Jordan Tastes Fruits of U.S. Friendship

Months after the Jordanian government quietly backed the war in neighboring Iraq, this dusty industrial town is finding out that it pays to be a friend of the United States.

U.S. taxpayers are helping pay for a shiny new computer center just off the main drag of small shops and vegetable stands. Local exporters who saw profits vanish during the fighting in Iraq will soon be getting checks backed by U.S. money to pay their workers’ salaries.

The trucks that rumble through Sahab still benefit from cheap diesel fuel, because the U.S. persuaded local allies such as Saudi Arabia to supply Jordan after Iraq stopped.

“If it wasn’t for government intervention, there would be a lot of unemployment and a lot of problems,” said the town’s mayor, Hamad Jaber. “It would have a huge negative impact on our society.”

Since preparations for the war in Iraq began in earnest early this year, the Bush administration has rewarded those nations that helped out.

The 49 countries in Washington’s “coalition of the willing,” which openly backed the war, as well as countries that supported it in less public ways, have reaped political and economic benefits.

In some cases, the reward has been economic. Turkey, for instance, at first rejected a U.S. plan to deploy troops there to invade Iraq from the north. After a flurry of diplomatic pressure, Turkey allowed the U.S. to use its airspace for bombing runs and flying in supplies.

Although the country got less than Washington initially offered for full cooperation, the change of heart still resulted in a $1-billion grant to Turkey, convertible into up to $8.5 billion in loan guarantees.

In other cases, there are political rewards. Poland, one of the few European countries to back the war, endured its neighbors’ scorn. As a show of thanks, Bush visited the country a month after major fighting was declared over in May.

“I make no promises, but we will remember who our friends are,” Bush told Polish broadcasters who asked whether their country would be considered as the site for a money-generating U.S. military base. “And the Polish people have been strong friends of the United States. And for that, we are very grateful.”

Perhaps no country, however, has benefited more directly than Jordan.

Although he declined to be part of the coalition, Jordan’s King Abdullah II permitted hundreds of U.S. troops to staff three U.S. Patriot batteries in the country’s remote border region. The nation’s respected intelligence service also shared information with its U.S. counterparts.

Abdullah’s actions stood in marked contrast to those of his father, King Hussein, who died in 1999.

During the Gulf War, Hussein remained neutral to placate the large Palestinian population in Jordan that strongly backed Saddam Hussein.

Abdullah has been richly rewarded. When Congress passed the Emergency Wartime Supplemental Act in April, Jordan was one of the biggest beneficiaries.

All told, Jordan received more than $1 billion -- $406 million to buy and refurbish a new set of F-16 airplanes and $700 million in funds from the U.S. Agency for International Development -- to supplement budget shortfalls stemming from lost tax revenue. Combined with previous military and aid grants totaling $400 million, Jordan wound up with promises of $1.5 billion for the year, vaulting over Colombia to become the U.S.’ third-largest recipient of aid, behind Egypt and Israel.

U.S. officials portray the aid as an investment to ensure stability in Jordan, one of America’s closest allies in the region.

They estimated that the war in Iraq cost the country about $700 million in lost exports and fuel subsidies.

Jordanian officials say the U.S. largess was in recognition of Jordan’s important role in the region, wedged geographically between Israel and Iraq, and politically between the Arab world and the U.S.

They also say Jordan has consistently been one of the largest recipients of U.S. aid -- usually ranking fourth or fifth in terms of aid received -- in the last several years as the country strives toward economic liberalization and cooperates militarily with the U.S.

“It’s not a payback. It’s not a reward for the position we took in the war,” said Planning Minister Bassam Awadallah. “The U.S. has invested a considerable amount of money in Jordan. If our economy crumbles, our partnership will collapse and the whole partnership will have been a failure.”

But government opponents had a sharply different view of the new U.S. money.

Like residents in many Arab countries, Jordanians were widely opposed to the war. A group of professionals presented a petition to the king in March that forced him to publicly declare his opposition to the effort.

“What name can you give this but prostitution?” asked Laith Shubeilat, a conservative member of the nation’s Islamic party and author of the petition. “Our sovereignty boiled down to how many millions of dollars? It’s like ‘Indecent Proposal.’ How much will you sell yourself for?”

Much of the money will go to ease the loss of cheap petroleum. Iraq used to send Jordan about 100,000 barrels of oil per day. Jordan got the first half of the shipment free, then repaid the rest in barter -- chemicals, food and pharmaceuticals. The deal saved Jordan about $300 million a year.

Jordan has hiked prices a few pennies per gallon to generate $70 million more in revenue but hasn’t increased prices to full market value for fear of provoking unrest.

The rest of the money will supplement the shortfall from export losses. About 20% of Jordan’s trade was with Iraq.

Jordan’s trade minister, Salah Eddin Bashir, said the government is now talking about how to return the money to exporters to make up for money they lost in keeping idled employees on the payroll during the war.

“The final bill is not very clear to me yet. But whenever the exporter shows a drop, the government will address it,” Bashir said.

Local manufacturers, however, say they fear that the continually cash-strapped government will simply pocket the money to pay off its bills. At $7.5 billion, Jordan’s external debt is equal to about 80% of its GDP.

They say the government has told them that so far, the additional U.S. aid will be used to help export companies diversify into new markets -- a process they say will not help in the short term.

“We want to penetrate new markets, but that takes time,” said Hashim Qaisi, who runs a factory that makes electrical parts. “I’m losing money. I’m losing a lot of money.”

Qaisi has suffered more than most as a result of the war. About 95% of his business was in Iraq.

The only thing that will save his business, he said, is stability in Iraq. And the chances of that happening soon seem remote.

Now, as he walks through his factory complex in a cavernous Quonset hut in the dry brown hills and olive orchards just outside of Sahab, the only sound is silence.

In one corner, a few women are packing up boxes of white electrical switch covers to send out. Nearby, a long row of hole-punching machines sit silent, a single man working where 25 once labored.

Before the war, Qaisi had 459 workers. Now he has 160. Last year, he had $15 million in sales. For the first six months of this year, his sales have amounted to $1 million.

“Everything has stopped in Jordan. It’s as simple as that,” he said as he walked through his factory that once buzzed with activity. “The damage was devastating.”