Raad Mahmoud Al-Tal

In the presence of His Majesty King Abdullah and His Highness Sheikh Khaled bin Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Chairman of the Abu Dhabi Executive Council, Jordan marked the groundbreaking of the Aqaba–Shidiya–Ma’an railway project, one of the country’s most significant transport infrastructure projects.

The scale of the project illustrates its economic significance. It represents an estimated investment of approximately $2.5 billion, with railway lines extending around 360 kilometers and an annual capacity of up to 16 million tons. The first phase is expected to transport approximately 13 million tons of phosphate annually from Shidiya to Aqaba, in addition to around 3 million tons of potash products from the Southern Jordan Valley.

The economic significance becomes clearer when considering the volume of goods involved. When millions of tons are transported every year, transportation becomes an important component of the final cost of exported products. Reducing transportation costs can therefore improve the competitiveness of Jordanian exports. Current estimates suggest that the railway could generate at least $40 million in annual savings in the transportation of phosphate and potash.

Its broader economic value could come from improving supply-chain efficiency, strengthening the competitiveness of phosphate and potash, supporting higher production, encouraging new investment in mining, manufacturing and logistics, and reducing pressure on the road network and its maintenance requirements.

This highlights a fundamental economic principle. An economy does not improve its productivity only by producing more goods. Productivity also increases when the same goods can be produced, transported and marketed at a lower cost. In this sense, investment in transport infrastructure is ultimately an investment in economic productivity.

Another important feature is the project’s annual capacity of 16 million tons. With the first phase expected to transport around 13 million tons, more than 80 percent of the designed capacity would be utilized from the outset. This provides a strong operational base while leaving additional capacity for future growth in production or the transportation of other goods.

The project also has important implications for the Port of Aqaba. The lower the time and cost required to move goods from production areas to the port, the more efficient the entire supply chain becomes. A modern railway network could therefore strengthen Aqaba’s role not only as a gateway for Jordanian exports, but also as a potential regional hub for logistics, transportation, storage and distribution.

The broader significance becomes even greater if Jordan succeeds in developing an integrated national railway network. The objective should not be limited to establishing a railway line serving phosphate and potash. Rather, it should form part of a wider transportation system connecting production centers, industrial areas, logistics facilities, ports and potentially regional markets.

Such connectivity could allow Jordan to transform its geographical position from a geographical advantage into a genuine economic and logistical advantage. It could also encourage investment in industries located near production areas or along the railway corridor, creating economic activity that extends beyond the railway itself.

The employment effects are also important. The project is expected to generate economic activity in the southern governorates, with around 5,000 job opportunities associated with the railway project and the Ma’an dry port. Yet its employment impact should not be measured only by the number of jobs created during construction and operation. Additional employment could emerge through the expansion of mining, manufacturing, logistics, transportation, storage, cargo handling and maintenance activities.

There is also a broader fiscal dimension. Higher production, stronger exports, increased investment and greater logistics activity can generate additional economic activity and, indirectly, additional government revenues through taxes and fees. At the same time, shifting part of heavy freight transportation from roads to rail could potentially reduce road maintenance costs and the pressures associated with heavy truck traffic.

Of course, these economic benefits are not automatic. Their realization will depend on efficient implementation and operation, actual utilization of the railway, future growth in phosphate and potash production, integration with Aqaba Port and other logistics facilities, and Jordan’s ability to use this infrastructure to expand its productive and export base.

The economic logic is straightforward: the lower the cost of transporting a product, the greater its competitiveness; and the greater its competitiveness, the greater the potential for expanding production, investment and exports.

From this perspective, the railway project is not simply an investment in transportation. It could become an important economic catalyst for investment, productivity, exports and competitiveness, while strengthening Jordan’s position as a regional logistics hub. Its real value should therefore be measured not simply by how many tons the railway carries, but by how much additional economic value it enables Jordan to create.