Unease over Jordan-Israel trade
* Last Updated: September 19. 2010 10:49PM UAE / September 19. 2010 6:49PM GMT
ZARQA, JORDAN // Israel’s announcement last week that it planned to export 50,000 used cars to Jordan and Iraq created unease among Jordanian second-hand car dealers while advocates against normalising relations with Israel stepped up calls to boycott Israel-made goods and business dealings.
Since 2006, Jordan has imported nearly US$10 million (Dh36.7m) worth of earth-moving equipment, road-construction equipment, new lorries and cars from Israel, Nabil Romman, president of Jordan Free Zones Investors Commission, said. Each year the Zarqa Free Zone (ZFZ), the largest of five public duty-free zones in the country, imports an average of 120,000 used cars, 40,000 of which are sold to the local market.
But Badi Rafayaa, the head of the Professional Associations’ anti-normalisation committee, said Israel wants to dump old cars, which pollute the environment and cause traffic accidents.
“The move is a clear sign of the Zionist entity’s devious intentions towards Jordan and Iraq … We will cooperate with civil-society institutions and will prevent those plans,” he said.
Among some local dealers, concern about Israel’s intentions were of a monetary nature.
“They are going to be 50,000 cars, a hard blow to my business and to the market,” said Mohammad Kabaireh, general mamager of Al-Safa Car Trading at the ZFZ, which imports used cars from South Korea. “In the past five years, we used to sell up to 50 cars in two months, and now I have cars [stuck] in the showrooms from the past seven and eight months. Any cars that enter Jordan are bound to create competition.”
Kamil Nino, an American-Jordanian investor, has sold luxury cars imported from the United States in the ZFZ since 2007.
“If the cars compete with my cars as a line, this would result in an unfair competition,” he said. “Definitely the prices will fall especially since shipping costs are much lower because of the proximity between Jordan and Israel. We pay an average of $2,000 to ship a car from California to the ZFZ, but shipping from Israel will be a fraction of the price. This would kill our prices … For now, I have just asked my brother in the US to put the car exports to Jordan on hold.”
However, other car dealers shrugged off concerns about competition. “Imports of older cars manufactured before 2009 would not affect our business,” said Ahmad, who did not want to reveal his last name. He sells cars in Jordan and also exports them to Libya, Iraq, Saudi Arabia and the Gulf. “In fact, we export to Arab-Israeli car dealers. Just two months ago, we exported 200 Hyundai cars there,” he said.
Mohammad Bustanji, another car dealer, said he doubted used-car imports from Israel would affect his business since he also deals with mostly with new cars and late-model used ones. He added that he thought the cars from Israel would not make their way to many showrooms because of political reasons.
“I doubt any car dealer would dare to purchase the cars,” he said. “Once the cars enter the market from Israel, it would be difficult for customers to tell where they come from, but it will not be difficult in the zone to find out who would purchase these cars. In this case dealers would not even greet him. We are against the move, first and foremost because the cars would come from Israel.”
Mr Romman of the investors commission said cars imported from Israel would not then be shipped to Iraq because they will be older models. Four years ago, Iraq started requiring imported used cars to have been manufactured within two years.
“While Israel places higher specifications on cars, the ones that enter the zone can be of better quality and would present a business opportunity for many dealers here,” he said.