Wednesday, January 2, 2008

2008 Industrial Shutdown, Transportation & Construction Chaos

Sounds too Tragic... not really... Just a reasonable outcome...

Does anyone really comprehend the total effect of a sudden rise of fuel & electricity on all levels. We always look at the common man who will definitely be shocked and buried in bills. But we simply forget other factors that might change the face of Jordan forever.

Industry in Jordan was feeling the heat of competition in the last few years and many have shut down and decided to move on to a neighbouring country.

Competitive products from Saudi Arabia, Egypt, Syria and many others enjoy energy prices that are much less than Jordanian factories. They have increasing shares in Jordan and competition is simply out of the question.

So what happens if 70% of the manufacturers in Jordan, cannot cope after the planned rise in fuel and electricity. What about the people working in the factories, to the trucks that are hired to deliver the goods.

Major contractors have already started mumbling about new prices and the straw that will break the back of many. What will happen to contractors who have already signed construction contracts that are underway based on old prices?

Goods transportation from Aqaba to Amman, already witnessed around 30% increase at the beginning of Dec 07, what now? Traders will eventually add the cost on goods delivered to Jordanians.

Can anyone really estimate the full effect that we are about to witness, I don't think the government can. It would be wise to start with partial raises instead of a one time sudden raise that might cripple the Industrial & Construction sector.

Happy new year, indeed!


Mohanned said...

Actually my brother works in amman industrial chamber, and industrial leaders are already in contact with the government because just like you said almost 80% of them wouldn't be able to compete with the gulf, syria, egypt and even lebanon.

In other news, many factories already closed their doors and moved to egypt-especially the ones in the so called QIZs.

By the way, did abu husein come back from his vacation?


M Kilany said...

Long time ya man, Welcome back... I think we will be focusing on the service sector and commercial side of business...

I have no idea where Abu Husein is? I think you should stop seeing JTV & focus on your studies... :)