Welcome everyone
this is Mohammad Qara'een
CEO of Kilograms Experience Design
the host of today’s event
 In the beginning
 I’d like to welcome you all to the first virtual forum “Rebooting the Economy 2020”
 As many global and local changes are taking place
 we need to follow up the economic and social situation
Today we aren’t aiming to provide solutions or suggestions
 we are just providing a study of the current situation due daily changes and people’s uncertainty
 and we will share the speaking experts’ experiences in their different fields
and in the following session tomorrow and after we will meet up with experts and owners of small
 medium and large companies in order to exchange experiences during the current situation
Before continue talking about the forum and to have a smooth experience during this forum we need to consider some points
 please use speaker view not the gallery view to lower the bandwidth and make it suitable for your devices
 if you have any questions to the experts related to this session please send them to the user named “Questions”
 if you have any technical question you may directly share your questions and chat with the available support teams
under the users named “Technical support 1, 2 and 3”
there won’t be  a direct chat between the attendance and the sparkers;
we will spend the first 45 minutes with our speakers talking asking questions
 and getting benefits from their experience then we will receive the attendance questions
 for better bandwidth utilization we apologize that we won’t be able to share your audio or video
In the right hand side you may see “Chat to Everyone” which we will use to send messages to the attendance with our contacts on social networking and for other purposes
I’d like to welcome our guests we have today a selected speakers
 First I’d like to welcome Dr. Mahmoud Sarhan
 The Sr-Scientific Healthcare Advisor at Saudi Jordanian Investment Fund Co and stem cells transplantation and tumors consultant; 
we also welcome Mr. Jawad Abbasi a well-known writer and analyst
and Mr. Wagdi Makhamri
capital markets and investment expert
and Mr. Tariq Al Amad
the executive director of the European Jordanian company for renewable energy projects
welcome everyone
Good morning
Today we will address many topics related
to the processes and techniques of restarting operations and business
continuity and resilience
People are worried
and concerned about after corona and about countries’ abilities
to provide treatment, protect individuals, and to improve the economy again,
even though and through the history wars and pandemics have been always a force for development in many countries
I’ll provide simple examples
in the fourteenth century in Europe the Black Death moved it outside the dark ages
in other words, the middle ages, the Hundred Years' war between England and France
stimulated the agricultural sector
the Dot-com crash
produced internet pioneers and startups surge all around the world
SARS-1, which is now Covid-19
produced Alibaba, E-payment, and E-commerce
lately, the crash in 2008  resulted in many companies like Airbnb and Uber
also many other economic models like the so called “The gig economy”.
Uh.
In spite of the measures taken in many countries like quarantine, lockdown, and curfew
these countries included Jordan which took a strict measures
we’ve noticed a change in our habits regarding business models or our daily habits
now we use electronic platform for shopping, applied distance learning, started learning TV channels
we even now have E-government and many electronic applications
the current economy is described as "The on-demand economy” and today with the attendance
we will address possibilities of restarting distance or on-demand economy and economy revitalization after Covid-19.
Our first question for Dr. Mahmoud Sarhan. Hello doctor.
Hello
What’s’ your opinion about the current situation? Please give us a brief about the global situation,
the global efforts against the virus, and what are the possibilities of having a final and near solution for the virus?
Thank you and good morning for you all
First, I’d like to explain the confusion between the two words, Corona and Covid-19
Corona is Virus while Covid-19 is the disease resulting from corona infection
the disease affect range from mild symptoms to death
until today’s morning and globally, there are 2.5 million cases
30% of them are in United Sates of America and 40% are in Europe, means that 70% of world cases are in USA and Europe
which both comprise only 15% of worldwide population
they both has a population of  1.1 billion out of 7.5 billion worldwide population
so it’s now well known for everyone that the virus hit the macroeconomic
It’s very important for audience and speakers to know that the pandemic or the epidemic is pretty much controlled in many countries
without a vaccine but through social distance, large scale authority lockdowns like China did
Jordan is considered following the same path
and sterilizers; in the last two weeks we became more optimistic that we might be able to control this disease
even without a specific cure for the corona virus or after creating a vaccine
As you may know that the first case was diagnosed on November 2019 but was announced in late December
while Youhan city start to open gradually 90 days from December 30
and now 30 - 40 % from Youhan economical activities is back to normal
If we moved to Jordan as a nother example, the first case
which almost everyone know his name, appeared 50 days ago on March 2, 2020
I’d say again that social distance and lockdowns in Jordan were successful
in the last week, the government started reducing the lockdowns and allowing people to gradually restart their activities
today, we have 30% of sectors operations are back to work and we hope to increase that rate gradually
accordingly, I’d like to focus on the point that without an effective cure or a vaccine for corona virus
it was largely controlled through social distance and following necessary precaution
and many countries in Europe including Germany started returning to normal condition
USA is being fidget about it
sometimes they say everything is ok and sometimes it’s not
but they are moving to the peak and then numbers will start falling
as we noticed in many countries around the world, controlling the virus was possible through means like social distance and applying lockdowns
the countries which started these countermeasures earlier have been less affected compared to late countries.
I have a quick question doctor, when it’s expected to have a vaccine? One month, two months days, six months, or a year?
The vaccine shall be developed, tested on laboratory animals, tested on human volunteers to make sure it doesn’t cause problems
in general, there is a global debate about vaccines and its relation with autism
vaccines are being given to children from the age of two months to the age of 5 years
vaccine must be proved not to cause more problems than covid-19 itself
I don’t believe we will have  a vaccine before the end of this year or even the middle of the next year 2021
in other words, from 6 to 10 months from now.
Thank you Doctor, moving to Jawad, thank you for being with us
please give us a brief about the global statistics in economic, financial markets, aviation, oil
and the governments’ losses in impacted economic sectors, we will address other topics in details after this brief.
First, I’d like to thank you for organizing and hosting this conference
The blurring vision of the current situation is the most important point that we are globally suffering
like shutting off global trade and markets to fight the virus without knowing the trades return date
we only have expectations about the return date
the World Bank expectations for global economic growth that the countries which had a trade shutting due to corona virus
will encounter a recession during the shutting period, China announced 10-15% economic recession in the first quarter
and expected recession rates for industrialized economies is 10% in the second quarter compared to the previous year
powerful industrialized nations were able to perform a huge fiscal stimulus which reached 10% of economy
3 trillion, in USA and they are negotiating to add half trillion, Britain also put 10% of its economy which includes the salaries support of locked down businesses like restaurant
but for USA, which have a more flexible labor force, they didn’t follow the Britain measures, instead they allow locked down businesses to  ‎Lay-off laborers
while applying a governmental social security network where every laid off labor had applied to unemployment benefits and currently receiving support nearly equal to their previous salaries
in addition the government sent checks to families according to their last tax return, families with tax return lower than 75000 $ shall receive 2400 $
families above 150000 $ shall not receive support check, and  a certain amount shall be received for families with tax return range between 75000 and 150000 $
these countries were able to apply fiscal stimulus because they can easily borrow with a lower cost and it’s a good technique to improve their economy
while they later can reduce the public debt from the future tax revenues when economy growth returns
the expectations in industrial countries that as long as corona virus exists there will be a recession
but when economies return to their normal states there will be a long growth period
which will result low economic damages throughout the year such as 2-3% on 2020 and experience a growth year in 2021.
Regarding Jordan, the World Bank expected a recession during the whole year of 2020 with a rate of 3.5%
and I believe these expectations are dependent on the business return date and the most important point is the reactivation of the airport.
The situation in Jordan is hard but it’s not hopeless, some sectors have benefited, some didn’t, and some have suffered
One of Jordan’s features, in a negative way, that the government doesn’t support private sector
and the government prevented laying off laborers and that their salaries must be paid, but at the same time, the government won’t support them in paying salaries
even if their sector is completely locked down; this policy is not smart
the government should contribute in paying that cost or allow laying off while applying support for laid off laborers until the businesses are back to their normal states
Jordan shall consider the economic stimulus because we don’t have the privilege of
unlimited borrowing like Japan, Britain, and USA; we also shall pay attention for some points
Jordan’s external debt service is 13 billion Dinar, 50% of it are bilateral debts with friendly countries
the Word Bank, Monetary Fund, or Arabic development funds, and 50% of it are bonds for commercial debts.
I know that the Jordanian official media addresses the importance of paying the external debt service and that it’s one of Jordan priorities
but the Jordanian diplomatic shall be working with friendly countries and the overall external debt to obtain a grace period until the end of 2021
this grace period will save more than 2 billion Dinars for the Jordanian treasury
and I believe this saved amount shall be utilized into economic stimulus or to a social security network to support the affected businesses’ labor
in addition to vital projects to increase economic effectiveness and creating jobs opportunities
vital projects like public transportation such as railway between Aqaba port and Amman or rapid transport between Amman and Zarqa, or Marka Airport
or any other investment in project that will create job opportunities, stimulates local economy, and the economy effectiveness after the crisis
and the finance shall be saved from external debt service and the civil retirement invoice which include a lot of waste in order to leave this period safely.
Allow me to speak about that last point
I believe we are the only country which shut down its financial market, the first decision for Jordan in the last week is shutting down Amman’s financial market
and financial market plays bank’s role where it transfers money into your economy, Amman’s financial market receives Jordanians’ and Foreigners’ investments
and savings and injects them in economy as investment in the structure of companies’ capitals; I don’t see any benefit from shutting down the financial market
it only delivers a message that Jordanian economy will be negatively affected in all stages for all companies and it implies that all companies’ shares will go down!
While in reality it’s possible that many medicines and medical supplies producing companies have benefited from the current situation
and the most important that shutting down the financial market delivers a negative message for foreign investors with concern that they might not be able to access their money through selling or buying
one more point, that Amman financial market is suffering in last 10 years from lack of liquidity and attention
the tourism sector has been significantly affected and most of hotels and tourism companies in Amman financial market won’t be able to distribute the profits
including 2019 profits, and mostly their share will goes down, but we should keep in mind that low share value isn’t the end in contrary to that
this may stimulates new investments from the gulf countries and from abroad hoping that in 2021, 2022, and 2023 the tourism sector will return to normal states
as main tourism attractions like Petra, the black sea, Baptism Site, and the beautiful summer of Amman still exist
the look to shares is always on medium- and long-term aiming the next 30 years or so; you can’t shut down Amman finical market
without announcing the date of re-opening it! It’s a very bad sign for any local and foreign investor
it will only benefit the small scale speculators who may have 10 thousand dinar and will get a loan for 20 thousand from banks and exchange
for speculative stocks ad if the shares went very low, he will lose all his capital, it doesn’t make sense to shut down Amman financial market for the sake of few speculators
in other words, gamblers who have a liquidity of 1-1.5 million Dinar; Amman financial market if has been operated properly
it would be one of the most important investment attraction sources and would greatly help stimulating the economy
finally, I apologize for having taken up so much in this topic.
Thank you Jawad, we will address Amman financial market and tourism sector in more details in other questions
Proceeding in the same topic, it’s well known that the gulf market is one of the largest operators for Jordanian labor and for Jordanian companies
in your opinion, what steps shall be taken by the private sector or the government regarding this topic?
The gulf markets operates a lot of Jordanian labor, in the top are the markets of Saudi Arabia, United Arab Emirates, and Kuwait
United Arab Emirates and Kuwait have large financial surpluses and I believe they will be able to smoothly get over this crisis and the same applies for Saudi Arabia
with a condition that they re-operate economy in high levels and to restore oil rates above 35-40 USD for most of them
the situation is bad for everyone, but we should remember that the solvency of the gulf countries are high, especially with high external investments
so, they will be able to get over this crisis
most of the Jordanian labor working outdoors are well educated and professional individuals and they will be able to safely pass these hard times
I’d like to mention a specific example in Dubai, the World Trade Center was locked down and used as a large field hospital in order to increase the medical capacity
to be able to cope the increase of patients, I believe that they are preparing to re-operate again
once the medical sector is completely ready to face any consequences resulting from the re-opening process
as we mentioned before that no one is expecting a perfect year in 2020, but after covid-19 everyone is expecting a growth year in 2021
for the majority of global economies which include gulf countries and that’s a good news for Jordanian economy
Thank you Jawad, moving to Wagdi, first of all, thank you for being with us.
The world countries are classifies based on many standards like developing countries, emerging economies
and advanced countries; many studies shows all economies operating on equal opportunities common ground
the used expression for that is “level economy playing field ”, do you believe this is a realistic and practical description?
Do you think that the Jordanian economy will represent self-reliance model which help local industries
and focuses on competitive industries, which didn’t has enough attention before, agriculture, logistics, and electronic services?
Please tell us your opinion about these points.
First, I’d like to thank you Mohamed and to thank the participating speakers
it’s a good opportunity to contact with persons concerned with the global economic situation and the Jordanian economic situation
I don’t believe the “leveling playing ground” is a realistic in light of the competition issues between companies and global industries
and the global system is not open or free for all companies or countries; the commercial war between USA and China has many issues
I believe this quotation is correct, you can get the goods in fair prices
Regarding Jordan, I believe Jordan has a successful experience dealing with the virus and they started a gradual re-opening
for different sectors and I expect it will reach 60-70% within one month
it worth to mention that some competitive sectors appeared in Jordan during the crisis, some pioneer youth who met the expectations in digital services learning Apps, etc
I also expect focus on agriculture and logistics sectors, and also there will be focus on internal tourism and hotels
may apply offers as this sector  suffered a lot during the crisis; at a later stage, the Jordan experience may represent an opportunity for some sectors
and a good environment for investment; I agree Jawad that the shutdown of Amman financial market
wasn’t a positive act as many potential investment in different sectors like hotels, medicines sectors
and medical supplies, could be injected in Amman financial market; discussions are running and I believe Amman financial
market will be re-opened in the first of May as many demands arise from brokers and investors requesting re-opening it for
at least one hour of trading with up and down limits in order to achieve a gradual re-opening without any issues for the country or the central bank.
I’d like to tell Jawad about the profits distributing, also cancelling profits distribution for banking sector
wasn’t a good measure because it delivers a global negative indication about the country performance regarding debts and profits distribution
specially that we have a large reserves resulting from foreign investors with 50% percentage which may be used to cover any profit distribution
so if profits are distributed, 200-250 million Dinar will be transferred outside Jordan.
We have a good opportunity, but after the crisis, the economy will suffer until conducting an agreement
with the International Monetary Fund or agreement with the neighboring Arab countries in order to face the crisis
Arab countries shouldn’t act as a separate islands and there must be a cooperation between each other
Jordan has a good opportunity through self-sufficiency, focusing on competing industries
which produce revenues for the government and for the competing sectors, accordingly
I believe Jordan has a good opportunity after the end of Covid-19 crisis and with the governmental measures.
I’d like to spot the light on the investment mechanism, with the high potential investments in Jordan after the crisis
I think the Jordanian governmental should completely change the investment mechanism in order to support regional
and foreign investors through applying a competitive benefits and incentives; the government shall start working on changing investment mechanisms from now.
Thank you Wagdi, and I agree with your point of view
Jawad, despite the equality of economic opportunities in the capitalist system, do you think the capitalist system is currently dominant?
Do you think other business models may arise in future? Do you think gig economy will have a greater opportunity?
First, we should notice that the capitalist system is the current prevailing system, and even China
which is ruled under a communist party, has a capitalist system with banks, companies’ owners, billionaires, employers
millionaires, and applied taxes; the second point that the capitalist system is a spectrum system, Sweden is currently has a capitalist system
also Britain, during Oliver Twist times, has a capitalist system, and the modern USA and Britain have a capitalist systems but with major differences.
The capitalist system exists since the money was invented and it will keep existing
but it will change according to the community changes, an example of that during the current crisis is the difference between Europe and USA
which both represents a capitalist system, Europeans decided to support the locked down sectors like cinemas and restaurants
by giving 80% of their employees’ salaries to their companies while maintaining their jobs until the crisis ends, while USA instructed the locked down sectors
to lay off their employees and the government will send a check to the employee address and will receive a stalled business allowance
which almost equal to his previous salary, what are the differences between the two systems? Europe maintained the employee’s jobs
while USA protected their employees during the crisis and then they will have to find new job after the crisis; USA believes
that some sectors like cinemas and restaurants are locked down but at the same time sectors like e-commerce
Walmart, Amazon, and IT companies operations expanded, so I motivated the unemployed person to find a job in the expanded sectors
in opposite, the European system will be by your side until business back to normal; which system is correct?
We don’t have an answer for that question, it’s the voter’s decision to identify which system is better
voter choose their government and the government takes its decisions based on that; in 1950s, 1960s, and 1970s when Sweden was communist as it was getting benefits
from the economics improvement, the growth, and the high sales in Europe after World War II, but now Sweden is now a center-right
it reduced taxes, cancelled the inheritance tax; the capitalist system will remain with all its ramifications
India and Latin America have also capitalist systems, but with different protection networks and with different shareholders
employees’, and labor’ rights; now they payed attention that gig economy requires a protection network
an example of that is a freelancer graphic designer whose work stopped but he can’t apply for unemployment benefits
or social security, etc
they may allow these cases to get benefits from the protection social networks; we have a similar example in Jordan
where joining security system is optional for freelancers. Capitalist system will remain until Karl Marx’s prophecy become true.
Thank you Jawad
Tarik, thank you for being with us
Jordan had an economical challenges before the corona virus such as water crisis, transpiration, energy shortage
and its indebtedness, do you think these issues will remain as country’s top priorities?
Let’s take gig economy as an example and if companies changed their business models and operated virtually and digitally, etc.
maybe transportation won’t be on the country’s top priorities, while water and food security will remain on the top priorities
and that will requires stronger plans to enhance the local production, how this could be reflected on energy priorities in Jordan?
Do you think the new business models will create opportunities or challenges?
Praise to god, I’d like to thank you for hosting and I’m glad to be with my fellow friends and my dear doctor.
Before going deep in details, I’d like to speak about the economic state diagnosis before answering questions related to services or economic growth requirements.
We must agree that corona virus has an influence on the whole world, we are part of it, and we are also affected
we, of course, have some issues, but the corona and the changes resulting from it in human’s behavior and investor or consumer way of thinking
make us think of economy principals, I’ll speak about economic 101; the principles upon which the economic was founded in the last thirty or forty years
such as globalization, free trade, labor mobility, and the resulting economic blocs and other economic phenomena which didn’t exist in other stages of the economy history
these principles must have been changed or currently being changed; let’s address Brexit or Trump’s slogan “America first”
the populism,  inward-looking, closing international borders, employment trend, goods trend, etc
and other which we experience their results In one way or another; we must consider that we will enter a Protectionism state where every country will try to protect itself from the outside danger
such as the procedures taken by many countries which included closing borders, airports, ports, etc. to block labor
and tourists movement in order to prevent the spread of this virus in their countries, the corona mandated the close-out protection principle or protection from outside principle against labor and goods
and the corona also mandated other principles which included applying technologies
Corona pandemic has a humanitarian and social influence and it changes the individual’s way of thinking wherever they are located
in Jordan, China, or USA, they are all humans with the same way of thinking, their way of thinking may be governed by their different cultures
but the final result that the human feelings or behaviors, in one way or another, are similar, accordingly
I could relate the populism and protectionism economic behavior, in one way or another, with corona and I could expect that a massive changes are coming.
Getting into the important point, the economic discussion, I tried to add a social and political dimensions to our discussion
before going deep in details and just to be clear, I’m not pessimistic and I believe it’s a great opportunity for Jordan and for the world economy if it was treated and utilized properly.
Jordan population is 10 million people and approximately another 2 million people holding other nationalities
I consider Jordan a good and reasonable market, we can’t compare our market to Egyptian market or the gulf’s market
as an examples, but we have a good active consumer market; when we study a market with 10-12 million people who need to eat
drink, transport, work, etc
we must consider the economic fundamentals and economic 101 which we’ve learned from the textbooks and studied in universities and schools
we must return to the fundamental factors of production which are agriculture and industry and I don’t underestimate other sectors like services, technology, and etc
but I believe that  in order to have properly operating economy, you need to provide peoples’ basic requirements of living like food, drink, electricity, water, and transportation
I think this is an opportunity, the agricultural investment in Jordan is very expensive, we need to encourage planting unused lands
villagers residing outside the capital and who own a pieces of land may reconsider and start thinking of planting it in order to harvest some crop
which will reduce our dependency on imported crop; in future we will need had currencies to pay our debts
my fellows have mentioned that we are borrowing and that’s the only solution for Jordan in these times and if the debt was in Jordanian Dinar
it will comes with crowding effects where the government will compete the private sector on the debt while external borrowing might come with a reasonable interest rate
or goes down with liquidity surplus and cost reduction.
I think that we need to focus on industry and agriculture as a foundations which could be used to re-build the economy and to be able to get over this pandemic
China got over the pandemic, some countries expect 2 or 3 months to get over it
but I think it may take a longer time in our countries, the problem is that our connection to the world may take longer time and that’s why we need to return to the basics.
Regarding the infrastructure, I believe that we have a suitable infrastructure in Jordan, I can’t say it’s a perfect infrastructure
but it’s good when compared to many neighboring countries, we also have a great youthful potentials
but with all respect for everyone the government has a consistent complain that we have a surplus energy and renewable energy, etc.
in fact, the surplus energy is an opportunity not an issue, I’ll take simpler example to explain, if we have surplus production of cucumber
why not to turn it to pickles! Same for the energy, if I have a surplus energy, I could use it to produce water
which could be used in agriculture or in higher levels for a social well-being; food security is essential, surplus energy plus water production plus agriculture equal food security
which mean less importing which will lead to foreign currency out cash flow.  The final result that we need to
re-arrange our economy in a model in order to have the required mechanism for our current situation
I think this is an overall view of the economic matter, we might not be able to elaborate about each section due to limited time.
Thank you Tarik for sharing your holistic input, I agree with you in many points
regarding the peoples’ basic needs and retuning back to basic sectors like agriculture and industry, it’s an important point
and no doubt that we need it in order to achieve self-sufficiency, but we can’t set aside other enabling sectors such as IT sector and many others. Thank you Tarik.
Back to Dr. Mahmoud Sarhan, before the pandemic, many countries have moved toward developing economic plans based on well-being
which the health sector comprises a big part of it believing that securing basic needs like education and health promotes innovation of economy and businesses prosperity
what is Jordan’s opportunity in adopting this principle? With its effect on public interest, do we need to reconsider the spending on the health sector?
Do you think we should focus on research and development, investment in supportive sectors and investment in institutional development?
Jordan is well-known by its famous individuals and not by its institutions titles, main or supportive, in the health sector, please share your opinion regarding these points.
Thank you Mohamed, I’ll start from the last point, it’s a fact that the Jordanian health sector has individual excellence like doctors
nurses, and pharmacists, we have two issues; the first one related to the Jordanian health system in general…can you hear me clearly?
Yes doctor, it’s perfect
Ok, there are two aspects; the first that the Jordanian health system is generally weak especially with primary health services
an example of that when a patient has some headache, which may be because of simple reasons
he would go directly to a brain surgeon; the Jordanian health system is generally weak as it has a self-referral where people refer themselves to specialist believing
they will provide a better health service; we have eight thousands general doctor in Jordan, and 500-600 family doctors, these doctors are not activated in public or private sector
which result that people visit specialties, the number of examinations increase, the cost becomes expensive
if a patient has a minor issue, the doctor may ask him for additional examinations
we have a major issue in the Jordanian health system, the patient have to move from one system to another
inside the country, and we should utilize the corona crisis to improve the health service especially the primary services
the measures to face the corona virus in Jordan and which were performed by the ministry of health with the aid of army, public security department, IT, and other sectors improved our country
image and made me feel glad; when we have a hard matter or an issue we act better compared to our performance in normal state.
The second point is our institutions, I call them extractive institutions not inclusive institution, and most of the institutions hire low efficiency employees, have insufficient number of employees
and the government policies don’t force the institutions to be inclusive which lead to an average situation in Jordan
we are an average level country with average economy level and average health sector, etc. and we will remain average until we establish inclusive institutions
which hire employees based on merit and which have R&D departments; we have all the required elements for the Jordanian health sector exist
we just need to follow a system and to have inclusive institutions and that would result a significant advancement in health sector
I’m really sad to see Jordanian health sector in that state, it has all the elements and we just need to put them together
that was a brief about the health sector in Jordan which include the primary health services and the institutions.
Thank you doctor for your input
Wagdi, what’s your opinion about the consumer behavior and the supply chain?
What’s the influence on the supply chain? And how it will affect the companies’ business models? And how we could have business models?
Of course, the consumer behavior will change, you may have noticed the current focus on health topic, social distance, using digital services for delivery purposes; if we spoke about Jordan as a special case
I expect that even our Jordanian mores and values will change like groupings and wedding parties
the conclusion that the consumer behavior from both aspects, morals and the citizen dealing way with daily activities; social distance, maintaining health, food security
and contacting digital delivery service companies; now, we have more focus on digital delivery service which may create good investment opportunities at a later stage.
Regarding the supply chain, Jordan is suffering and all countries performed shutdowns, stopped exporting, stopped airlines, applied social distancing
and obtaining raw materials might be hard and that’s why Jordan is focusing on achieving strategic stockpile and obtaining raw materials for national industries
to be able to deal with the virus at later stage; based on that, there will be an affect on consumer behavior at all levels
Regarding the supply chain, we need to have a strategy to provide raw materials and other essential needs in Jordan
and that also apply on all the world countries to reach the point where we can properly deal with that virus.
As I mentioned before, measures such as social distancing may cause issues for some sectors which require groupings
that’s why social distancing shall be a people’s culture, and I expect after the virus that social distancing and health treatment will turn to be a culture
in the coming four or five months to avoid spreading the virus again; these were my opinion regarding consumer behavior and supply chain and the required strategy to handle these problems
If you have any more questions, I’ll be glad to answer them.
Thank you, Wagdi. I agree with you, we as a conferences and exhibitions sector is consider as a supportive sector to the tourism sector
and we were greatly affected by social distancing measures; lately it’s more likely to be called physical distancing instead of social distancing
an example of that is our meeting where we have approximately 100 speakers which are close socially but physically away from each other hoping to have a near solution.
I’d like or remind our audience that tomorrow session will address in more depth the economic sectors and in order to have answers regarding the supply chain issue
we will have the operation manager in Aramex company, Mr. Iyad Kamal, and we will be waiting for today’s audience to be with us tomorrow.
Back to Jawad, the corona virus caused an economic and health issues and you answered this part, but I’d like to confirm your answer
after the health crisis end, we will face an economic crisis and facts will be clear; what’s the required fiscal stimulus and what are the tools to achieve it?
And you may in brief mention lessons learned from other countries experiences.
I reviewed the labor market structure in Jordan, there are 600,000 public sector employees, approximate 690,000 private sector employees participating in the social security program
the employment size is 2.5 million, so, before we had 20% unemployed and 31% in informal sector which aren’t part of the public sector and not participating in social security program
and they include the migrant worker; my estimation that we have one million unemployed labor, including the unemployed percentage before the crisis
who need the minimum required cash in order to fulfill live basic needs like bread, sugar, cooking oil, rice, tea, milk, etc
it was a good act from the government to inject more money to the National Assistance Fund, but I don’t agree to instruct the affected and debt-distressed sectors to pay their employees salaries
that needs a proper treatment; in the tourism sector as an example, some hotels took loans to perform preparation for the season of 2020 since they had a perfect season in 2019
when 2020 end, we won’t receive 4 or 5 billion USD compared to 2019, instead we will receive 10% of that amount
it doesn’t make sense to instruct that hotel to pay salaries even if it had to obtain more loans! This will result a “zombie” organization
what the benefit a restaurant will get when tourism is back after it had to borrow 200,000 Dinar to pay the salaries for 6, 7, o 10 months in advance without any income!
These instructions just added stress on businesses with additional loans; this burden should be carried by the government and social security program
if the labor were participating in it, according to laws as the social security program obtains 60 million Dinar yearly from the participants
1.5% unemployed allowance from each participant, and the law allows receiving support for 3-6 months of unemployment period
It’s not wrong that the government to borrow in order to cover the social security networks and to provide cash to the unemployed 1 million labor until the end of the crisis.
It’s essential to have fiscal stimulus for the economy, it’s not right to be concerned about keeping the deficit within he expected values, mostly the deficit will increase
the government shouldn’t focus on stabilizing its debt, Jordan is not Germany, Japan, USA, or Britain, we don’t have hard currencies like Euro Yen, and Dollars
if you could obtain exemptions, extensions, or concessional terms for your current loans, then you should invest all your savings in Jordan
fiscal stimulus could be applied by breaking the monopoly inside Jordan, this is a good opportunity to break the economic monopolies in Jordan
Jordan has monopolies in some very important sectors like transportation, energy, oil products, medical, and professional associations
in order to stimulate your economy in order to grow after this pandemic you will need to apply fiscal stimulus and
to have an agreed national strategy with no more monopolies where all economic sectors are competitive even for energy distribution
I’ll mention a historical example, long time ago there was a principle that water, electricity, and telecommunication are natural monopolies
but the technical advancement allows to have a competitive telecommunication sector, any economist in 1950s would definitely describe telecommunication as natural monopoly
but now any economist would definitely describe it as a sector that is competitive, private, unsupported, paying taxes, and subjected to laws, and the same applies for energy distribution sector
and with the advancement in solar energy, battery technology, smart grids, and internet of things you might close the three existing distribution companies in Jordan
Jordan and start considering new competitors in energy distribution sector same as many other countries did
moving to the transportation sector, now it’s the era of Uber, Careem, smart phones, IOT, and self-driving vehicle
and we still use the legacy transportation passes which passed through generations and which was distributed on specific carriers long time ago.
We need to break the monopolies and fiscal stimulus the economy, hopefully we will get over that crisis stronger then we used to be
but if we didn’t perform any changes and kept using the old systems the results will be worse
the current situation is a good opportunity which must be utilized.
Thank you Jawad. Back to Tarik, we saw solidarity between the public and the private sectors
do you think we could improve this concept in light of social enterprise on sectorial and companies levels?
Mohamed, let’s return again to economy fundamentals; it’s always important to start from the fundamental in order to determine your current location and what route we should take.
My friend Jawad spoke few minutes ago about Defense Order No. 6 which instructed to maintain the labor despite the company’s state
sometimes we forgot what ground we are standing on and what economy fundamental we are actually using
everyone is aware of the exceptional hard situation we are experiencing, but in opposite side, we claim that we have a free, capitalist, and non-socialists economy
in that case, the government decision is considered arbitrary; when we consider a real partnership between the pubic and the private sectors then each party should clearly know his rights and obligations
you can’t act against your plans and strategies, and I’d like to highlight ,again, that we all are aware of the exceptional situation which we hope to end as soon as possible
if the crisis continued, all points must be clear as we can’t live in blurry.
Partnership is essential for any economy, and all parties shall accept the other parties as partners; my background comes from the private sector
and that’s why I’m always concerned about the government forgetting this important point and dealing with the private sector in a different way.
Partnership should return to fundamentals, we need to return to home economics where every individual capable of producing any product in his home shall start
such as planting and crafts, I saw an image for some people producing medical masks in a small workshop or others who produced alcohol
all those individuals participated in solving the current issue instead of importing all these needs; we need to return to the fundamentals where we plant our food and manufacture our clothes.
Anyway, macroeconomic planning is the country role, private sector can’t put the country’s strategy, but it may has some suggestions
which might be accepted or not and unfortunately the suggestions related to important points
for the private sector are usually ignored; the partnership between the public and private sector is huge and it’s certified with documents
contracts, legal frameworks, and structures, but it’s disavowed by the government, maybe disavowing is not the right word to say
but we may say that the government is not performing its role transparently regarding this partnership
I believe this is the current dilemma; we always demand the unit and partnership between public and private sectors including all private sector inputs and vocabularies such as home sector
industrial sector, agriculture sector, or services sector, and the government should be clear and allow engagement with the private sector
nowadays, I feel the government don’t want to listen to or discuss
with the private sector; criticizing the government is not my aim, the current point is a convergence and homogenous point where every party will know his rights and obligations.
Regarding the Social Enterprise concept, we always speak about cooperative economy, but I’m a capitalist not a socialist
401
01:15:47,943 --> 01:15:33,600
and I believe that socialism has some positive sides, and I also believe that we need to re-program the existing economic system in order to know its pros and cons
this is a suitable time to re-evaluate these matters properly.
The sustainable economic development can’t be achieved by one party, it could be achieved through the cooperation between all parties in one direction
and I hope that the government invites the different economic sectors to sit together trying to determine the right routes
I’m against the lack of clarity, and we must define the natural of our economy
free economy or market economy is different compare to partnership economy where the private sector is forced into certain measures.
Thank you Tarik. I’d like to confirm that economy building is a participative process in all its forms.
Back to Dr. Mahmoud, our lifestyle and way of work changed, and now we have something called physical distancing or social distancing
this might not be the last time to see the virus and it my arises again in future; with our changed behavior
do you think we might face in future a worse pandemic than the current one with a worse affection? In other words, what’s worse than that?
We are staying at home and working from homes, what would be worse than this?
Thank you, it’s imperative that other pandemic, similar or worse, will arise in future, and we need to put plans for that
and many theorists spoke about corona virus like two years ago, Bill Gates also spoke about that few months ago
and many other medical scientists spoke about a new viral pandemic, and how we should prepare to it with a strong immune, and the 7 billion people don’t have the required immune system
the right strategy that should be taken by the governments is preparing for another future pandemic through benefiting from the current experience
for Jordan, we should right down the current events and put positive and negative feedbacks on them, and then put a future plan to face any possible pandemic
I don’t believe that we have in Jordan a plan named “Pandemic Response Plan”, we might have wars management plans as we have a strong army
but I don’t think we have a Natural disasters plans; our rank for health care safety and security is like usual 70-80% which shows the country ability to face a medical pandemic
our score is like 70-74%; we need to learn from the our current experience what’s its positive to be used in future and then prepare for future pandemic
thanks to god that our case was better than Italy, our public and private medical sectors don’t have the capacity for rates similar to Italy
it was good decision to lock down and perform shut downs with the diagnosis of the first case, if we waited like Italy and USA did, we might had a worse situation.
The future pandemics are inevitable and we must be prepared for such natural disasters, and that assuming the current pandemic is natural pandemic not a human work
as 5-10% of people still believe that it could be some biological weapon or something like that. Thank you
Thank you doctor. We will address the conspiracy theory later
Back to Wagdi. Regarding foreign direct investment in the later stage, the foreign direct investment has different forms such as infrastructure project and onshore companies, etc
what are Jordan possibilities to smartly re-structure the economy? How could we recast the economy in order to attract foreign investments?
Mohamed, the foreign direct investment diminished considerably in the last two years, with approximate diminishing value of 650 million Dinar
and that’s due to many factors which included investors transferring some investments to other countries in a better competitive environment
and that’s why I talked about the investment mechanism; investment mechanism must be clearly changed in order to attract investments to Jordan
investment which may be very beneficial for Jordan during the crisis or after it; foreign investment in Jordan is a complex topic and it suffered from many issues
and it worth to mention that the government used to change laws related to investment like taxes laws and that represents a major issue for any investor, local or foreigner
any investor would rather invest in a country that has a clear investment and tax laws without any surprising change in them
and litigation process takes long time in Jordan which also represents one of the investors issues here in Jordan
so, foreign investment is very important in infrastructure projects, and we need to focus on transportation sector, especially on railways projects between provinces
also logistics industries sector need to be focused on, Information Technology, digital services, and agriculture
sadly, Jordan, for decades, was one of the main beneficiaries of agriculture sector, it may improve if we developed the agricultural structure, also we need to focus on energy sector.
If we spoke in detail about investment in infra structure projects, we might consider investment through public joint stock companies
50-51% of the volume of investment are foreigners which indicates confidence in Jordan
and this confidence may be increased through attracting investment to more beneficial sectors and projects with a better potential return compared to other sectors
It worth to mention that the Jordanian experience is successful; we, the government, and the private sector shall utilize this success
The partnership between public and private sectors is very important after this crisis; sadly this partnership didn’t meet our expectations in earlier times
the trend is toward partnership and I think it should be activated in a better way; Jordan needs a better marketing
we need to market projects, companies, and attract a better investments. People may learn lessons from the Jordanian experience, especially in the medical sector
during the current crisis while fighting the virus, it’s a success story which could be used by Jordan in attracting and activating investments in a better way.
Thank you Wagdi. Jawad, commenting on Wagdi speech, do you see the foreign investment as a near solution in the existence of corona virus?
Foreign investment was always important for Jordan, 90% of telecommunication companies are foreign investment and not all of them achieved profits as we all know
Express started the operations in Jordan and then lost also Wi Tribe had lost by millions,
and any investment which exceeds 3-4 billion Dinar is a foreign investment, also 55% of investment in banks are foreigners, major part of hotels and factories investment are foreign investment
and major part of the manufactures of exported clothes to USA are foreign investments.
The Jordanian Banks Association performed a study about the corona virus influence on the Jordanian economy, the study has many aspects, and starting with the exports
the study addresses that the exports will decrease with low rates because our major exports are still operating such as mining, phosphate, and potassium
the exports decrease will result a great decrease in imports and accordingly trade deficit will decrease
regarding the tourism, we will lost a huge expected revenues from tourism 2020, but major part of that lost will be compensate from the energy invoices because of the international fall of the oil prices
the fall of oil prices shall allow the government to lower the energy costs on factories, with lower energy costs, factories will start production and importing
especially that we have good imports from these factories, also the demand on energy might increase which will solve the surplus energy problem
mostly the economy will contract with higher unemployment rates, but we hope that 2021 will allow us to rise
through utilizing this opportunity to stimulate the economy by fiscal stimulus and with good investment which will increase the efficiency of the economy
and at the same time break the monopoly which has a bad effect on the country in order to turn Jordan to a modern country
and the Jordanian people have proved thought the history their ability to face challenges, but we need to learn from our mistakes and not to repeat them again.
Thank you Jawad for that positive review which will add some positive points to this session and light a route of hope for the people about the economy in the later stage.
Thanks for all our speaker, we shall start answering some of the received questions, we never feel bored from your speeches
we talked for 90 minutes and we will ask you to continue for few additional minutes in order to answer some questions.
Tarik, I believe you’d like to add something before we finish.
I just would like to add some points regarding the topic Jawad addressed, in economic literature
the process of restarting the economy operation is not a hard process, it might takes some time
but it comes with many benefits especially if it comes combined with economic policies; if the government was able to take some procedures and decisions which will change the economic frame
and some investors engagement requirements, etc. and re-organizing the fiscal policy
we all witnessed the central bank, as the sponsor of the fiscal policy, taking some important decisions
but we didn’t see any current actions regarding the fiscal policy, maybe they are waiting to see how far the crisis consequences will go
this is a suitable time, we named the session “rebooting”, rebooting in computers means that we modified the software or added hardware, and reboot perform a positive process when it’s properly planned and studied
and what I’m saying doesn’t imply delaying the economy restart operation, in contrary to that, I hope the economy restart take place as soon as possible
but the main question remains, how we should benefit from the current situation in re-organizing the economy, sectors, and sectors’ priorities as soon as possible.
Thank you Tarik. Thanks for our speakers and audience, we will move to question, if you have any question, please send it
as we mentioned before, on the chat to the user named “Questions”
and I’d like to remind you that today’s audience may join us tomorrow and after tomorrow; tomorrow session moderator will be Dr. Amin
and the speakers, Iyad Kamal from Aramex, Tarik Yaghmour from The Group, Hosny Khofash from Mawdo’ company, and the laywer Mr. Youssef El-khalilia.
Allow me to review the questions. We will start with Tarik since the topic is relevant to energy
Sister Ruba El-Zoabi “on individual level, would tendency to install renewable energy systems go up? Would financing still be available to facilitate this?”
First, I’d like to welcome Ruba, she’s a professional friend with long experience in renewable energy field
her question is very important and I’d answer as follows, hence that we’re talking about large scale projects Such as Round 3 project
any project may be financed as long as the documents and certifications meet the required level in order to be bankable
and we must pay attention for a very important matter, the last 10-15 years indicated that Jordan is internationally accepted and desired by the investors and financiers
but there is a consistent issue relevant to the change in the governmental policies, the renewable energy projects will last because it have many benefits
Regarding the other part of the question related to the small scale, distributed system, and wheeling, etc
we should keep in mind that the current situation is an exceptional situation in every sense
We had a phone call with the minister of energy and the leaders of the international electricity company, the electricity system is stressed and the performance is going down
I believe when the economy returns there will be a great opportunities
especially if the government considered raising the electricity prices which will open the way for the renewable energy sector to continue. Thank you.
Thank you Tarik. This question for Jawad, we already answered it, Fadi Margi asks
what shall be performed by the Jordanian government in order to stimulate the economy? Are the central bank’s and social security’s instruction and procedures are sufficient?
The central bank performed a monetary policy which may be considered sufficient it improved the monetary policy and increased the banks’ lending capacity
the government should perform monetary policy, fiscal stimulus; we offered three suggestions, the first is to borrow 450 million Dinars
from the liberated compulsory reserves and to inject them to 1 million unemployed labor who need cash payments in a monthly rate of 100-150 million
for a period of 3-4 months this will guarantee that those unemployed have the lower limits needed to live and these cash amount will return to the economy cycle again in the form of their expenditures
which most of them are local products like food; then the government must succeed to lower the external debt burden
which is 13 billion Dinars or 20 billion USD, and the yearly cost of the this external debt service exceed one billion Dinar
if we could obtain 1-1.5 year grace period, then these money will be injected in the economy in the form of a specific projects
like Railway Akkaba-Amman-Zarqa because it doesn’t make sense to have this project on the development plans since 1970s
and since that time we are exporting the raw material through the desert road! And all the Jordanian goods have to pass through the desert road!
Even though 80% of our exports come through Akkaba and 90% of our consumption located in Amman, Zarqa, and Irbid
and the route is straight and the railway way exist since the Hegaz Railway! This is an important investment for the economy effectiveness
to support the economy, to create job opportunities, and increase demand on cement, iron, etc
This is a vital investment which should be performed as soon as possible; other projects like earthen dams in the south for livestock
also Amman-Zarqa rote needs a public transportation means as 300,000-400,000 daily passengers take that route, and they can’t keep using the coaster buses and ruin the autostrada
also some tourism projects like cable car from Mount Nebo to the Dead Sea, all the mentioned projects are potential investments which will increase the economy effectiveness
the central bank performed monetary policy social security enforced the law
and it even performed less than the amount instructed by the law this might affect the confidence in social security system in future
each participant in the social security system pays 1.5% of his salary as an unemployment allowance and the employee can’t find the support when needed!
That will affect the social security system credibility; anyway the central bank and the social security took some steps
but remains that the country should perform some fiscal stimulus and waiting for the Jordanian diplomacy success to obtain a grace period for the external debt
because we don’t have room for maneuver, which is available for big industrial countries, in order to achieve fiscal stimulus and large Jordanian governmental investments
but if that success and the government performed the right fiscal stimulus this will result in strong foundations for later stages after corona virus, and also if combined with breaking the monopolies
we will return stronger then we were before the crisis, and keep in mind that the Jordanian economy in 2018 and 2019 wasn’t good
while in the prosperity days we had 70,000 new job opportunities yearly and it decreased to 50,000 in the period from 2012 to 2017
it was 20,000 in 2018 and 10,000 in 2019, so, our economy was already suffering without job opportunities
our ambition shouldn’t stop at retuning back to 2018 and 2019, but we should utilize this opportunity in order to create a growing effective realistic competitive  productive economy
and I feel optimistic about it because always the big changes require big moves and we hope that locking down the country for 2 months or more is the big move we were seeking.
They say that changes in status cause shock wave effect in economy. I totally agree with regarding the monopoly
our most successful story was breaking the monopoly in the telecommunication sector and its positive results with the foreign direct investment
and how it was beneficial for the citizen and for the government in the form of income and special services.
A question for Dr. Mahmoud from Emad Treash, when the medical tourism is expected to return in Jordan?
The medical tourism quite significantly returned by the land and air borders, we might need flights to the countries where medical tourists come from, like Iraq, Saudi, Libya, Sudan, Yemen, and Syria
all these countries are currently closed and also airport is closed, and I believe that largely depends on re-opening the airports; for local tourism
everything is ready but we just need the economy cycle to start moving; doctors’ clinics, nurses, and pharmacies opened two weeks ago.
Thank you doctor. Wagdi, Meis Dawood asking, we spoke about self-sufficient in the agriculture sector, what we shall do to achieve self-sufficient?
I’ve worked with Ifad Group which has an agriculture sector development project, especially farmers sector
but we need support, the government should give special priority to the agriculture in the government budgetary
and I think there will be a lot of changes in 2020 budgetary; so we need government priority and support
Ifad is one of the agriculture sector donor toward the agricultural technology; self-sufficient and utilizing the agriculture sector
will play an important role in the later stage through budgetary support and attracting agricultural investment funds in order to support the agricultural sector
we also need to focus on planting crops which consume low rates of water, and using new agriculture mechanism will help also help the sector.
The last question for you Wagdi, regarding the micro businesses, are the stimulating means for micro business are similar to those for small and medium businesses?
The government has established some funds to support the micro, small, and medium businesses, the supply is available but there are no sophisticated projects to benefit from this supply
there are o imitative projects in many sectors to use that support, in contract to that, the government, private sector
and some funds established some funds to support micro businesses, but sadly there are no projects to benefit from this financing, we need new ideas.
Thanks for the speakers and the audience for being with us in the session which is a part of 
“Rebooting the Economy 2020”
tomorrow we will have a session about moving from crisis management to recovery, and in the last day, Thursday, we will have session about the effect on MMUs, startups, and investments
I hope todays’ audience to register for the coming two sessions. We would like to end this session with a positive attitude
and we would like to thank Jawad, Wagdi, Tarik, Dr. Mahmoud Sarhan, and thank you hoping to meet you all tomorrow at the same time 11:00 and thank you all.
