The intrepid investor guide to Jordan 30 9 2021

Last week, the Council of Ministers issued an amendment to the requirements/instructions for granting Jordanian citizenship and residency to investors "for the purpose of creating an environment that attracts foreign investment". Never mind that the act of providing residency or citizenship does not create an environment that is conducive to investment, but also, the requirements themselves may put off some investors from investing in Jordan. The below is some of the highlights that warrant further contemplation from the regulators.

According to the new instructions, granting Jordanian citizenship to the investor requires the investor to deposit one million US dollars for three years at the Central Bank of Jordan with zero interest. No withdrawal is allowed. Or, the investor must purchase one million dollars worth of treasury bonds for six years at an interest rate to be determined by the Central Bank of Jordan. Furthermore, the investor must have been for at least one whole month in the Kingdom before the citizenship application date.   

Upon reading this paragraph in the instructions, a quick slew of questions come to mind, and they are most oratorical.  Here we go: 1) Where did the US$1 million limit come from? 2) Did the regulator conduct a comparison with what is offered elsewhere? 3) Why should the amount be deposited at the Central bank without interest? 4) Why does the central bank determine the interest rate on the bonds instead of using the going rate on treasury bonds? Is it to make the most of interest from the investor? Let’s be careful here as this sounds as if the government is selling the nationality for the interest on the deposit or the bonds.  5) Does the author of this not know that Jordan thus appears to sell citizenship for the interest earned? 6) Doesn't such a condition send the wrong message to the world? 7) And if the interest amount is the primary target and goal, then the regulator should determine such a value and demand it outright for the investor and save all from the acrimonious process of depositing a million and then withdrawing it. Just take the money (the calculated cumulative interest amount over the three years), and give the person his/her citizenship. 8) And why should the investor be present in Jordan a whole month before submitting the citizenship application? Are we going to ask him to prove that? What is the purpose of this request in the first place? Maybe the regulator should try to appear less of an authoritarian bureaucrat since we/he/she, and all of us, are in the business of investment promotion. 9) Why make the deposit/bonds in US dollars and not in Jordanian dinars to encourage the demand for local currency from investors residing in Jordan, especially since Jordan’s foreign currency reserves are at their highest level ever?

One other condition for granting citizenship is the purchase of shares in Jordanian companies for an amount of no less than one and a half million US dollars (note, again in US$), provided that the shares are not disposed of for no less than three years! 10) What will happen to the investor if the company goes bankrupt? 11) Is it possible that this condition is biased against emerging and small companies, and promotes investment in large companies that do not need funding or support in the first place? 12) Isn't it the policy in Jordan to support small and medium businesses? 13) Does this condition support our stated directions? Of course not!

Ah, but wait! There is a condition whereby if one buys a real estate for JOD200,000, then the person can be granted a five-year residency? Is it renewable? The answer is not mentioned in the copy of the instructions that were circulated.  

Then comes another gem; the principle of granting a temporary passport for three years when establishing a productive project with a paid-in capital of at least 1 million US dollars within the borders of the capital, and US$750,000 if the project is located outside the capital governorate, provided that 10 “real” job opportunities are provided to Jordanians. What is a “real” job? Who determines if it is real or fictitious? Will there be search or inspection parties sent to the investors’ locations to determine the reality of the jobs? How many times will they visit to determine realism? They would definitely have significant power over the investors because their determinations could lead to losing the temporary passports.

Also, what would happen if the number of real jobs falls below 10? And, why discriminate against other governorates by asking for less investment there to be granted the residency? Is it because the quality of life there is below that of living in the capital, so we ask the investor to invest less as if investing is a tax or something painful and unrewarding? Investment, albeit requires spending is not a tax, so it should not be subject to similar conditions. Besides, tax holidays as incentives have failed to create an attractive environment for investment in the governorates.

It is also possible to obtain residency in the Kingdom for five years “regardless of the investor’s previous stay in the Kingdom”, when buying a property, with a value of no less than JOD 200,000, which value is determined " According to the assessment of the Department of Lands and Surveys” (meaning that any other assessment is not recognized), with the property being kept for no less than 5 years without any right to dispose of it or mortgage it. Still, the right to obtain residency is not automatic even in this case. Rather, the residency is issued by a decision of the Minister of Interior and based on the recommendation of the Special Investors Committee. Furthermore, when any of the previous conditions is violated, the citizenship is withdrawn and the residency is canceled for the investor.

Have you had enough? Wait, there is more. There are also limitations and restrictions on the age and sex of the children of an investor who are entitled to Jordanian citizenship. Why can't a father grant his children citizenship once he/she becomes a citizen? If the investment exceeds three million US dollars, the investor can grant citizenship to his male children (not the females) that are over thirty years of age. Is this discrimination based on gender? I think so!

There are also limits on the number of investors that can benefit from these instructions per year. They should not exceed 500 per year. Shall we tell the rest, in case more than 500 desire to benefit from these wonderful instructions that our quota is full for the year and that they should wait until next year? What is if the 501 investor turns out to be a billionaire who wants to invest hundreds of millions of dollars in Jordan. Would you tell him to wait?  

There are so many more heart-wrenching measures in the instructions that may give the wrong idea about Jordan. In fact, the instructions will harm the investment climate instead of improving it. Please withdraw them before it is too late.

https://www.jordantimes.com/opinion/yusuf-mansur/intrepid-investor-guide-jordan

تساؤلات في شروط منح الجنسية للمستثمرين 15 9 2021

أصدر مجلس الوزراء الأسبوع الماضي تعديلاً لأسس منح الجنسية الأردنية للمستثمرين والإقامة عن طريق الاستثمار "لغايات تهيئة البيئة الجاذبة للاستثمار الخارجي". وبقراءة سريعة لهذه التعليمات الجديدة نجد انها تخالف هذه الغايات بل إنها قد تضر بالاستثمارات ومحاولة جذبه.  

حيث يتطلب منح الجنسية الأردنية للمستثمر إيداع وديعة بقيمة مليون دولار لدى البنك المركزي الأردني دون فائدة، ولمدّة 3 سنوات، وعدم السّحب منها خلال هذه المدّة وشراء سندات خزينة بقيمة مليون دولار لمدّة 6 سنوات، بفائدة يحدّدها البنك المركزي الأردني، وذلك شريطة تواجد المستثمر داخل أراضي المملكة لمدّة لا تقلّ عن شهر قبل توقيع التوصية النهائيّة بمنحه الجنسيّة الأردنيّة.

هنا يأتي سؤال مهم: من أين أتى صانع هذه التعليمات بمبلغ مليوني دولار؟ هل عمل دراسة مقارنة مع دول أخرى تقدم الجنسية مقابل الاستثمار، وقارن بين ما تقدمه الأردن وتقدمه دول شبيهة؟  ولماذا يجب ان يودع المبلغ بدون فائدة ,لماذا يحدد البنك المركزي الفائدة بالنسبة للسندات؟ هل فارق الفائدة المفقود للمودع هو ثمن الجنسية؟ ألا يعلم واضع هذا اننا نبدو بذلك وكأننا نبيع الجنسية بالفائدة المتحققة؟ ألا يرسل مثل هذا الشرط الرسالة الخطأ للعالم؟ وإذا كانت الفوائد هي الغاية فحددوا قيمتها واطلبوها من المستثمر مباشرة وليدفعها ويتصرف هو بأمواله؛ يعني بالعامية بيعوه الجواز بسعر الفائدة من أولها.  

ولماذا يجب ان يتواجد المستثمر قبل شهر من تقديم طلب الجنسية في الأردن؟ وهل سنطلب منه أن يثبت ذلك؟ ولماذا هذا الطلب أصلا—حذار فإننا نبدو كمجموعة بيروقراطيين سلطويين لا نرحب بأحد، وقد يكون في هذا شيء من حقيقة مرّة.

وما هي الحكمة أو العلم أو المعرفة أو الفهلوة المتبعة في تحديد هذه الشروط؟ هل أسعارنا للجنسية من خلال الاستثمار (الفائدة المتحققة للحكومة) تعتبر منافسة عالمياً وبالمقارنة بمن؟ ولماذا تكون بالدولار وليس بالدينار الأردني لنشجع الطلب من المستثمرين المقيمين هنا على عملتنا المحلية وخاصةً وان احتياط الأردن من العملة الصعبة بأعلى مستوياته ولسنا بحاجة لمزيد من الدولارات، كما وأن الدول التي تطلب هكذا شروط هي دول تحتاج الى دعم عملاتها أو تواجه عملاتها تقلبات كثيرة وهو ما يخالف الحال بالنسبة للأردن.

هناك شرط شراء أسهم أو حصص في شركات أردنيّة بمبلغ لا يقلّ عن مليون ونصف المليون دولار، على أن لا يتمّ التصرف بالحصص لمدّة لا تقلّ عن 3 سنوات، شريطة قيام دائرة مراقبة الشركات أو هيئة الأوراق الماليّة بوضع إشارة الحجز عليها!! ما الذي سيحصل للمستثمر في حال افلست الشركة؟ وهل من الممكن ان يكون هذا الشرط متحيزا ضد الشركات الناشئة والصغيرة، ويعزز للاستثمار في الشركات الكبيرة التي ليست بحاجة الى تمويل أو دعم أساسا؟ أليست سياستنا أن ندعم الشركات الصغيرة والمتوسطة؟ هل يدعم هذا الشرط توجهاتنا المعلنة؟ بالطبع لا.

 ثم يأتينا مبدأ منح جواز سفر مؤقت لمدة 3 سنوات عند إنشاء مشروع انتاجي برأسمال مال مدفوع لا يقل عن مليون دولار داخل حدود العاصمة، و750 الف دولار خارج حدود العاصمة، شريطة توفير 10 فرص عمل "حقيقيّة" للأردنيين..

هنا تحضرني استفسارات مهمة وهي، يجب ان يلتزم المستثمر ولمدة 3 سنوات بهذه الوظائف، وفي حال نقص العدد عن 10 ما الذي سيحصل؟ ولماذا التمييز ضد المحافظات الأخرى بطلب استثمار أقل فيها؟ هل هو بسبب صعوبة الحياة فيها بالمقارنة بالعاصمة فنمنح المستثمر إجازة بقيمة ربع مليون دولار وكأن الاستثمار ضريبة أو شيء مؤلم وغير مجزي؟ الاستثمار يا سادة لا يعامل كالضرائب، فلا تقتدوا بنموذج الضرائب. لقد فشلت الاجازات الضريبية في خلق بيئة جاذبة للاستثمارات في المحافظات.

أيضا من الممكن الحصول على الإقامة في المملكة ولمدّة 5 سنوات "بغضّ النظر عن مدّة إقامة المستثمر سابقاً في المملكة"، عند شراء عقار، وبقيمة لا تقلّ عن 200 ألف دينار (لم لا يكون بالدولار أيضا، لتشجيع الدولرة كما في أعلاه؟)، "حسب تخمين دائرة الأراضي والمساحة" (أي أن أي تخمين آخر لا يعترف به)، مع الاحتفاظ بالعقار مدّة لا تقلّ عن 5 سنوات دون الحق بالتصرف به أو رهنه (حتى الرهن ممنوع!!! ربما الاعتقاد السائد بأن نصابي الأرض سيصطفون للحصول على الجنسية...عيب والله)، كما ان حق الحصول على الإقامة ليس أتوماتيكيا حتى في هذه الحال، بل تصدر الإقامة بقرار من وزير الدّاخليّة وبناءً على توصية اللجنة الخاصّة بالمستثمرين، وحين الاخلال بأي شرط من الشروط السابقة يتم سحب الجنسية أو إلغاء الإقامة للمستثمر...يا سلام... العودة للمزيد من منح السلطات التقديرية للموظف الحكومي لنزيد من وتيرة الفساد... لماذا لا تكون كلها تلقائية؟

أيضا هناك تحديد للأولاد الذين يحق لهم الحصول على الجنسية، لماذا لا يستطيع الاب ان يمنح أبنائه الجنسية بما انه يمتلك جنسية؟

ولكن تتفنن التعليمات لأنه اذا كان الاستثمار يتجاوز الثلاثة ملايين دولار فيستطيع المستثمر ان يمنح أبنائه الذكور وليس "الاناث" ومن تتجاوز أعمارهم الثلاثين عاماً الجنسية، هنا نسأل لماذا ليس الاناث؟ التمييز الجندري موجود حتى هنا؟؟؟؟

هنالك أيضا تعليمات تحدد ان لا يتجاوز عدد المستثمرين في السنة عن 500 مستثمر سنويّاً فقط، وان تجاوز العدد الى 600 مستثمر راغب بالجنسية، فهل نقول للبقية انتم طلقاء حاليا ولا يمكن استقبال استثماراتكم لأننا اكتفينا هذا العام، واذا كان المستثمر رقم 501 ملياردير كبير يريد ان يستثمر مئات الملايين هل ستقول له أيها المشجع للاستثمار انك لا تريد استثماراته؟ هل سنطرد المستثمرين في حال نجحت هذه الاستثمارات في جلب 500 مستثمر في العام!!!

في هذه التعليمات الكثير والكثير مما يوجع القلب ويجعل من هيئة تشجيع الاستثمار هيئة تنظيم او مراقبة للاستثمار بدلا من تشجيع الاستثمار، ويجعل من المستثمر شخص تحت المراقبة لسنوات عديدة، خاضع للتفتيش وزيارات وقرارات اللجان.

Copper and Dana September 1 2021 Jordan Times

 The recent ruckus about the government’s intent upon allowing mining for copper in the Dana Biosphere Reserve (DBR) is well deserved and, speaking from a purely developmental perspective, should have been louder. Furthermore, the government discourse is focused, somewhat naively, on the possible cash flow from converting part of the country’s largest nature reserve into a copper mine, which debases the respectability of the government argument.

The DBR is about 300 square kilometer. It spreads within the Tafileh Governorate, one of the least developed governorates in Jordan. The Dana Biosphere is fantastically unique. It crosses four bio-geographical zones; Mediterranean, Irano-Turanian, Saharo-Arabian, and Sudanian penetration.  The DBR is home to 833 species of plants (one-third of Jordan’s plant species), 215 bird species (50 per cent of all the bird species in Jordan), and 38 mammal species (50 per cent of the mammal species in Jordan). Three of the plant species inhabiting DBR are unique to it, they can only be found there. Moreover, several globally endangered species find sanctuary in the area, such as the Syrian Serin (Serinus syriacus), the Lesser Kestrel (Falco naumanni), the Blandford's Fox (Vulpes cana) and the Nubian Ibex (Capra nubiana). There are about 100 archaeological sites in Dana. Among these are the ancient copper mines in Wadi Feinan, considered as the most important archaeological complex in southern Jordan outside of Petra. Based on all this, Dana is on the tentative list of UNESCO for being included among the World Heritage Sites.

The Global Environment Fund supported the Royal Society for the Conservation of Nature (RSCN) in 1994, to conserve the biodiversity in Dana. They put together the first protected area management plan in Jordan, while making the DBR a model of integrated conservation and socioeconomic development. It is, therefore, apparent why some people are deeply concerned over the current drive to mine copper in the DBR. 

On the other hand, one reason that there is such a desire, among the government and some investor(s), to mine copper now at the DBR is that the world price for copper is currently at JD6,646 per tonne, almost an all-time high; the price of copper increased by 25 per cent per tonne from 2010. It is also five times what it was at the turn of the century.  The cost of mining copper has also been raising and some place it at JD4277 per ton, or 65 per cent of the price. 

One argument in favor of mining copper in Dana is the fact that commercial reserves of copper do exist. However, there is a plethora of complexities that surround such a venture. For starters, given a span of 20 years, the price of copper may revert to its past low levels and render the venture obsolete; the government’s revenue share may be structured to balloon later instead of an earlier date, thus reducing its present value to dismal levels; the costs of mining may rise significantly, especially in a country where energy is extremely expensive; water resources may easily become polluted and a water-poor country may become even poorer (note that copper mining is considered a dirty industry and water has been regarded as its first casualty); and the environment at the DBR may be totally destroyed.  

Moreover, issues such as governance and linkages to the rest of the economy to ensure that the benefits are widespread and sustained should be evaluated. In addition, there should be a comparison between earnings (financial and economic) from the income streams from mining copper and those from having a DBR operating at its full potential. Such are some of the concerns!

Because of the above, the negotiation process should be done by professionals with tremendous experience in the subject. All future payments must be discounted to the present to determine their present value. Policies and programmes that enhance the value added of copper mining as well as other mining activities at the community, regional and national levels should be addressed. All contracts should be subject to the approval of the parliament. The development of human and institutional capacities in host communities to benefit from this should be among the priorities of the negotiation process. In other words, in order for this venture contribute to increased tax revenues, export earnings, employment opportunities, infrastructure development and transfer of technology, these issues need to enter the into the contractual agreement.

A transparent and competitive process is necessary but not sufficient; the process requires a neutral technical adviser such as the World Bank, which has provided technical assistance in 24 countries for 41 mining sectors since 1988.

Jordan, like many other developing countries, should not rush into a mining venture without estimating the socioeconomic impacts and the environmental damage, especially given that it would directly affect the magnificent Dana reserve. Receiving advice, given the current public sector capacities and the threat to DBR, is extremely important right now. Let’s not rush this time, easy solutions are not necessarily the correct ones.

http://www.jordantimes.com/opinion/yusuf-mansur/copper-and-dana