Israel, Jordan begin building free trade zone

Plants slated to compete with China in cheap production are projected to provide 13,000 jobs for Jordanians and Israelis.

By DROR FEUER/GLOBES
January 16, 2017 13:47
Jericho

An IDF guard post is seen near Jericho along the border between Israel and Jordan in the Jordan Valley.. (photo credit: REUTERS/BAZ RATNER)

When the sun emerged last Thursday after several rainy days in the Ta'anakh area in the Beit Shean Valley, the springs sparkled with a bewitching spectrum of shades of green. The air was crisp, with a pleasant odor. We passed east of Kibbutz Tirat Zvi through fields of palm trees and crops along the border fence until we reached the Jordan River and the Bezeq River. Three weeks ago, they began building Shaar Hayarden - a bridge between Israel and Jordan over the Jordan River - the only joint Israel-Jordan infrastructure project since the two countries signed a peace treaty more than 20 years ago. The enclave will become a shared industrial and business enclave with 700 dunam (175 acres) on the Jordanian side, where factories will be built, and 245 dunam (61.25 acres) on the Israel side (expropriated from the kibbutz), where the logistics support, delivery, customs, etc. will be located - including the 352-meter bridge. There is little to see so far. The bulldozers are cutting away part of the hill on Israeli side. The sand is transferred to the Jordanian side on trucks, and is steamrollered into what will be a bridge when the work is finished 18 months from now. Up until recently, the entire area was one big mine field, but the mines have been removed on both sides of the border.

Why is it an enclave? Because the area will be a closed aquarium where Israelis and Jordanians will not need passports to enter; at the same time, it will not be a border crossing between the two countries. The word "shared" is also not very accurate, because Israel is paying for all of it. The budget for building the bridge is NIS 60 million (allocated from the Ministry of Transport through the Ministry of Regional Cooperation), and the total budget for the industrial zone (on the Israeli side) is NIS 200 million.

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The idea of a free trade zone was first raised when the peace agreement was signed, and the two countries signed an agreement in 1998 to establish an industrial park (approved by the government in 1999). 13 years later, in 2012, a ministerial committee headed by the minister for regional cooperation approved the completion of construction on the Shaar Hayarden project. A year later, in December 2013, the government again gave its approval. Now, four years after that, the work will begin.

The advantages for the two sides (mainly on our side) of such a free trade zone are obvious: free flow of workers, businessmen, goods, and raw materials, and all sorts of benefits and regulatory concessions, such as an exemption from corporate taxation, customs duties, purchase taxes, VAT, income tax, building registration fees, land taxes, etc. The location is also ideal – approximately halfway between Haifa Port and Amman, not far from Irbid, the second largest city in Jordan. This facilitates easy access to Europe and the US from the Israeli side, and to the Gulf of Aqaba and the Far East from the Jordanian side.

The two greatest benefits, however, lie elsewhere. The first is that the factories will be able to obtain Jordanian, Israel, and neutral (made in Jordan Gateway) certificates of origin. This will enable the Jordanians to conceal, if only slightly, their cooperation with the Zionist entity, and enable Israeli companies to export to countries previously uninterested in their output. The second great advantage is what is referred to in politically correct language as an "attractive labor force" - in other words, Jordanian labor is cheaper than cheap. The Jordanian worker does not benefit from the labor laws that Israel has (minimum wage and so forth), and is paid something like three dinars (NIS 16) a day. Even if the Israeli enterprise multiples his wages to the huge sum of NIS 1,000 a month, it is very worthwhile for the employer, whether Israeli or foreign. It is also worthwhile for Jordan, by the way - employment there is sky high.

Cheap labor that is close by - that is the story. What has happened to factories in China? The problem is that production in China has to be in large quantities and only of certain things (which also makes Shaar Hayarden ideal for medium-sized businesses), quality is so-so, and Israel has much more of a common language with the Arabs than with the Chinese. What an odd turn things have taken! It was not so long ago, that factories moved to Jordan and from there to China, and now they are returning. The quest for cheap labor will never end.

The number of people projected to work in Shaar Hayarden is 7,500-10,000 Jordanians (in the initial stage - there is an option to double the number later) and 3,000 Israelis. There is a risk of cannibalization – it is not unimaginable that Israeli manufacturers will see how cheap this labor force is, close plants in Israel, and lay off workers, not to mention the fact that the Beit Shean Valley is already not exactly the place with the highest wages or the most jobs in Israel. The Ministry of Regional Cooperation insists that such a scenario will definitely be prevented. Time will tell.

Joint projects

We're standing on the Israel side and observing the factories already on the Jordanian side on the side of the river: car filters, animal feed, disposable plastic cutlery, etc. It is not high tech, or even medium tech. One day, so the vision goes, gas will flow to this place, and a power plant will be built, but a malt beer plant will be built long before that happens (they tell me that Nesher Malt is really interested). "We", by the way, is Ministry of Regional Cooperation director general Hashem Hussein, a really nice and horribly diligent man who rose from the ranks; Ministry of Regional Cooperation economics and research division director Adi Ashkenazi; Dael Levy, CEO of the Valley of Springs Economic Corporation, which is building the bridge; and Yoram Karin, head of the Valley of Springs Regional Council, whose entire eastern boundary is the border with Jordan. Karin comments, "During the War of Attrition, we sat here in bomb shelters. We have seen peace, and now we want a real and significant peace." They are talking about opening a visitors center and making Shaar Hayarden a place for direct meetings between Israelis and Jordanians.

There are guards on our side and on their side, but everything looks very pastoral. As of now, a small bridge hangs over the Jordan River with trucks traveling over it from one side to the other. The base of the bridge is to be in the river itself. "Tell me," I say to them, "with all due respect for this project, when I look at the Jordan River, it's nothing more than a very narrow water channel. Bridge? You can jump over this river. What's the problem?" "Don't belittle the Jordan River," they tell me. "First of all, it's deeper than it looks. Secondly, it constantly rises and falls, floods, and goes back down, which really complicated the removal of the mines. Thirdly, its route is changing all the time. 100 years ago, the great General Allenby got into trouble here," Hussein says. "He also took the Jordan River lightly." Levy adds, "Furthermore, the bridge is being erected exactly at the intersection of the Jordan and Bezeq Rivers (the Bezeq River flows from the southern Gilboa and drains water from northeastern Samaria), an area subject to floods.

Trucks come and go from Israel to Jordan, transporting sand (and mainly mud) from here to there. The serious construction will begin only in March. Everyone talks about "Jordanian sensitivity" - it is necessary to reduce the stay and work there, not to spell out sensitive matters of costs, limit as much as possible coverage of the fact that Israeli factories will be built there, and so on. Even a tour planned for me on the Jordanian side of the business zone was canceled at the last minute without any real reason (there was a terrorist attack several hundred kilometers away).

"Globes": It's hard for me to accept this Jordanian attitude. We are building a bridge, providing jobs in an area of unemployment, making it easy for them to export and import goods. The list goes on and on, and they're making problems. What's going on?

Hussein: "The Jordanians are very distrustful, and they had many doubts. After all, it has been 20 years since the peace agreement, and nothing has happened on our side. One of the things we're working on the most is relations of trust. The Israeli side often makes promises, but things get stuck because of bureaucracy. They don't understand it very well - they don't have things like environmentalists, for example. Whatever the king decides goes. Anything involving water also makes them nervous, and certainly since the war in Syria began. There are already 2.5 million Syrian refugees in Jordan, plus 1.5 million other refugees from Iraq and Egypt. They don't have enough water and any time we get close to Jordan, they jump.

"At the level of the leaders, the army, and the defense agencies, there is peace and good cooperation, but at the level of people - nothing. Israel has not managed to draw the two sides together."

You are right, certainly not in comparison with the never-ending, even moving, attempts by the Arab world to get closer to Israel.

"We're working a lot on interpersonal meeting between students and young people from both sides, and it's working very nicely, I tell you."

Hussein mentions a woman student wearing a hijab who was surprised to discover that Israelis do not have horns, and a young Jordanian researcher whose eyes lit up when he found out there are Arabs in Israel working even in the civil service, and so on - but they eventually go home and tell no one about it. The same is true about a bunch of joint environmental, water, and other projects. I don't know. Maybe is just my Israeli ego, but it makes me a little angry. Who likes being exploited, after which they are ashamed of being involved with us?

In the end, however, Hussein says, the Jordanians, after they saw that Israel was beginning to build, agreed to do something, and found an analogous administration on their side. Senior Ministry of Regional Cooperation officials, all of them nice and extremely professional, like Ashekanzi, talk about the enormous interest by manufacturers in Shaar Hayarden, the ambition to bring here delivery and logistics giants like DHL, Fedex, and UPS ("A German company is very interested," he says, "and the Japanese, too."). They also speak of other projects, mostly quite small, like meetings I have already described, but some are just a bit bigger, except for the Two Seas Canal pipeline from the Mediterranean Sea to the Dead Sea, of course, a project that may or may not come off. There is a tourism project in Qasr el-Yahud (Jews Palace), the third holiest site in Christianity (after the Church of the Nativity in Bethlehem and the Church of the Holy Sepulchre in Jerusalem). This is where Christian tradition says that John the Baptist baptized Jesus and his followers, while Jewish tradition say that this is where the children of Israel crossed the Jordan River and entered the Land of Canaan. There are also other border crossings, and reconstruction of the bridge at Naharayim (this March, it will be 20 years since the murder of seven Israeli girls by a Jordanian soldier).

Knows the work

Even though the people in the Ministry of Regional Cooperation are very professional and nice, however, and even though there is an important need for regional cooperation, it is not at all clear why this ministry is necessary. In a properly-run country, or at least a slight less badly-run one, it would be a department, important and significant, but just a department in the Ministry of Foreign Affairs or the Prime Minister's Office (the Ministry of Regional Cooperation's budget is just NIS 50 million).

This ministry was created in 1999 during the Barak government for the purpose of giving the last former President and Prime Minister Shimon Peres a job. He was followed by Tzipi Livni, after which the ministry then functioned as a kind of clearing house for rather unimpressive politicians with whom nothing else could be done, but who had to be given respect, such as Roni Milo, Raleb Majadele, and Silvan Shalom. After the most recent elections, Prime Minister Benjamin Netanyahu held the position. As deputy minister, Ayoob Kara may not have much authority - he has functioned as a project manager - but they say he has done it wholeheartedly, investing time and effort, and being very involved.

At the end of December, after the prime minister was asked to reduce the number of government portfolios he held, Tzachi Hanegbi - another one who in my opinion is better known for his loyalty that for his parliamentary diligence - was appointed Minister of Regional Cooperation. It is not yet clear what will happen to Kara – whether he will remain deputy minister, or whether a different job will be found for him. On the other hand, who cares? The professionals in the ministry know their jobs.

"All right," I tell the good people from the ministry, "Apropos 'knows the work,' please take me to someone who knows the work here, because with all due respect for cooperation, visitors centers, and jobs for politicians, I like bridges; that's what I came for." "We have just the person for you," they tell me, and take me to meet Vladimir Levitt.

The meeting with Levit unquestionably made my day. Levitt, a bridge engineer, is a cheerful man, with many major infrastructure projects to his credit, including the Anava Interchange and the Jezreel Valley railway track. Unlike the others, who like talking about high-falutin things, Levitt and I immediately get into a deep discussion of designing and building bridges. I like it.

Levitt patiently explains that an incremental launching bridge is involved. These bridges, which are currently found all over Israel, make it possible to build an elevated bridge without disturbing the activity going on under it (two such possible disturbances in our case are the flow of water in the Jordan River and the desire to reduce work in Jordan to a minimum. Such bridges, however, usually involve a road or a very high place, such as the bridges on Highway 1).

How does it work? You build the first element, and connect it to construction called a "steel nose," which looks more like a sleeve functioning as a support, on which sections of concrete and steel are pressed until they reach the other side. The steel nose leads the sliding while resting on the next pillar, thereby reducing the loads on the segment, and so on to the next pillar.

The first incremental launching bridge, Levitt tells me, was constructed in Germany in 1957. "Thanks," I tell him, "That's important to me." Levitt says that the bridge will be 352 meters long and have nine pillars, with 46 meters between each pair of pillars. "If there are nine pillars, how many spans are there," Levitt asks me, with a half-serious, half-humorous expression. "Eight," I tell him," and to my vast relief, he agrees. At its peak, the bridge will be 12 meters high, and the pistons will push 20 meters in eight hours, net. It actually comes to something like 20 meters a week. 1,100 tons of steel that is unavailable in Israel is needed for the construction, with 20 centimeters of concrete on it.

It sounds serious.

Levitt: "Very serious.

I confide in Levitt my astonishment about the contrast between the bridge, a wondrous creation of concrete and steel, and the negligible stream over which it is pass. "Yes," agrees Levitt, "The Jordan River looks very small, narrow, and harmless, but it's deeper than it looks, about 2.5 meters, and in addition, it changes constantly, and that's a large part of our problem. It also meanders a lot (the word comes from the Meander River in Turkey, which has a great many bends), not to mention the fact that the bridge passes over the exact meeting point of the rivers."

Couldn't you find a more convenient place?

Levitt stands up, goes to the map, and shows me that there is no more convenient place. "Another problem is that we're standing right at the Syrian-African Rift. The bridge, which is perpendicular to the rift, has to comply with the earthquake standard," he explains. "What's that?" I ask. "According to calculations, a 7.1 Richter scale earthquake is expected," one of those present quickly answers. Levitt gives him a look that could make a bridge collapse. "The frequency is much more important that the force," he says.

So what are you doing?

"We're digging very deep foundations - 32 meters deep, and each steel pillar has a 1.6-meter diameter."

Levitt explains the dynamics and statics to me – the forces and momentum exerted on the systems and physical bodies (a building, for example, is at rest with respect to the earth, but the earth moves at high speed through space, and a bridge must also deal with both what moves over it and what is beneath it). Dynamics and statics are mechanics. I do not understand much of this, but I am enjoying it so much.

Summing up, Levitt says, "We've done very professional calculations here. Don't worry."

When you are here, Vladimir, I am calm. How long is this bridge supposed to last?

"We're building it for 120 years. That's our contract."

May we live to that age.

"We haven't even mentioned the supports and the expansion joints. These are what work the hardest and bear the heaviest loads. Why are you looking at me like that?"

I didn't attend the lecture about supports and joints. Let me see your figures.

"Supports contain the shocks and the expansion joints. Do you know that when you drive over a bridge and hear the noise it makes when you go over the metal bars? That's it."

And when do you start the serious work?

"The real action starts around March."

I'll be there.

"It's worth your while."


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