UAE and Jordan sign pacts for $2.3bn railway investment project

The network will connect Jordan's port of Aqaba with mining regions in the country

A tanker docked at the port of Aqaba in southern Jordan, on the Gulf of Aqaba. Getty

The UAE on Wednesday signed four agreements with Jordan for a $2.3 billion railway investment project that will link the port of Aqaba with the mining regions of Al Shidiya and Ghor es-Safi.

This is part of the investment package worth approximately $5.5 billion that Jordan signed with the Emirates in November last year during the state visit of King Abdullah II of Jordan to Abu Dhabi, the Jordan News Agency reported.

The project will initially start with transporting 16 million tonnes of phosphate and potash products, the report cited Jordanian Prime Minister Bisher Al Khasawneh as saying.

Studies on railway routes and handling requirements for potash and phosphate are expected to be completed between 2024 and the end of 2025, with the aim of submitting tenders for construction work in 2026.

The agreements were signed by UAE Minister of Investment Mohamed Alsuwaidi and Jordanian Minister of Investment Kholoud Al Saqqaf, in the presence of Jordanian Prime Minister Bisher Al Khasawneh. Photo: Jordan News Agency

The railway project is expected to take up to five years to become operational, which will create new employment opportunities in the railway network, mining, logistics and associated industries, added Mr Al Khasawneh.

Jordan's government is placing significant emphasis on developing the mining sector, which is currently dominated by the production of phosphate, potash, building and decorative stones, pure calcium carbonate and other non-metallic resources.

The mining industry is expected to continue growing, with its contribution to the country’s economy anticipated to reach 2.1 billion Jordanian dinars ($2.96 billion) by 2033, up from nearly 700 million dinars last year, according to the National Mining Strategy.

Jordan also aims to increase the mining sector workforce to 27,500 in the coming years, according to a report by Jordan News Agency.

The latest collaboration with the UAE comes as the countries are seeking to boost economic co-operation.

Non-oil trade between the UAE and Jordan surged by over 47 per cent in 2022, reaching $4.5 billion – more than double the total in 2020 – according to UAE government data.

The growth continued in the first half of 2023, with trade flows totalling $2 billion.

“We aim to build new economic and investment bridges that support infrastructure development and offer promising opportunities,” the Jordan News Agency report on Wednesday quoted UAE Minister of Investment Mohamed Alsuwaidi as saying.

In November, the Jordan Investment Fund signed a pact with Abu Dhabi's holding company ADQ to establish an investment fund in Jordan to focus on infrastructure and development schemes.

In June 2022, ADQ also launched a $100 million technology-focused venture capital fund in collaboration with the Jordanian Ministry of Digital Economy and Entrepreneurship. The fund aimed to invest in high-growth companies with proven business models.