2008 Gov Budget

I had a chance to watch the minister of finance deliver his budget proposal on the floor of the parliament and was not happy at all.

The new budget aims to help the poor and needy and provide a more equitable distribution of income. Sounds great, however, the government plan is flawed as it hopes to achieve this by linking civil servant's salaries with inflation. IMHO, a sure recipe for double digit inflation rates.

Here is how things would probably play out:

1) Government increases civil servant's salaries and minimum wage in correlation with inflation numbers from the previous year.
2) Private sector increase wages based on the new minimum wage and then some more to attract some of the people who might consider government jobs.
3) Commercial sector increases prices due to both increased labor costs and also to take advantage of the increase in the average Jordanian's income(due to the wage increase.)
4) At the beginning of the following year the inflation numbers on which the new wages are computed are higher because all wages(prices) went up and the cycle starts again at number 1

The other thing that I fear from linking wages to inflation rates is that we might lose our competitiveness, and this is already happening to some degree; a number of factories are being moved from the industrial area in Irbid to Egypt because of the significantly lower wages(more than 65% less in some cases.) We might also end up losing some touristic business as the cost for visiting jordan is a bit on the insane side(especially hotels)

In the long run the government can only slow this by not going ahead with its plans. In the long run we need to have industries that have a significant amount of technical knowledge that would not be available in countries that depend on low wages to increase the competitiveness of their goods like Syria and Egypt.

Govermnent Is Investigating

Every once in a while, I read the something along the line:

"Government is investigating the use of Nuclear energy"

"Government is studying the feasibility of XYZ"

The main problem with this is that the Government is always investigating this or that, but more often than not, if you fast forward 5years later, you will find out that the investigation leads to no action.

What is even worse is that the government revisits certain issues with a new fully fledged investigation as if no previous investigation(s) took place. I call this reinventing the wheel.

In many instances plugging the new numbers into the old formulas would be sufficient. For example, let us say that wind energy was not a good idea when oil prices were in the teens of dollars, and the payback period was something like 20years. Using the new oil prices in the same old formulas would yield a payback period of say around 7.5 years. Of course, I am oversimplifying here.

But no, we need to waste tax payer's money, so we have to do a completely new study every 5 years.

Ok, I seem to have digressed a bit, so what I want to talk about is the issue of Jordan investigating Nuclear energy. I was very annoyed when I found out that Jordan is serious about this. Yes nuclear energy is nice, is environmentally friendly( if there is no Chernobyl like leakage), and in the long run is cheap to produce. But the question is, is it for Jordan?

Jordan is not the kind of country that can make huge investments in large chunks. For a country of Jordan's financial situation, it makes more sense to make a small investment of say 50-100million every year in renewable energy sources like wind energy.

Three years ago, I had to quote a 1MW wind energy converter. It was for around 380000 Euros. Using the logic from above, the government can choose to buy 1, 2, or even 100 units, in one year, and then maybe zero units in the following year and then maybe 50 in the year following that and so on and so forth.

Due to the relatively small price tag, there is a lot of flexibility in mixing and matching. Add to this the fact that the price of wind energy is going down every year and wind energy converters are becoming more efficient year over year, then you see that you will be getting more bang for your buck as time goes by.

Now with Nuclear energy, it is a one time investment, and no flexibility exists whatsoever. As for getting more bang for your buck over time, this may or may not be true. But in all likelihood the next Nuclear plant for Jordan will be installed 10-20 After the first one.

Two other things come time to mind regarding nuclear energy. It is putting one's single egg in a single basket, which would not come in handy in case Jordan ever needed to go to war. And there is also the fact that Nuclear Energy requires technical knowledge which Jordan currently lacks. I do not know about you, but it has been a while since I heard about a local nuclear scientist. And I do not want my countries' Nuclear plant to be run by some Pakistani nuclear scientist.

Since almost nothing does come out of these government investigations, instead of wasting time and money trying to invest in new energy whether it is wind or nuclear, things can be done in the here and now and with almost no cost to make use of what we currently have; government can change new building codes to require mandatory insulation(that alone saves more than 30% in cooling costs.) The government can issue a ban on incandescent lamps starting 2010. The government can pass a minimum standard for energy efficiency for industrial facilities or office buildings. It can turn itself, or Jordan as a whole green.

Speaking of the latter, two months ago, I read that Dubai was considering going green. So why not us? Why not beat them to the punch? The only thing it takes is legislative effort.
Going green does pay for itself. I can speak about this from first hand experience; my 3 compact florescent lamps and solar water heater already paid for themselves and it does show in my electricity and fuel bills .

The Clueless FDA

For the last four years, I have been trying to sell compressed air filters to various plastic factories that produce food packaging, without much success.

These filters are used to remove compressor oil from compressed air and prevent it from contacting the packaging. If it is present, this oil could be a potential health risk in the long run for the consumers as this oil is always mineral based and not food grade. This is almost like eating the oil in your car engine, after you have used it to drive the car for 6000km.

I must say that I was not very surprised when not a single plastic factory bought from me, or anyone else for that matter. After all, the health of the average consumer is not worth 500JDs per year.

And I must say that it does not surprise me either that the Jordanian FDA does not know anything about this. Having dealt with the Ministry of health(and the Jordanian FDA) both as a business owner and when I represented the Dairy industry at the Jordanian Institute for Standards, I knew that these people do not know their asses from their elbows, all they know is that the material is food grade, therefore the final package is food grade.

Of course, for anyone who knows anything about the food industry, this is a clear case of non sequitur. The Jordanian FDA should be ashamed of itself for not knowing anything about this matter, but also for not knowing so many things.

The greatest problem with the Jordanian FDA is that the stuff are lacking both in experience and technical knowledge. And while they can be a bit excused for the former, in the age of the internet and electronic documents, the latter is an excusable crime.

IMHO, the Jordanian FDA is a partial waste of the tax payers' money and is only partially effective.

Office for Sadistic Affairs

A typical conversation inside the government's Office for Sadistic Affairs(a fictional office)

X: Sir, we won't make the budget this year.

Y: Right. Is there a way can get more money from the poor bastards, while at the same time making their life miserable.

X: Sure Sir

Y: Like what?

X: We can increase the revenue stamp fees and at the same time make the stamps not available at post offices. Instead they would sell at the closest grocery store, which could be up to a mile away from civilization and would probably sell them for twice the price.

Y: Really!!! Great.

X: Sir, we already tested this at several post offices and it was a great success; already, several citizens shot themselves in the head, mutilated themselves, or tried to jump from the top of a mountain.

Y: Uh-huh, wow.

X: So, we can make it standard procedure everywhere if you would like.

Y: Make it so.

While such an office does not really exist in the government, the various ministries are filled to varying degrees with employees just like X and Y. Of course, the conversation would not be as "intelligent" as this, but the result would be about the same.

Parks

It does not happen often happen that I praise the government on anything, not because I am a government hater(which I am not,) but largely because the Government, more often than not, does not deserve my praise.

However, this time around I must praise the Government for the Hussein Gardens(park.) This is probably the first time that we have a decent park inside Amman itself. It is also the first time that kids have play grounds to play football in, instead of playing on the street and endangering their lives.

Now, the criticisms part, we need more of this, and soon. Probably, a couple of extra parks for Amman itself. But also in other cities like Zarka, Madaba, and Irbid.

It would be nice, also, if the government did not build these out of tax payer's pockets which are already empty.

Tribal Law

I knew this from before, but it did not get to the foreground of my brain until today.

We are now almost 8 years into the 21st century and tribal law is still applied in matters related to accidental killings.

Yes, if someone ran over someone's child and killed him by accident and even if there were witness to testify to this, the driver in question would still have to go through the archaic process of "Atewh" and paying the "Dyeh" as compensation. And this process can almost destroy the life of the driver in question, because sometimes, the family of the deceased might decide to secure their retirement from the "Dyeh" money. Not to mention that the guy could rot in jail until the family of deceased decides that they have no problem with letting him out.

This process makes no sense what so ever. What even does not make any sense is that the government has no problem with it. Maybe modernizing only applies to certain things, but not to others.

I am not sure how this process can be replaced. But we need not look very far; many countries have never had any tribal laws and are doing just fine and have rather successful civil laws in place.

Moving Backwards

Yesterday, I went to renew the license for my company at the Municipality of Amman. Last year when I renewed the licence I had to fill out two forms. This year, I had to fill out five forms that had exactly the same information. So I told the guy who was helping me that it was only two forms last year. His reply was that it was last year not this year.

Luckily, aside from the extra time to fill the extra three forms, the rest of the renewal processes took about the same time as last year.

In it's website, the municipality states among it's goals:

• Administrative development.
• Optimum use of resources
• Reducing costs of services through citizens’ increased collaboration

Since the renewal time this year has taken more time, not less, I would say that the municipality is failing miserably at achieving its goals and is only paying lip service to them.

The three additional forms are sure not an optimum use of resources, they are not a reduction in cost and they do not contribute an iota to administrative development.

This is somewhat an annoying feeling, but I get the feeling that we are not progressing at all and are actually moving backwards.

Education in Jordan, part 2

This a follow up to my previous blog post.

I was thinking about what Jordan needs to do to improve the university level college education. Here is what I think should be done:

• Performance evaluation of professors by students based on which the university decides if he should go or should stay; get a raise or a salary reduction.
• If a professor has a high student failure rate for example more than 25% he should get the pink slip.
• English should be the official language of education in all public and private universities. After all, we live in a globalized world whose lingua franca is English and not Arabic. This will also help Jordan export labor to countries other than the gulf, for example Ireland, Australia, Canada and other places in need of English speaking skilled labor.
• Pay attention to world wide university rankings and try to move up the ranks.
• Professors should be hired with at least 4 years of industry experience, where applicable, to ensure they are not so far away from reality and more on the practical side.
• At least 20% of university professors should get their PhDs from the Top 500 universities world wide.
• At least 20% of University professors should be USA, UK or Ireland natives. This will ensure that students are exposed to a different kind of teaching. I know this will cost Jordan a lot, but nothing is for free.
• Courses for each discipline should be checked for their relevance to the real world applications for the field of study. I know some courses have to be taken just for the sake of maintaining accreditation, but still, the content should be improved as much as possible so that it is more on the practical side.
• Professors should be certified in training (training of trainers). This is somewhat different from education, but it does make things a bit more practical.
• Yes, more funding for research and for the universities in general, but this should not come from increasing education fees or from higher taxes.
• More scholarships.

Education in Jordan

Maybe a couple of months ago, I was reading an article in Jordan Business Magazine about why Jordan should try to go for educational tourism instead of medical or regular tourism. According to the article, students spend 4 years to get their education; therefore, they end up spending significantly more than what people would spend on either medical tourism or regular tourism.

I have no problem with this logic and it does make a lot of sense. My problem, however, is that education in Jordan is still basically crap when compared with the rest of the world.

I spoke to someone who works as a lab teacher in a private university, and he told me horror stories about the quality of education here. For example, one private university kicked out a few students without good reason and they were reinstated by the higher education board.

Public education is not much better either. The fact still remains that not a single university in Jordan, public or otherwise, made it to the top 500 Universities in the world list. Just check the link:

http://ed.sjtu.edu.cn/rank/2006/ARWU2006TOP500list.htm

This is a very sorry state of affairs. If you look at how full of our selves we are about education in Jordan, you would think that half of our universities are in the aforesaid list. But the truth is that not a single one is and we just like to delude ourselves.

I am not sure what the minister of higher education does. But I think someone should tell him about this list and our none-existing presence in it and see what he has to say.

One, final thing, I was very happy to see the University of Cairo making the list. It is probably the only Arab University in the list. Egyptians, keep up the good work.

Voting Out

I was a bit shocked when I heard about the fist fight between the journalists and members of the house of representatives. If things were up to me I would call for early parliamentary elections to kick out most of these good for nothing representatives.

Yes, that is correct. Just yesterday, in my Anti 4x4 blog post, I wrote: " I am not sure what the representatives in the lower house are busy with, but I have no doubt in my mind that whatever new law they are working on, it will not add much value to the lives of us "average" citizens." Well, today, during an interview with AL-Jazeera, the head of the Journalists association talked about the fact that most people are not happy with the representatives in the lower house.

As a partial solution, maybe we should have parliamentary elections every two years instead of four, that should put some heat on the lower house to perform in accordance with what the people want. This is sort of what they have in the US, and they call it mid term elections.

Unfortunately, this is somewhat hard to achieve since it would probably require a constitutional amendment. And as far as I know constitutional amendments are very hard to come by.

Anti 4 x 4

I stumbled on a UK based anti Urban 4x4 website. It got me thinking, we need to be "anti" urban 4x4 too. Hell, we need to be "anti" any car that has an engine bigger than 2.0 ltrs.

Why? Because these cars are great polluters and guzzle up fuel like there is no tomorrow. They produce twice the emissions of the regular 1.4-2.0 ltr cars and therefore harm the environment twice as much.

So why doesn't the government do something about it? Why does doesn't the government have any fuel consumption, or EU like emissions requirements for new cars? Come to think about why doesn't the government have any regulations of value when it come to cars?

Previously, I talked about the child seat issue. We have no regulations for that. Car safety is not an issue for the government, so we have no regulations to deal with mandatory air bags, promotion of dry air/nitrogen tire filling, or a minimum safety when it comes to car crash tests. I am not sure what the representatives in the lower house are busy with, but I have no doubt in my mind that whatever new law they are working on, it will not add much value to the lives of us "average" citizens.

Fight Aids The Wrong Way

I do not watch TV, but yesterday I had the misfortune of passing by the TV in the living room while the government advertising for Fight Aids was on. I will not talk much about how uncool it was. I want to talk about it's content.

The minister of health talks about preventing AIDS, by not having "sex outside marriage." The minister did not feel comfortable about calling a spade a spade, so he took liberty and omitted some facts to preserve the "innocence" of the average Jordanian viewer. The part he omitted is about protected sex.

The official government position is that we are a moral society and if sex does occur out side marriage it is usually rare and for money. We all know that is not the case. I am sick and tired of the government playing the moral face, and acting like people are stupid.

Qualifications Of The Minister of Culture

Subject to securing a work permit, I am willing to relocate to the USA, Western Europe, Canada, or any country where English is the primary language.
I was talking with my friend about various culturally oriented issues and the subject of the minister of culture came up. As I do not watch the news or read the local paper I did not know who the culture minister of the month was. My friend said that the last or current one was/is a poet. He also said that he was not very good. I said that is normal, the best doctor can not run a hospital; the best sales man is not well suited to be a sales manager and so on. This is well know in the management world and is well documented, but somehow the government did not hear about it. So they still put mediocre performing people to serve as ministers. Anyway, I will be going a list of qualifications for the various minister's positions. Today I will start with the minister of culture. So here I go:

1) No moustache, and no big belly
2) Good command of English language. Command of additional languages a big plus.
3) A BS/BA degree as minimum but no PhD's as PhD's tend to be too impractical
4) Lived abroad for at least a few years
5) Does not consider the Maa'n Dabkeh Group great
6) Visited at least 20 art shows and knows a few local artists
7) Attended many cultural events in and outside Jordan, including art shows, theater, music concerts and the like.
8) Can work with other people and has a vision
9) Has limited interest in control
10) Can work with local artists, musicians, the foreign embassy donor community on "promoting" and "improving" culture, through the holding of various events and also improve the quality of local TV and Radio programming.
11) Must have an IQ of at least 120
12) Must have an EQ of at least 110

One other suggestion regarding choosing ministers, I know that in most countries, ministers are chosen by the prime minister. But that is very stupid, IMNSHO(in my not so humble opinion.) This a job and I think a job at the level of minister should no be decided by one person (the prime minister in this case). In an ideal situation, the minister would choose 3 candidates for each position, and a non partisan panel would interview these candidates, review their credentials and previous work and choose the most qualified person for the job.

This is somewhat a better system, but then the problem that arises is how to choose the best people for this panel? I do not know the answer yet, so I will leave it for another blog.

Customs

I am a typical trader who imports stuff from abroad. My problems are the same problems that other importers face.
Sometimes my shipments would arrive from Germany, or from wherever on a Wednesday night. The customs have half Thursday off and leave at 12:00pm. They are also closed on Friday and Saturday, so if Sunday is not a holiday and there are no other holidays, the clearance company would get me my stuff by Tuesday, or Wednesday, which means that it takes almost a week to clear stuff out of the customs, it also means that the employees in the customs are only working 32 hrs per week which is really very little.

Considering how many people in trade and industry import stuff, I think that the number of work hrs at the airport customs should be increased to 40 hrs/week spread over 6 days, so that people in urgent need of their stuff would get it on time. I do not think that any person who imports stuff would mind paying a few JDs extra to cover the increase in work hours.

21st Century

Here in Amman, if I wanted to get my signature notarized for matters related to property, inheritance, or the likes, I have to go to the Justice palace in Abadaly. And while I live in Shmisani, which is not far away from Abdaly, I find it really annoying that the institution of notary public is very centralized, as are other things in Jordan. This is really ok if we want to remain in the 20th century, but if we want to move to the 21st century, we need to start paying attention to how far behind we are. I want to find a notary public within 10min of my location regardless of where I am in Amman, Zarqa, or Irbid.

And while I am still talking about the same subject (the notary public,) I find the fact that one needs to have two witnesses present in order for the notary public to notarize powers of attorneys, to be totally retarded. It simply belongs to a time when computers and technology did not exist. It can be replaced in so many ways. For example, the person who is getting his signature notarized can also stamp his finger print, or alternatively two notary publics can do the notarization instead of the current one notary public and two witnesses.

Jordan Economy, part 2

Visiting customers in the industry, and going to restaurants, hotels, and cafes, I am exposed to both the industrial sector and tourisms, so I can claim that I know what I am talking about. The main problem in Jordan is than people do not want to work; a ministry of labor report two weeks ago confirms this. The number of unemployed is around 250000, and the number of foreign labor is also 250000. This is a real joke. In theory, Jordan can have 0% unemployment. Maybe in practice, it can go down to slightly less than 10% (around 15% actual)which would be really good for an Arab country.

I have really no solution for this problem; I really do not know how to make the Jordanian people want to work, or accept menial jobs instead of no jobs. Maybe having mandatory military service would help, not the previously used 2 yrs version, which I bet sucked big time, and cost the government too much, but a 90 days version. Suggesting this is a bit hypocritical on my part, because I would not even do military service for money.

Jordan Economy

I decided to share some of my thoughts on the Jordanian economy. I have been thinking for the last two years, or maybe even more, that despite the good growth rate in the economy (almost twice the population growth rate,) that Jordanian economy is not out of the woods yet and it will not be for a while. What most people are not noticing is that Jordan seems to be putting the few eggs that it has in one basket. Actually when I say Jordan here, most people think it is the government, when in actuality it is not. Jordan suffers among other things from form what I would call "Mobile shop syndrome" Or "Shawerma place Syndrome" One person opens up a mobile shop and 10 seconds later everyone else opens a Mobil shop next to him.

Now the hottest bandwagon that everyone seems to be jumping on is real estate. That is all nice, but I really do not see what value real estate adds in the long run.

Now regarding the Jordanian industry where I have most of my day to day observations, this is truely where all the eggs are in one basket. And the government is not the one to blame here. For some odd reason, just like mobile shops, everyone wants to open a factory to sell stuff to Iraq, from plastic products to pharmaceuticals. But as usual people have very short attention spans and even shorter memories. I do remember how after the first gulf war, most factories exporting to Iraq almost went bankrupt. This is a fact most people forget. I understand that it is easier to export to Iraq, as other bordering markets are virtually closed( Israel, Syria, KSA) for various reasons. But from what I have seen, Iraq is a viable market maybe for a maximum of 3-4 years. So in the mean time, the industry needs to start thinking differently, it needs to be less traditional, and think about a way to sell outside the Arab region, to sell a large set of products, not only textiles, pharmaceuticals, but other things too.