 26 percent, and UAE, 13 percent.

Surveys have been showing a steady, yet fluctuating, increase in the percentage of Jordanians who have considered leaving the country since 2006, when the desire to emigrate stood at around 15 percent.

What are the implications of these facts for public policy formulation and execution?

Economic implications. The main driver of this propensity to emigrate among Jordanians is the ill-performing economy. When 93 percent of Jordanians who express their desire to emigrate attribute it to economic reasons, decision makers have to pause, think, and come up with innovative solutions.

Today, there is a great opportunity to address this issue through the investment law that is being discussed in Parliament. To be specific, Article 3, paragraphs D and E, of the proposed law mentions good policy principles, such as incentivizing and encouraging entrepreneurial and innovative projects, and providing a suitable business environment for small and medium enterprises.

However, these good principles are distorted in Article 10, which should reflect the motivations, the incentives that help retain investors, especially young ones, in the country to create jobs for others, and help the economy grow. This article of the draft states: “… or reducing income tax on economic activities in less developed areas by not less than 30 percent”; this must be reformulated. Income tax in these areas must be zero for at least five years, instead of three.

The current formulation of this article is vague and will get investors entangled in the notorious bureaucratic pathways that will cause them to flee.

It is also paramount to differentiate small and medium enterprises from companies that employ 300 Jordanians at least. These are two different scales. Having them both in the same paragraph, with the same conditions stipulated, blurs clarity and leaves a vast space for the “bureaucratic imagination” that has stifled investments for decades. We should avoid this by all means.

One more proposal to consider here are the special incentives for young Jordanian entrepreneurs, which should go above and beyond what is being offered in the current proposed law. These may include 10 years of tax exemption for the 18–40 year olds, Jordanians who are self-employed and hire a few others, and conduct their business in labor-intensive sectors such as agriculture and tourism, which are national priorities. Extra incentives should be given to the youth in rural, underdeveloped areas.

Despite the many expressions of disagreement with the American policies in the region, the US is the preferred destination for people who hope to emigrate. Internally, the youth (18–29 year olds) are deserting the political process, as the 2016 and 2020 parliamentary elections results clearly show; we must give them economic incentives to retain them politically. Their levels of frustration cannot be clearer than when they say “I want to leave this country.” This should not go unnoticed; it is disturbing and telling.




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