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The Development and Free Zones Regime of Jordan
Fourth Forum for Investment In Free Zones and Development Areas
Muscat, Sultanate of Oman
3rd-4th December 2011
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1.The National Economic Setup
2. Investment Enabling Platforms
3. The Regulatory Role
4. The Financial Incentive Package
5. Site Development & Management
6. Existing Portfolio
Presentation Highlightswww.dfzc.jo
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Critical National Investment Drivers
• National policy on key economic sectors
• Track record of economic and political stability
• Transparent and dynamic business environment
• Geographic location; a transportation and logistics hub
• Access to major international and regional markets
• Educated and experienced workforce
• High quality infrastructure
• Support and commitment at all governmental levels
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Access to National, International and Regional Markets
• Member of the WTO
• Jordan-US Free Trade Agreement
• Great Arab Free Trade Agreement
• Euro-Jordanian Association Agreement
• Aghadeer Agreement
• Bilateral Free Trade Agreements with Singapore, Canada and Turkey
“Customs Free and Quota Free” Access to 1 Billion Consumer
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Enabling National Policy for Cluster Development
• Objectives: - Promote FDI and DDI
- Expand Export Potential under Preferential Market Access - Distribute Economic Gains across Sub-national Regions - Create Jobs and local economic benefits
• Key Economic Clusters:- Dry Port and Logistics- Electricity Generation from Renewable Solar Energy Sources- ICT, Clean Technology and BPO- Eco-tourism and Wellness; Dead Sea and Ajloun- High Value Added Industries
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The Development and Free Zones as an Investment Enabling Platform
Government• Policy
enablement• Land• External infra-
structure• Financial
Incentives
Commission
• Planning approvals
• Business licensing
• Provide Gov”t interface
Master Developer
• Onsite infrastructure
• Municipal services
• Marketing
Investor
• Construct project• Regime in
exchange for commitment
The Law Provides Total Business Solutions
Provide training Generate Jobs
Transparent, Proactive, Unified and Streamlined
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DFZC Roles and ResponsibilitiesGood Governance and Friendly Interface
1.Economic Planning:
2.Regulating
3.Site Management
4.Local Economic Development
• Harmonizing National Investment Location Map• Recommending establishments of new sites
• Land zoning, planning and construction permitting• Business registration and licensing• Environmental management• Expatriate workforce permitting
• Establishing and regulating Municipal or Common Facility Management Regime
• Managing Master Development Contracts
• HR Training & Development• SME’s Support• Supporting Corporate Social Responsibility
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Tax Exemptions for Development AreasAutomatic and Project Life-Long in exchange of Preferential Market Access
Corporate Income TaxOn income accrued by all business operations conducted within the zone
5%
Custom DutiesOn all capital assets and goods imported for conducting business operations 0%
Sales TaxOn all goods and services procured for conducting business operations
Social Services TaxOn accrued business income
Capital Gains Tax
No restrictions on Foreign Direct Investment
0%
0%
0%
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Corporate Income & Social Services TaxOn income accrued by all business operations conducted within the zone 0%
Custom DutiesOn capital assets and production input materials
0%
Personal Income TaxOn salaries and remittances of non-Jordanian employees0%
Tax Exemptions for Free ZonesPreferential Market Access is Restricted
Buildings & Land Tax and Licensing FeesOn assets within the zone 0%
Full Repatriation of FDI Capital upon Liquidation
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Master Developer’s Roles & ResponsibilitiesAdvanced Municipal Entity
Business Planning, Site Development & Management, Promotion and Marketing
• Preparing and implementing: - Market Assessment and Business Plans - Master Plan and Infrastructure Engineering Plan - Financing Plan - Marketing and Promotion Plan - Strategic Environmental Assessment Study
• Managing sub-development agreements with located business• Site and Facility Management & Provision of Municipal Services• Assuming regulatory powers delegated by DFZC
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Master Development CompaniesPublic Funds with Long Term Investments Horizon & Opportunities for PPP’s
1.Master DevelopersThe Investment
Unit/Social Security Corporation
• Business Park• Irbid• Mafraq• 10% Jordan Armed Forces,
5%King Abdullah II Fund For Development, 5% The Hashemite Fund For Development of Jordan Badia
Jordan For Development Zones
(100% Public)• Dead Sea• Ajloun
King Abdullah II Fund For Development
• Ma’an(Jordan Industrial Estates Corporation, Al-Hussein Bin Talal University)
2.Master Developers to be Grandfathered within the DFZC Regime
• Industrial Zones Company• Free Zones Company• 9 private companies in Private Industrial Zones• 35 private companies in Private Free Zones
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Harmonize all Investment Enabling Platforms and Consolidate within a National Vision
Level-Playing Field with Additional Room for Performance Based Incentives
Leading Sectors
IndustryTourismTrade & Logistics
IT Services
More than 8000 businesses
61 Sites6 Development
Areas15 Industrial
Zones 40 Free Zones
More than 85,000 Jobs
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Development AreasA Platform to Enable and Spread Investments across Different Regions of Jordan
فرص العملقيمة االستثمارات: مليون دينارالمناطق التنموية
المساحة )دونم(تاريخ اإلعالنعدد المؤسسات
المسجلة
تم استثماره قبل إعالن المنطقة
التنمويةاستثمارات جديدة
العمالة قبل إعالن المنطقة التنموية
فرص العمل الجديدة
ملتزم بهمتحققملتزم بهمتحقق
Nov ,200621,000 16 - 43 143 300 2,900المفرق1
Sep ,20079,000 18 - 60 685 85 1,100معان2
Nov ,20073,200 9 - 900إربد3
May ,200940,000 27 391 17 372 2,100 3,040البحر الميت4
- - July ,20092,300جبل عجلون5
Jan ,20101,400 14 - 1,100مجمع األعمال6
7,940 1,485 1,200 120 84 76,900المجموع
ΎϬϧϣΓΩΩΟΗϣϟΔϗΎρϟΔϓέόΗέΎυΗϧΎΑϥϭϳϠϣ
مطلع في أعمالها الهيئة 2009مباشرة
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Industrial Estates and Free ZonesUnifying the Regulatory Framework and Removing Existing Distortions
فرص العملقيمة االستثمارات: مليون دينارالمدن الصناعية والمناطق الحرة
عدد المناطقتاريخ التأسيسعدد المؤسسات
المسجلة
تم استثماره قبل إعالن المنطقة
التنمويةاستثمارات جديدة
العمالة قبل إعالن المنطقة التنموية
فرص العمل الجديدة
ملتزم بهمتحققملتزم بهمتحققJIEC :1980المدن الصناعية
Under DFZC: 2011
29,000 1,400 500 6العامة
34,000 450 175 9الخاصة
JFZC :1973المناطق الحرةUnder DFZC :2011
12,000 2,700 7,600 5العامة
8,000 1,000 100 35الخاصة
- 83,000 5,550 8,375 55المجموع