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Allowing Aqaba to reach its potential

Mar 26,2015 - Last updated at Mar 26,2015

Aqaba is not merely a historical place and the only port Jordan has, it is also an economic opportunity.

Investments poured into it since King Abdullah’s accession to the throne exceed $20 billion. The return on such investments in 2014 may not have reached 1 per cent.

Viewed from a different angle, the value of previous and ongoing infrastructure and profit-driven ventures is equal to 65 per cent of Jordan’s total public debt.

Thus, only Midas’ touch could make Aqaba generate an annual income sufficient to foot the public debt servicing.

The range of diversified projects with the potential to generate income is impressive.

Since 2000, Aqaba’s hotel rooms increased about
eightfold to 11,000. The average occupancy on a yearly average is about 35 per cent.

There were no universities or hospitals in Aqaba in 2000. Now it has three universities and a new military hospital. The hospital is busy, but we need more, and end-of-the-line health services for both residents and visitors.

Universities operate on a shoestring budget and their student population is low.

The port has undergone severe decline in total handling and number of ships laying anchor. It is obvious that the earth-shaking events in the countries around have taken their toll on this sector.

Al Hussein Airport, whose departure section is being expanded, only receives two flights daily from Amman and occasional chartered flights.

Although the price of real estate has gone up, many apartments and houses are unfinished or remain without tenants.

There are mega-projects under implementation, such as Tala Bay ($2.8 billion), Saraya, completed and sold to Kuwaiti investors (estimated to be worth $1.5 billion) and the UAE-financed project of Al Maabar, estimated to cost $10 billion upon completion.

The government is building two liquefied and natural gas ports, soon to be commissioned. A railroad connecting Wadi Al Yutum with the Aqaba Port will be soon declared for bidders.

And, of course, there is the first part of the Red-Dead project, on which an agreement was recently signed in Washington, DC.

There are many private sector investments in hotels, hotel suites, apartment buildings, shopping malls, shopping arcades, industries, etc.

Many owners complain of decreased consumer appetite.

Although Aqaba’s population has almost quadrupled over the last two decades, getting there is still not easy for people coming from other places.

Those who brave taking the desert road may end up paying one traffic violation, crowded by moving trucks or losing a tyre along the bumpy road.

Plane schedules are designed for people who go to Aqaba on trips, and not for those who want to stay.

His Majesty’s focus on tourism is well placed.

Aqaba needs to diversity its tourist package. It also needs to invest in high-quality services needed by people who can afford to eventually buy and reside in the plush suites and apartments overlooking the sea.

There is a dire need to leverage the funds invested in Aqaba. To do that, good management is required.

The Aqaba authority has had nine heads since its inception in 2001. Hani Mulki comes with energy, vision and a sharp sense of commitment.

All that Aqaba needs is a team of devoted people who can effect positive change.

The government needs to relax its grip on Aqaba and allow it to develop undeterred by petty skirmishes over who should do what.

The hands-on approach has caused this huge project to miss its target.

The writer, a former Royal Court chief and deputy prime minister is a member of Senate. He contributed this article to The Jordan Times.

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