Cablegate: Jordan's Qiz Managers Seeking Conference During

This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS AMMAN 006517

SIPDIS

STATE FOR E AND EB/CBA - MERMOUD
STATE PASS USTR FOR NED SAUMS
COMMERCE FOR 4520/ITA/MAC/ONE/LOBERG

E.O. 12958: N/A
TAGS: ETRD EINV BEXP IS JO
SUBJECT: JORDAN'S QIZ MANAGERS SEEKING CONFERENCE DURING
FTA JC

REF: A. AMMAN 1892
B. AMMAN 5485

1. (u) Summary: Building on U/S Larson's visit to Amman
last month, QIZ park managers and GOJ officials are proposing
an investment promotion event to coincide with the December
11-12 FTA Joint Commission meeting in Washington. We believe
such an event could help encourage both new QIZ investment
and encourage the diversification of Jordan's economy away
from dependence on Iraq. We are prepared to assist in
planning for any such event. End Summary.

2. (u) In the past two weeks, we have been approached by
QIZ park managers Halim Salfiti (Al Tajammouat), Jack Khayyat
(Al Dulayl), and Amr Majali (Irbid/Kerak/Aqaba), as well as
by Jordan Investment Board Director Reem Badran and QIZ
"forefather" Omar Salah, about the possibility of setting up
a QIZ-related event to take advantage of the planned FTA
Joint Commission meeting in Washington in mid December. They
picture an event similar in structure and goals to an event
they attempted unsuccessfully to launch in Jordan earlier
this year (reftel). They propose a U.S. Government-hosted
conference with either CEO's or Sourcing/Buying VP's from
major U.S. retailers, along with senior representatives from
the U.S. Association of Importers of Textile and Apparel
Products (USAITA). Such an event, they believe, will not
only encourage more sourcing from Jordan, but will also
provide the positive PR necessary to coax additional
third-country investment in the QIZ's.

3. (u) As discussed during U/S Larson's visit to Amman and
Omar Salah's meeting in Washington with DoS Business
Coordinator Mermoud, such an event would provide a forum to
address particular concerns U.S. companies have, either as
buyers or investors, regarding political risk factors in
Jordan - specifically, how the Intifada and the prospect of
war in Iraq are affecting QIZ production, and how the GOJ and
park managers plan to mitigate those impacts. While a number
of U.S. retailers are represented in the QIZ's, a number of
influential companies (notably GAP, Inc. and Victoria's
Secret) have cited these political risks as a primary reason

SIPDIS
for withholding orders and investment.

4. (u) Minister of Industry and Trade Salah al Bashir, who
will lead the Jordanian delegation to the Joint Commission,
supports this initiative. We continue to believe in the
concept to encourage and bolster the QIZ initiative, which
has been successful beyond expectations, but still can make
greater contributions to Jordan's economic growth (ref b).
Given the current uncertainties about the economic fallout of
possible military action in Iraq, such an event would be a
timely complement to the official JC meetings. It would also
provide substantive press coverage for the FTA/JC and real
business opportunities in the QIZ's. In particular, QIZ
managers will be able to pitch major retailers who have been
reluctant to begin operations in Jordan because of their
concerns about possible disruptions in supply resulting from
either coalition activity in Iraq or an exacerbation of the
Israeli-Palestinian conflict.

5. (u) We think a meeting at the State Department chaired
by U/S Larson and Minister Bashir would be a natural
follow-up to the Under Secretary's visit to Jordan and would
provide the pull necessary to bring major garment retailer
CEO's and/or senior VP's, along with senior representatives
from USAITA, to the table. We would be happy to help put
such a conference together.
GNEHM

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