Dr. Adli Kandah

Throughout economic history, some projects have been designed to address immediate needs, while others have been conceived to reshape the development trajectory of nations for decades to come. Aqaba Railway, we hope, belongs to the latter category.

It should not be viewed merely as a rail line designed to move freight or replace trucks, but rather as a strategic economic asset capable of redefining Jordan’s position in the regional economy and transforming geography from a latent advantage into a productive economic resource.

In the 21st century, infrastructure has become a fundamental component of national economic power. Global competition is no longer determined solely by access to natural resources or industrial capacity; it increasingly depends on the ability to connect markets, reduce trade costs, secure supply chains, and develop integrated economic corridors.

For this reason, forward-looking economies invest in railways, ports, and logistics hubs not as simple capital expenditures, but as long-term investments in productivity, competitiveness, and economic resilience.

Jordan occupies a strategically important location at the intersection of the Arabian Gulf, the Levant, and the Red Sea. The Port of Aqaba represents the country’s only maritime gateway to global markets. Yet economic experience shows that geography alone does not create wealth. A location becomes an economic asset only when it is transformed into efficient networks that connect production centers with domestic and international markets.

This is where the strategic importance of the Aqaba Railway project emerges. It represents an investment in connecting production zones with export gateways and strengthening Jordan’s role in regional trade networks.

With an estimated investment value of around $2.3 billion, and developed within a Jordanian Emirati investment partnership, the project should not be assessed merely as a transport initiative. It should be viewed as part of a broader strategy to build a new logistics and industrial ecosystem.

The railway is expected to extend approximately 360 kilometers, linking the Port of Aqaba with mining and production areas. Its objectives include improving the efficiency of transporting phosphate, potash, and general freight, with a targeted freight capacity of around 16 million tons annually, according to announced plans.

Beyond Transport Revenues: Infrastructure as a Productivity Engine

One of the common mistakes in evaluating transport projects is to measure their success solely through direct operating revenues. Modern economic analysis, however, views transport infrastructure as a productive factor that influences the efficiency of the entire economy.

When the cost of moving raw materials and finished goods declines, companies become more competitive, production costs fall, and the country becomes more attractive to investors.

For Jordan, this impact is particularly significant because strategic sectors such as mining, chemicals, and fertilizers depend heavily on transport efficiency.

Moving large volumes of freight by rail also provides economic advantages compared with road transport, including lower costs, reduced energy consumption, greater reliability, and the ability to handle large-scale cargo flows.

From a Transit Economy to a Value-Added Economy
The true economic value of the project lies in its potential to move Jordan from an economy that primarily facilitates the movement of goods to one that captures a larger share of the value generated along supply chains.

Countries that have successfully transformed themselves into global logistics hubs failed simply because they owned ports. They succeeded because they developed integrated ecosystems around those ports, combining warehousing, re-export platforms, manufacturing, financial services, and digital infrastructure.

This is the lesson from global examples such as Rotterdam, Singapore, and Jebel Ali, where transport infrastructure became a foundation for the growth of entire economic sectors.

In Jordan’s case, Aqaba Railway could become the backbone of a new economic system connecting the port with industrial zones, free zones, and logistics centers. The movement of goods would then become a driver of growth rather than merely a transit activity.

However, the real challenge facing the Aqaba Railway project is not simply laying tracks; it is building the economic ecosystem that operates on top of them.

The success of the project should not be measured only by the kilometers of railway completed or the tons of cargo transported, but by its ability to create an integrated economic corridor linking the port with industry, mining, and regional trade.

Therefore, the strategic priority should extend beyond infrastructure development. It must be accompanied by a comprehensive plan to develop industrial and logistics zones along the railway route, establish dry ports, and attract manufacturing investments that benefit from lower transport costs.

The greatest economic value will not come from the railway itself, but from the economic activity created around it.

The strategic question to accompany the implementation of the project should be:
How can the railway become a platform for attracting new industries, expanding exports, and generating domestic value creation, rather than merely a mechanism for moving goods?

Expected Economic Impact
To assess the true economic value of the project, the central question should not be: “How much will the railway cost?” but rather: “What economic value can it generate over the coming decades?”

The following analytical estimates illustrate the potential impact if the project is completed and integrated into a broader industrial and logistics ecosystem:
Economic Indicator Expected Impact
Capital investment Around $2.3 billion
Railway connectivity Around 360 km
Target freight capacity Around 16 million tonnes annually
Reduction in heavy freight transport costs Approximately 20–30%
Potential improvement in export competitiveness 5–10%
Contribution to economic growth (reference scenario) Additional 0.5–1 percentage point annually
Private investment potentially stimulated $1–2 billion over the medium and long term
Direct and indirect employment opportunities 20,000–35,000 jobs
Logistics sector development Significant expansion in warehousing, transport, and supply-chain management
Reduction in freight-related emissions Approximately 20–30%
Regional development impact Creation of new growth centers outside Amman
Note: These estimates do not imply that the project will automatically deliver these outcomes. They depend on a critical condition: the railway must be embedded within an integrated economic strategy covering industrial development, investment promotion, trade facilitation, and the development of areas surrounding the railway corridor.
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Three Possible Economic Futures
The economic trajectory of the project could follow three different paths depending on the level of integration with the wider economy:
Scenario Underlying Assumption Potential Economic Impact
Conservative Focus primarily on transporting minerals and freight Additional GDP growth of 0.3–0.5 percentage points annually and creation of 8,000–12,000 jobs
Reference Integration with industrial zones and logistics platforms Additional GDP growth of 0.5–1 percentage point annually and 20,000–35,000 jobs
Transformational Integration into regional trade corridors and global supply chains Additional GDP growth of 1–1.5 percentage points annually and more than 50,000 jobs
Source: Author’s estimates
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Fiscal Impact: From Public Cost to Economic Return
At first glance, the project may appear to represent a significant burden on public finances due to the scale of investment required. However, the appropriate economic assessment must consider its broader multiplier effects.
If the railway succeeds in expanding exports, attracting investment, and increasing economic activity, the government’s revenue base could gradually widen. Over the long term, stronger economic growth could contribute to improving public debt dynamics by increasing the size of the economy relative to debt levels.
The key issue is selecting a financing model that does not rely solely on government borrowing, but instead combines investment partnerships, development finance, and private-sector participation.
Large-scale infrastructure projects achieve their greatest impact when they crowd in private investment rather than simply increasing public expenditure.

Economic Security: The Invisible Dimension
Recent global disruptions have demonstrated that economic security is increasingly linked to a country’s ability to maintain resilient supply chains.
From shipping disruptions to rising global transport costs, recent crises have shown that economies with diversified and efficient transport networks are better positioned to absorb external shocks.
From this perspective, Aqaba Railway is not only an economic development project; it is also an investment in Jordan’s economic resilience and logistics security.
A country’s competitiveness in the future will depend not only on what it produces, but also on how efficiently it connects its production capacity with regional and global markets.
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Conclusion: Moving Beyond Rails to Economic Transformation
The true value of Aqaba Railway will not be measured by the number of trains operating or kilometers of track completed. It will be measured by the number of industrial projects established around it, the volume of investment it attracts, and its ability to reduce the cost structure of the Jordanian economy and raise productivity.
Railways do not merely move goods; they move economies from one stage of development to another.

If managed within a comprehensive national economic vision, Aqaba Railway could become one of the most significant structural transformations in Jordan’s economy over the coming decades.

It could transform Aqaba from a national port into a regional economic platform and convert Jordan’s geographic position from a natural advantage into a genuine source of economic power.

The strategic opportunity is therefore much larger than building a railway line. It is about creating a new economic corridor — one that connects infrastructure with industry, logistics with investment, and geography with growth.

The question is not whether Jordan can build a railway. The question is whether it can build an economy around it.

Dr Adli Kandah -Economic and Financial Expert (Author’s estimates and analysis)