Jordan, Palestine Sign Free Trade Agreement

Palestinian Prime Minister Salam Fayyad and Jordanian Prime Minister Fayez Tarawneh announced the signing of a number of agreements, most importantly a free trade agreement, at a press conference in Ramallah on Thursday.  Tarawneh was in Palestine to participate in the third meeting of the Joint Jordanian-Palestinian Higher Committee, which held its last session in 1998.

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At the press conference, the Jordanian prime minister stated that the trade volume between Jordan and Palestine is “below aspirations,” and called for the resolution of “technical difficulties” in order to increase trade.  Trade between the two stood at about $105 million in 2011.

Tarawneh also expressed Jordanian support for the Palestinian cause, calling for an end to Israeli occupation and the implementation of a two-state solution.  During his visit, he also met with Palestinian President Mahmoud Abbas, and conveyed King Abdullah’s greetings to him, the government, and the Palestinian people.

Prime Minister Fayyad at the press conference highlighted the current difficult situation being faced by the Palestinian Authority.

The trade agreement comes at a particularly sensitive time for the Palestinian economy.  The Palestinian Authority is in the throes of a major funding crisis, as it is unable to pay its employees and creditors in a timely manner, but is no longer able to secure funding from local banks to make up for the shortfall.  The most immediate cause of the PA’s difficulties is the sharp decline in foreign aid as international donors cut back during the global financial crisis, and Arab states do not fulfill their pledges.

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