Investment Adventures in Emerging Markets

Jordan: Optimism in the Heart of the Middle East

The Dead Sea

We arrived in Amman, Jordan to search for investments. We originally invested in Jordan about 10 years ago, and now with our frontier markets strategies, Jordan is an appropriate place for a revisit. Amman certainly was a changed city since our last visit with many more skyscrapers and visibly newer developments.

Jordan is a modern democratic constitutional monarchy with the King as head of state. It has a highly educated population of about 6.1 million with a growing middle class.[1] The government’s focus has been on economic reform and growth. The role played by a good education system has been significant in the development of Jordan from a predominantly agrarian to an industrialized nation. Jordan’s education system ranks number one in the Arab world, and the country is among the region’s highest spenders on education, investing more than 20% of its GDP in education.[2]

The importance of the health care industry and the high status of professional women in Jordanian society were underlined when we visited a major pharmaceutical company. A very capable female Executive Vice President gave us a comprehensive picture of the company. It has manufacturing plants in the Middle East and North Africa (MENA) region, Europe and the U.S., and plans to strengthen its leading position in the growing healthcare market in MENA and maintain its world-class manufacturing capabilities. Our host mentioned that regional political turbulence was not a deterrent to their growth plans. Instead, they were planning to register new products in the region. With a higher standard of living and healthier diets, the regional trend is a decline in acute infectious diseases but an increase in chronic diseases such as cancer, cardiovascular diseases and diabetes, which are often associated with developed countries.[3] Because many MENA countries have imposed laws and regulations to strengthen local manufacturers, the firm’s local manufacturing facilities have a competitive advantage over foreign manufacturers.

Banking is another sector that interested us. We visited a bank that has been operating in Jordan since the early 20th century and has employees in 30 countries. We were graciously met by a descendant of the bank’s founder and other officers who talked about their risk management system. They say that their regional reputation is such that in times of trouble, clients have gravitated to them for their track record of safety. As a testament to its conservative nature, the bank has a credit rating higher than the rating given to the government of Jordan.

In front of the potash company plant

In line with rising global food needs, fertilizer demand worldwide is expanding. We met an executive in the phosphate industry who had a very optimistic view of the fertilizer business because of Chinese and Indian demand for food. Jordan has large sources of potash (phosphorus) and potassium elements used in fertilizers. To further investigate the Jordanian potash industry, we drove to the Dead Sea site of a potash plant. There, the salty brine from the Dead Sea was being evaporated in vast salt ponds stretching 150 square kilometers. The concentrated brine is treated to produce not only potash, but finished products such as bath salts and chemicals like bromine (the fire retardant) and potassium nitrate. Several companies produce bath salts and Dead Sea mud for cosmetic use. Back in Amman, I purchased a package of the Dead Sea mud and found it had a stimulating and healing effect and left my skin smooth.

On our way back to Amman, we stopped for lunch at a beautiful hotel terrace overlooking the Dead Sea, designed to look like the hanging gardens of Babylon. We did not have enough time to try the hotel’s sea water spa treatments but that is on our “to do” list. We look forward to our return to Jordan.

[1] Source: EIU, as of Dec 2008.

[2] Source: Jordan Investment Board, as of 2008.

[3] Source: World Health Organization –

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