Direct line

H.E. Marwan Juma, Jordan’s minister of ICT, is using his direct experience of the telecoms industry to help the sector become an engine of growth.

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Direct line Marwan Juma says the Ministry of ICT aims to spread the adoption of technology and encourage entrepreneurship.
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By  Roger Field Published  October 10, 2010

H.E. Marwan Juma, Jordan’s minister of ICT, is using his direct experience of the telecoms industry to help the sector become an engine of growth.

While many government ministers around the world are perceived as being out of touch with the challenges faced by businesses, this is not an accusation that can be leveled at Marwan Juma, Jordan’s minister for ICT.

Having held senior roles including CEO of Jordanian IDEN operator Xpress and Batelco Jordan, Juma has a strong understanding of the needs of the country’s telecoms operators and the many challenges they face.

And since taking over as minister for ICT in December 2009, Juma has been busy implementing the Kingdom’s ICT policy, which aims to make Jordan a hub for ICT and help develop the sector to become one of the main drivers of the country’s economy.
Jordan’s ICT sector has certainly come a long way since the government stated its intention to develop the sector as an engine of growth.

Today, the ICT sector contributes a total of about 14% of Jordan’s GDP, with about 9.5% of this being direct, and 4.5% indirect, according to Juma. He adds that this GDP contribution has come about as result of focusing on ICT as an engine of growth for the country.

“If you look back 10 years, it was about 2-3% of GDP, now it is about 10% direct, and that is after 10 years of hard work,” Juma says.

“I think down the line it could become much more significant, and a major source of employment and revenue for the country. I can see it easily going to 15% direct over the coming five years, and this is a serious contribution,” he says.

This 14% GDP equates to about 70,000 jobs in the ICT sector and exports worth about $150 million, most of which is “high value-add applications and products developed out of Jordan” according to Juma.

This growth has been driven largely by the level of competition in Jordan’s telecoms sector, which Juma describes as being “probably the most liberalised” in the region. Indeed, while the fixed line sector is largely dominated by Orange Jordan, the country does have five WiMAX operators and three mobile operators, placing it far ahead of most other countries in the region in terms of competition.

However, Orange Jordan looks set to lose its dominance in the fixed line sector next year, as the government starts to implement Local Loop Unbundling (LLU), a process that will allow other operators to offer fixed services and bundles.

“We took a decision on LLU, a decision has been taken by the regulator and now we are going into the application of the LLU,” Juma says. “You will see actual enforcement by the second half of next year.”

Furthermore, Juma insist that LLU will be implemented and enforced in a way that will ensure greater competition.

“What is typical with LLU is that the incumbent will resist as much as possible, that is just standard worldwide, but the regulator has sharp teeth now to ensure that it is being applied fairly and that people have access to infrastructure and we hope that will lower the cost,” he says.

Apart from LLU, Jordan is also set to benefit from greater competition from the WiMAX players. The Ministry of Communications decided recently to remove an annual frequency fee of about $1 million that the WiMAX companies previously had to pay to the government.

However, as part of the bargain, the WiMAX players must expand their coverage nationwide and lower their prices. This is expected to benefit the WiMAX players, which will be able to compete for customers throughout the country.

Aside from this, Jordan is also set to gain a second 3G operator in 2011, following the launch of Orange Jordan’s 3G service earlier this year, further adding to the competition in the data arena. Juma also “anticipates” that a third 3G operator will follow.

These developments are also being complemented by increased investment in fibre to premises, with  big companies and government departments being provided with fibre connections.

“At the end of the day, if you want serious speeds and serious broadband then I think fibre is the only technology that can deliver that,” Juma says.

To help develop the mobile broadband sector further, the ministry may look at changing or even removing the annual frequency fees that the 3G operator, and any future operators, are expected to pay.

“We may revisit looking at the annual frequency fees to ensure that the business models of these operators work and work well and that their prices are attractive and that they really build 3G networks and not quasi networks,” Juma says. “We need real 3G networks in the country and not only access in a few spots here and there.”

Furthermore, the ministry is not just looking to strengthen the mobile broadband sector, but sees all forms of data as being key to the development of Jordan’s ICT sector.

“We are focusing on the data side,” Juma says. And one way the government is promoting data is by reducing the sales tax on internet services. Until recently, the sales tax on internet services was 16% for some services, and 8% for others. There was also a 12% tax on mobile services. Now, these taxes have all been unified at a new rate of 8%.

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