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July 31, 2001

H.R. 2603 - US-Jordan Free Trade Area Implementation Act
(Rep. Thomas (R) California)

The Administration strongly supports House passage of H.R. 2603, which would implement the U.S.-Jordan Free Trade Area (FTA) Agreement. This Agreement, the first ever between the United States and an Arab state, represents a positive step during a sensitive and volatile time in the Middle East. Jordan is a key friend in working with the United States to promote peace and prosperity in the region. The country is at a critical juncture in its efforts to address a daunting array of economic challenges, including the economic disruptions caused by the recent round of violence in the Middle East. Implementation of the FTA will provide enhanced access to the U.S. market that will allow Jordan to generate trade and investment that can play a vital role in generating the economic growth and jobs that Jordan so badly needs. The FTA will send a signal to Jordan, as well as other countries in the region, that support for peace and economic reform yields concrete benefits.

The U.S.-Jordan FTA also has broad economic implications for the region. The FTA is the capstone of growing U.S.-Jordanian collaboration in economic relations, which began with close bilateral cooperation on Jordan's accession to the World Trade Organization (WTO) and was followed by the conclusion of a trade and investment framework agreement and a bilateral investment treaty. Implementing this Agreement will provide a model of economic reform and development that hopefully will be emulated throughout the Middle East. The business community and general public in Jordan, Egypt, and other Middle East countries are looking for proof that the risks entailed in committing to open and competitive markets produce benefits. Implementation of the Jordan FTA will help determine whether support for economic reform and liberalization continues in the region.

While the Jordan FTA has broad strategic and regional importance, it also will provide benefits for U.S. firms. The Jordan FTA achieves significant and extensive liberalization across a wide spectrum of trade issues, including electronic commerce, services, intellectual property rights, and elimination of tariffs in virtually all industrial goods and agricultural products within 10 years. The Agreement provides better market access for U.S. suppliers vis-a-vis European Union suppliers, our key competitors in Jordan and throughout the Middle East.

Given the important benefits of the Jordan FTA in terms of U.S. strategic interests in Middle East peace and stability and support for the development of free market economies in Jordan and other developing countries, the Administration urges Congress to pass H.R. 2603.