Moving forward: Well-developed road and air networks compensate for a weak rail system

Up to this point, Jordan’s transport sector has been dominated by road infrastructure, with the aviation network and the seaport at Aqaba also playing important roles. Though less well developed, the country’s rail network is now the focus of government-led modernisation and expansion plans.

In addition to linking the existing rail lines, these plans aim to connect the Jordanian rail system to networks in neighbouring Saudi Arabia and Iraq, for which Jordan is an increasingly important transit route. There are also plans for a much-delayed light passenger railway. Other expansion projects are under way at Jordan’s main airport and the Aqaba seaport, which has seen increased volume in recent months due to turmoil in Syria among other factors.

The Jordanian transport sector accounts for around 12% of GDP and employs approximately 10% of the country’s overall workforce, according to figures cited by the Ministry of Planning and International Cooperation in January 2012.

INTERNATIONAL COMPARISONS: Jordan’s transport infrastructure is internationally well regarded in several areas. The World Economic Forum’s 2011-12 “Global Competitiveness Report” gave the kingdom’s air transport infrastructure an average score of 5.6 out of 7 (7 being the best possible score), ranking it 34th out of 142 countries, and a score of 5 out of 7 in road transport, ranking it 47th.

However, Jordan’s port at Aqaba scored 4.3 out of 7, ranking it 63rd, and the country was given 1.5 out of 7 for rail transport (107th place). Both segments, however, are subject to ambitious development plans that should boost their competitiveness.

“Jordanian transport infrastructure is not in bad shape at all. Nonetheless, it needs to improve,” said Abdullah Jbour, the executive manager of the Jordanian Logistics Association, which represents 82 freight forwarders and logistics service providers. The association also plans activities for firms in the sector, such as training and advocacy programmes.

Data suggests that the business environment is also reasonably advantageous for the transport industry. Jordan ranked 58th out of 183 countries in the “Trading Across Borders” category of the World Bank and the International Finance Corporation’s (IFC) “Doing Business” report, based on the time, number of documents and costs required to import and export standard 20-foot containers. Although it ranked ninth out of Middle Eastern and North African countries in the report, Jordan outperformed the regional averages in five of the six indicators for the category. For example, the number of documents and time required to import a container stood at 7 and 15 days, respectively, compared to averages of 8 and 24 for the Middle East and North Africa.

AIRPORTS: The country’s main airport is the Queen Alia International Airport (QAIA), which is located 35 km from Amman and has operated since 2007 by Airport International Group (AIG) under a 25-year build-operate-transfer (BOT) contract. The airport is built on a 19m-sq-metre site that includes two 3660-metre-long runways, parking space for up to 32 planes and two passenger terminals with a combined 68,000 sq metres of floor space.

The intended annual capacity of the airport’s two existing passenger terminals is around 3.5m; however, in 2011, almost 5.5m passengers passed through them, putting a strain on the facility. To address this, in addition to refurbishing the existing terminals, AIG is building a new $750m, 103,000-sq-metre terminal at the airport, and has so far spent $100m on rehabilitating the existing infrastructure, funded by a combination of equity, commercial loans and loans from the IFC and the Islamic Development Bank.

The terminal, designed by the UK’s Foster + Partners, was 85% completed as of June 2012. All major construction is expected to be concluded by the end of 2012 and will have a capacity for 9m passengers per annum, with future expansion to 12m passengers per annum. “The new terminal at QAIA will attract more airlines and enhance passenger growth and transit journeys, especially given unrest in the region,” said Naim Hassan, the planning and studies director at the Ministry of Transport (MoT). “Travellers want safe transit and final destinations.”

Passenger traffic through QAIA grew by less than 1% for 2011 as a whole, to 5.47m, according to figures from AIG. However, early 2012 saw rapid growth, with 2.4m passengers travelling through QAIA in the first five months, an increase of 21.5% year-on-year. Cargo passing through the airport grew by 7%, to 37,000 tonnes. Aircraft movement from January to the end of May also recorded positive growth with over 26,500 movements, a 7% increase compared with the same period in 2011.

The country’s second major airport is King Hussein International Airport (KHIA) in Aqaba, which has one single 3000-metre runway and an annual passenger capacity of 500,000, to be expanded to 600,000 under a tender launched by the Aqaba Development Corporation. The airport saw a total passenger volume of 205,402 in 2011, slightly down on 2010 figures of 220,590, according to MoT statistics. Located in Aqaba’s Special Economic Zone, the airport operates under an “open skies” policy distinct from the national regulatory framework.

The country has a third airport, Amman Civil Airport, at Marka in east Amman. This facility hosts a number of smaller and charter airlines such as Jordan Aviation, Royal Wings and Royal Falcon. Some 305,234 passengers travelled through the airport in 2011 according to data from the MoT, up sharply from 215,698 the previous year, though aircraft movements were more or less unchanged at 9423. MoT figures show that 2580 tonnes of cargo also passed through the airport, up from 1823 tonnes in 2010.

AIR CARGO & LOGISTICS: While passenger numbers are increasing and set to receive a boost from the new terminal at QAIA and smaller-scale upgrades at both its existing terminals and at KHIA, logistics industry players complain that there has been less of a focus on the development of the cargo and logistics side of the business. “The transport infrastructure in Jordan is underdeveloped compared to the wealthier countries in the GCC, especially in the aviation sector,” said Faraj Bassil, the country manager of Aramex, a global provider of logistics and transport solutions. Aramex has rapidly evolved from its early days in Amman in 1983 into a global company that employs more than 12,300 people in 353 locations across 60 countries worldwide.

“The courier and freight facilities in Jordan’s airports are very mediocre, and while the QAIA is undergoing an impressive and comprehensive expansion, the focus of the expansion has been on the passenger terminal, while the facilities serving air freight will not undergo any revamp,” Bassil said, adding that the new courier centre being developed by Royal Jordanian is not expected to improve the situation. “It is true that the passenger terminal needed improvement, but hopefully there will be more focus on freight in the next phase,” Bassil told OBG.

NATIONAL CARRIER: The country’s national flag carrier, Royal Jordanian, had a market share of 59.8% in terms of aircraft movements at its central hub of QAIA in 2011, up slightly from 58.9% in 2010, according to data from AIG. In addition to its services at the airport itself, Royal Jordanian also operates an Amman City terminal at the seventh circle in west Amman for early boarding services. It has been part of the oneworld alliance since 2007, when it became the first Arab airline to join an international alliance.

As of late 2011 the company operated flights to 59 destinations worldwide and had a fleet of 33 aircraft. This was primarily made up of Airbus planes (four Airbus A319s, seven A320s, four A321s, two A330s, four A340s and four A310s, including two specialised in cargo) aircraft, as well as three Embraer 175 and five Embraer 195 planes serving short-haul routes in the Levant and nearby countries.

The company is in the process of phasing out six of its planes and replacing them with seven newer ones of the same model. It is also expanding the range of its fleet, with 11 Boeing 787 Dreamliners currently on order and due to be delivered in 2014. The new planes will replace the Airbus A330s and A340s currently in use on the airline’s long-haul routes.

Royal Jordanian was privatised through the flotation of a 71% share on the Amman Stock Exchange in 2007. As of the end of 2010 the Jordanian government held a 26% share in the airline and the state-backed Social Security Corporation owned a 10% stake, while Mint Trading Middle East possessed a 19% share. No other entity has a stake larger than 5% in the air carrier and out of 84.4m outstanding shares, 28.2m are on a free float.

The firm owns a charter operator and agent, Royal Wings, and an 80% stake in a marketing and ticketing agency, Royal Tours. It also has a monopoly on air freight services at QAIA. In January 2012 the company said it planned to open a new warehouse for courier firms operating at the airport, for which it will also provide handling services.

TOUGH CLIMATE: Although the airline’s passenger numbers increased to 3.2m from 3m in 2010 according to data published by Awraq Investments, 2011 was nonetheless a difficult year for the firm, owing in large part to a tough climate for the wider industry due to factors such as increasing regional terminal and fuel costs. “Some 40% of our expenses go to fuel,” Hussein Dabbas, former president and CEO of Royal Jordanian, told OBG. “Energy costs in 2011 were 50% higher than in 2010, and in 2010 costs were 100% higher than in 2009.”

Due to adverse market conditions, the flag carrier cancelled more than 1500 flights in 2011; it also suspended operations to Brussels and extended its agreement with Gulf Air in early 2012 whereby Gulf Air will operate flights but both carriers will market them. In addition, an agreement with the Jordanian Civil Aviation Regulatory Commission that limited competition on international flights from Amman expired the previous year, increasing pressure.

Company revenues stood at JD542.8m ($762.74m) for the first nine months of 2011, up from JD515.8m ($724.8m) in the same period in 2010, according to the firm’s financial statement for 2011’s third quarter. However, the firm lost JD42.3m ($59.43m) in the period, compared to a profit of JD19.8m ($27.82m) in the first three quarters of the previous year.

NEW ROUTES: While regional instability has had negative consequences for the carrier, including route cancellations, the unrest has actually helped to drive growth in some respects. In January Royal Jordanian announced that it was opening a route to Misrata in Libya, its third Libyan destination after Tripoli and Benghazi. The company said the decision to open the new route was driven by high demand from Libyans seeking medical treatment in Jordan, which is a top medical tourism destination (see Tourism chapter). The same month the airline was reported to be considering opening cargo routes to the same three Libyan cities.

As part of its growth strategy, Royal Jordanian is also increasingly targeting new African markets. The firm launched a new service to Nairobi in December 2011. The airline is also considering opening new routes to Algiers and other destinations in the future. “Many African economies are booming and becoming more politically stable, so there is immense untapped potential,” Dabbas told OBG. “That being said, a challenge [for Royal Jordanian] is the fact that, outside of South Africa, Jordan doesn’t have embassies in that part of the world, which creates visa barriers for business expansion.”

Meanwhile, boosting air traffic to Jordan will require attracting more tourists to the country. “Jordan needs to do a better job of promoting itself as a travel destination,” Dabbas told OBG, echoing concerns voiced by tourism industry figures who have highlighted the need for additional government funding to promote Jordan abroad (see Tourism chapter). “The country needs tourism infrastructure in foreign countries to advertise and offer promotions,” he said.

THE COMPETITION: Another local airline is Jordan Aviation, which operates scheduled and chartered flights. It also leases its aircraft to other operators. The firm has a fleet of 15 aircraft, namely eight Boeing 737s, three Boeing 767s, two Airbus A310s, and one Airbus A320 and A330 each.

The low-cost sector is also growing in Jordan. In 2010 Sharjah-based Air Arabia announced the creation of a joint venture Jordanian budget airline called Air Arabia Jordan with Tantash Group, a local tourism company. Air Arabia also announced its intention to use Amman as its fourth regional hub (after its existing hubs in Sharjah, Casablanca and Alexandria). However, in June 2011 the airline announced it was going to put the plans on hold due to regional instability and rising fuel prices.

Nevertheless, the sector is gradually making inroads. In March 2011, UK-based low-cost carrier (LCC) easyJet launched a London Gatwick-QAIA service, representing a major landmark. Other LCCs operating through Jordan include Jazeera Airways, nas air and flydubai. Overall, the LCC segment has a market share of around 10% at QAIA.

SHIPPING: All shipping activity takes place at Aqaba, the country’s sole seaport, which is on the Gulf of Aqaba. The port is currently divided into three different parts: the main port is close to the town; the middle port, which includes the container terminal, is just south of the city; and the southern industrial port is near Jordan’s border with Saudi Arabia.

The main port handles general cargo, grain and phosphate exports and consists of 12 berths of a combined length of some 2120 metres. Under plans to develop Aqaba, its activities are scheduled to be moved to the southern industrial port, where new facilities are being built.

The middle port is made up of seven berths of a total length of 1000 metres. These include a roll-on/roll-off berth and Aqaba’s passenger terminal in addition to the container port, which comprises three berths of a combined 540 metres. The port also handles livestock, cement and rice.

Total passenger numbers travelling through Aqaba stood at 810,695 in 2011, down from 914,937 in 2010, according to Aqaba Ports Corporation (APC) figures. The reduction is likely explained in part by the Egyptian government’s decision in June 2011 to close the Aqaba-Taba ferry line. As of March 2012 the Jordanian and Egyptian authorities were holding negotiations to reopen the service.

The southern industrial port comprises an oil jetty, a timber berth and a two-berth industrial terminal that handles industrial and chemical materials such as ammonia, fertilisers, potash and sulphur. Its four berths have a combined length of 640 metres.

BY WEIGHT & VOLUME: Jordan’s shipping industry had a good year in 2011. The weight of goods transported through Aqaba’s ports grew by close to 14% in 2011 on 2010 figures, to 19.2m tonnes, according to figures from the APC. Throughput was also up 12% year-on-year (y-o-y) in the first two months of 2012. The volume of goods coming into and leaving the Aqaba container terminal increased by 16.5% in 2011 to reach 705,648 tonnes, with imports up 19.1% and exports up 13.6%. Refrigerated container goods imported and exported increased by a total of 17.9%. Aqaba’s importance as a transit port for nearby countries such as Iraq, in addition to Jordan’s limited export of goods, means that it is primarily a destination port, with around 80% of containers heading out of Aqaba empty.

REGIONAL DEVELOPMENTS: Although important segments of the Jordanian economy have been negatively affected by the instability in the Middle East in 2011-12, the shipping industry has benefitted from regional developments, which have played an important role in boosting port activity.

“A significant proportion of Aqaba’s port business last year was originally intended for Tartous in Syria,” Mohammed Mubaydeen, the acting director-general of APC, told OBG. “The crisis there has been bad for Jordanian tourism, but positive for logistics,” said Mohammed S Turk, the former CEO of the Aqaba Development Corporation.

Problems in Syria have boosted car imports in particular through Aqaba. While volumes have not been quite as large as initially expected, developments in Libya also mean further increases are likely. Demand for imports in Libya has grown since the economy was liberalised following the regime change in 2011. Libyan businessmen are increasingly using Aqaba to import goods to Libya as a result.

EYE ON THE IRAQI MARKET: While around 6% of imports into Aqaba were classified as transit goods rather than imports to Jordan according to port statistics from the APC, officials estimate that the ultimate destination of as much as 40% of the inbound cargo at Aqaba is actually Iraq. “Iraq is still rebuilding and needs to import a lot,” Moha’d Dalabieh, the former director of the port at Aqaba, told OBG. “Their own port of Umm Qasr [in the Gulf] cannot handle all the traffic and is often beset by delays,” Dalabieh said. Soren Hansen, the CEO of Aqaba Container Terminal (ACT), put the figure even higher, saying that more than 50% of cargo passing through the terminal is believed to eventually end up in Iraq. “The competitive landscape for servicing Iraq has changed markedly in recent years, with Iran and Turkey emerging as new gateways into the country,” he said.

“The competition is intense, with a few other ports also able to handle big ships,” Hansen said. “Aqaba, however, has a key advantage given its proximity to Red Sea and the main Asia-Europe routes, enabling us to serve East Asian markets well.” Aqaba’s ability to receive the largest container ships (those up to 8000 20-foot equivalent units) and ACT’s work containerising bulk cargo is also helping to boost competitiveness, Hansen said.

So too is the performance and efficiency of local Customs at the port, an aspect which has helped to draw in foreign clients, particularly from Iraq. “Iraqis also feel comfortable using Aqaba and tend to become repeat customers; it’s very efficient at bulk unloading and it is not a corrupt port,” said Dalabieh.

REGIONAL TURMOIL: Problems in Syria have also boosted the attractiveness of Iraq as a potential transit route for exports such as vegetables from Jordan to Turkey and Europe. Around 3000 Jordanian trucks a month pass through Syria carrying Jordanian goods, but the violence there has led to security concerns, high insurance costs and delays caused by stepped-up border controls, which can be disastrous for perishable goods. “While trade routes between Jordan and Syria are still open, there are significant delays and congestion at border crossings, and it is unclear for how long we can maintain the viability of the route, especially with the increasing costs of insurance”, Bassil told OBG in March 2012.

In September 2011 the Jordanian and Iraqi authorities reportedly agreed to put in place new measures and rules that would allow for transit journeys through Iraq. Then in December of that year, the Jordanian authorities said their Iraqi counterparts would open the route within a month. This was followed by a statement in February 2012 from Iraq’s transport minister, Hadi Al Amiri, who said that Iraq had “in principle” agreed to allow Jordanian vehicles to pass through the country on their way north.

However, Iraqi authorities have also repeatedly said they need time to undertake the regulatory and logistical changes to make this happen, noting that Iraq has had no transit trade for around two decades, and some industry analysts are sceptical that a full agreement will be reached any time soon. “Jordan’s road network is well connected to Iraq, but political negotiations between the two countries will have a greater impact on the volume of bilateral trade than logistics,” Atef Abed Al Rahman, business development director for Jordan Post, told OBG.

While Aqaba is becoming an increasingly important port, Jordan does not currently have a major domestic maritime fleet. “When Jordan joined the WTO, it had to eliminate special treatment for Jordanian vessels, which removed incentives for ships to register under the Jordanian flag,” said Dalabieh. “That, combined with the fact that Aqaba is primarily a destination port, means that there is little in the way of a national fleet and the Jordanian ships that do exist are often cross-registered, which is a shame. It is also problematic because a fleet is a hedge against the risk of hard times and war and makes a country more secure in terms of cargo.” According to Dalabieh, the maritime industry is calling on the government to help facilitate building a fleet, whether through direct subsidies, persuading banks to offer more financing or giving Jordanian-registered ships advantages at Aqaba. “The economy and fiscal situation are bad now, so we cannot realistically expect the government to subsidise the creation of a national fleet at the moment, but in the long term it should be a priority,” he said.

ROAD TRANSPORT: As of 2011 the Jordanian road network consisted of 2878 km of main roads, along with 2592 km of rural roads and 1733 km of side roads, according to data from the Ministry of Public Works and Housing. “The road network across Jordan, despite the improvements of certain highways, could also be better, enabling us to further develop our services and cater for our local and regional customers,” said Aramex’s Bassil.

A number of major projects and studies are under way to develop the network. In 2002 the ministry launched a $1.8bn-plus, 25-year master plan with the goal of extending a modern road network across the kingdom, including remote areas. Then, in 2009, the ministry launched a 20-year national highway master plan to study the needs of the existing road network and further develop it.

In October 2011 it was reported that the highway from Amman to QAIA, which is in the process of being widened to three lanes in each direction, would become the country’s first toll road, in a possible model for the development and financing of future road construction and upgrades in Jordan.

FREIGHT: As of 2010, there were 15,874 heavy trucks in operation in Jordan according to figures from the Land Transport Regulatory Commission (LTRC), giving the country one of the largest trucking fleets in the Middle East. Of these, 60% are owned by individuals. While the size of the fleet is an advantage for Jordan, various aspects of it have come in for criticism. “The domestic truck market is fragmented and quasi-regulated which presents some challenges to the stability and reliability of the overall supply chain. It is important for Jordan’s success as a strong gateway that all components of the chain work seamlessly and in harmony,” Hansen said.

The third competitiveness report on the transport sector, published in January 2012 by the Jordan National Competitiveness Team research unit of the Ministry of Planning, said the fleet was old. According to data from the LTRC, around 60% of heavy trucks operating in the kingdom in 2010 were manufactured before the year 2000, though over half of these were built between 1995 and 1999.

In 2011 and early 2012 the road freight sector was, like other parts of the economy, hit by repeated industrial action, causing discontent within the industry. Truck owner-operators went on strike and on occasion blocked the Aqaba port to protest what they said was their low market share compared with trucking firms. To remedy this, they called on the government to facilitate the creation of a private firm encompassing owner-operators. The government reportedly approved the request in September 2011, but truckers held further strikes over delays in implementation. An LTRC decision to do so in March 2012 appeared to put an end to the action.

PUBLIC & URBAN TRANSPORT: Public transport largely consists of public and private mini-buses and buses. As of 2010 there were 744 buses, 1341 medium-sized vehicles and 577 small vehicles operating the country’s 597 main public transport routes, according to figures from the LTRC. There were also 634 large buses operating on internal city public transport routes, as well as 3138 medium buses and 3419 small vehicles, with a total of 1566 routes, 300 of which were in the capital.

In January the LTRC announced that it had launched a study aimed at enhancing public transport across the country, including in remote areas, and in particular rebalancing the distribution of public transport provision, which the LTRC says is inadequate in some areas while exceeding local needs in others. The study, which will take one year, is to be carried out by German consultancy Light Rail Transit Consultants and a local company. “We are trying to encourage everyone to use public transport, especially buses and mini-buses, though we are still a long way off and in some areas it currently is not feasible,” said the MoT’s Hassan. “Among other benefits more use of public transport would lower the energy and fuel bill for the government.”

In 2010 the Greater Amman Municipality (GAM) began construction of a bus rapid transport (BRT) system that would see the creation of segregated roads dedicated to buses along main routes through the city, similar to Istanbul’s Metrobus system and Tehran’s BRT network. Under the plans, three lines with a combined length of 32 km were to be built at a cost of JD500m-850m ($702.6m-1.19bn), with construction expected to last four years. However, in August 2011 local press reported that the project was facing significant opposition within GAM, despite a positive assessment from a government review committee, and its future is currently unclear.

RAIL: The rail network consists of 620 km of track, divided between two lines. The 293-km southern line, operated by Aqaba Rail Corporation, connects phosphate mines in the vicinity of Maan to the port at Aqaba, and is more or less only used to transport phosphates. A second, 328-km line operated by the Hejaz Railway Corporation runs from Amman through the Syrian border and on to Damascus. This second line is also used for freight but runs some passenger trains, including chartered trains for school outings and tourist groups.

The government has launched a national railway project with the aim of upgrading and expanding the rail system into an 897-km modern freight railway network. The network will link to the existing southern line to the Hejaz, meaning the new network will stretch across the country from Aqaba in the south to the northern border with Syria. Another line will run east from the north-south line at the industrial city of Zarqa, splitting in two to link the network to both Saudi Arabia and Iraq. The project, which is initially aimed primarily at the freight market, envisages the network carrying 29m tonnes per annum (tpa) of freight by 2020 and 55m tpa by 2040.

Under the project, the state-owned Jordan Railway Corporation (JRC) will finance, construct and manage the network infrastructure at an investment cost of around $2.96bn, while a private company will be given an operating concession for a minimum of 30 years and will be responsible for buying and managing the rolling stock. Construction of the new rail network is scheduled to take four years to complete and is due to begin in 2012, although according to Hassan of the MoT this may be pushed back to 2013. The awarding of the operating concession is also due to take place in 2012.

While the need to improve the railway network has long been recognised, some industry figures are optimistic that there is now light at the end of the tunnel. “The government is now serious about looking at rail,” said Dalabieh. “There are clear signs of movement, with lots of meetings taking place on the topic. The Jordanian logistics market already has numerous advantages; if rail is there too, Jordan will achieve a lot.” Industry figures say that it is crucial the project go ahead without further delay. “Without developing railways within Jordan and the wider region, there is no future,” said Jbour. “Rail would make a big difference to the logistics industry and the national economy given its safety and reliability. The government needs to ensure that the project really moves forward, as the more delays there are, the more costly it will be for the country.”

A separate project is in the pipeline for a 26-km passenger light rail line linking Amman to the nearby industrial city of Zarqa. The project, which will entail investment of approximately $300m, is comprised of a 28-carriage electric train expected to carry around 100,000 passengers per day between Amman’s Raghadan station and New Zarqa in the north of Zarqa. The railway, the conception of which dates back to the 1990s, was initially delayed by difficulties in attracting bids for its public-private partnership concession, and then by the inability of the Spanish-Kuwaiti consortium that was initially awarded the contract for the project to raise financing. The line was originally set to be completed by 2011.

This led to the cancellation of the award and a dispute between the company and the government. In March the MoT said it had won an international arbitration case over the dispute. The project was initially conceived of as a build-operate-transfer (BOT) public-private partnership but as of March 2012 the government was deliberating over whether to stick with the choice or look at other models.

CUSTOMS: Industry players that OBG talked to are largely unanimous in praising the country’s Customs administration. There is a high level of engagement between the Jordanian Customs Department and the local private sector. In 2011 and 2012, there were significant developments in technology used by Customs, with the introduction of an advanced system that has sped up transactions and reduced time for certain procedures from days to hours.

Attitude plays an important role in this as well, according to Jbour. “The service sees its role as facilitating trade, not just taking money, and is always ready to resolve problems,” he told OBG. “Not only is the service the best in the Arab world, it’s ahead of the industry itself in many respects.”

OUTLOOK: “Given its location and the fact that Aqaba is primarily a destination port, we have to be realistic and admit that Jordan is unlikely to ever become a true regional transport hub,” said Dalabieh. “However, it should be a good hub for not only the local market but also Iraq. No port can compete with Aqaba as a transit port for Iraq given its good draught and the size of the Jordanian truck fleet.”

Regional developments appear set to continue to have a mixed impact. While dragging on the wider economy and causing problems for exports north, unrest in Syria, if it continues, is also likely to keep boosting activity at Aqaba. The year 2012 is expected to be better than 2011, but it will take time before Jordan returns to pre-2009 levels, said Aramex’s Bassil. The downturn is supporting some other services such as third-party logistics and warehousing, however. “Fixed costs become comparatively more expensive when volumes are down, which means companies focus more on core activities and become more willing to outsource in non-core areas.”

In the longer term, moves to modernise and strengthen the legislative framework are set to aid the overall transport sector. A key challenge will be ensuring that development of the national railway goes forward. If successful, the light rail project would represent major progress towards the development of a modern multi-modal transport system.