	Introduction

On June 6, 2000, President Bill Clinton and King 'Abdullah II announced that the United Statesand Jordan would begin negotiations for a bilateral free trade agreement (FTA), (1) eventually leadingto reciprocal duty-free trade in goods. The Clinton Administration submitted theagreement to the 107th Congress on January 6, 2001, and bills to implement the FTA were introducedin the Senate ( S. 643 ) on March 28, 2001, and in the House ( H.R. Congressional Interest

		Congressional Interest in Free Trade in the Middle East

If the FTA wins U.S. congressional and Jordanian parliamentary approval, Jordan will become only the fourth country in the world to have a bilateral free trade agreement with the United States.Previous FTA's were concluded with Canada and Mexico, forming the North American Free TradeArea (NAFTA), and with Israel. 2268) was introduced in theHouse. First, it extended the FTA to cover goods produced ormanufactured in the West Bank and Gaza Strip. 104-234 also granted the President additional proclamation authority to extend the U.S.-Israel FTA to cover products from qualifying industrial zones (QIZs) between Israel andJordan, and Israel and Egypt. These steps have included increasing the level of bilateral economic and military assistanceprovided to Jordan, forgiving Jordan's debt to the United States, and establishing qualifyingindustrial zones (QIZs) in Jordan and Israel. In recent years, one of the most visible aspects of Congressional interest in the Jordanian economy has been in the realms of foreign assistance and debt forgiveness. U.S. Foreign Assistance to Jordan, FY1993 to FY2001 (All figures in Millions of U.S. (14)
President Clinton submitted the U.S.-Jordan FTA to the 107th Congress on January 6, 2001, and the Senate Finance Committee held a hearing on the FTA on March 20. On July 26, the House Ways and MeansCommittee approved similar legislation, H.R. The House approved H.R. 2603 by a voice vote on July 31, 2001. 2603 by a voice vote on September 24, 2001. It became law as P.L.107-43 on September 28, 2001. labor and environmental laws. USITC also predicted that the FTA "will likely leadto an increase in U.S. imports of textiles and apparel from Jordan." Trade in Goods and Services. Intellectual Property Rights (IPRs). Labor. Potential Effects of the U.S.-Jordan FTA

		Trade in Goods

Throughout the 1990s, bilateral trade between the United States and Jordan was modest. In 2000, cereals accounted for three of the top ten leading U.S. exports to Jordan. Since many Jordanian exports to the United States already qualify for duty-free or preferential access under the above-mentioned programs and the regular tariff rates (in the HTS), the FTA isunlikely to have a large impact on the volume of Jordanian exports to the United States. Foreign Direct Investment (FDI) in Jordan

Although a U.S.-Jordan FTA might not have a large and immediate impact on the volume of bilateral trade in goods and services, many predict that the FTA could substantially increase foreigndirect investment (FDI) in Jordan, both from the United States and from the rest of the world. Political Implications

Should Congress and the Jordanian parliament agree to the FTA, Jordan would become the first independent Arab country to have concluded an FTA with the United States.
On June 6, 2000, President Bill Clinton and King 'Abdullah II announced that the United States and Jordan would begin negotiations for a bilateral free trade agreement (FTA). The two sidessigned the FTA on October 24, 2000, and President Clinton submitted the FTA to the 107th Congresson January 6, 2001. Bills to implement the FTA were introduced in the Senate ( S. 643 )on March 28, 2001, and in the House ( H.R. 1484 ) on April 4, 2001. H.R. 2603 (Thomas) and S. 643 (Baucus) were reported out of the House Ways and Meansand Senate Finance Committees on July 26. H.R. 2603 was passed in the House, bya voice vote, on July 31, and in the Senate by a voice vote on September 24. It became law as P.L.107-43 on September 28, 2001.
In the past, Congress has shown an interest in developing free trade relations between the United States and select Middle East countries. In 1985, Congress approved the U.S.-Israel FTA andamended it in 1996 to include the West Bank and Gaza Strip as well as qualifying industrial zones(QIZs) between Israel and Jordan, and Israel and Egypt. Since 1994, when Jordan and Israel signeda peace treaty, Congress and the Clinton Administration also undertook several initiatives designedto assist the Jordanian economy. These initiatives included increased levels of foreign assistance,debt forgiveness, and the QIZ program.
In addition to covering traditional reductions in barriers to trade in goods and services, the FTA also deals with other issues that became part of the U.S. trade policy agenda during the ClintonAdministration such as intellectual property rights (IPRs), e-commerce, and labor and environmentalstandards. The inclusion of labor and environmental standards within the text of the FTA hasprovoked disagreement between those with differing visions of what should be included in futureU.S. FTAs.
The volume of bilateral trade between the United States and Jordan throughout the 1990s was consistently modest. Many top Jordanian exports to the United States already enter the United Statesduty-free through various programs, and cereals- the top U.S. export to Jordan-already face low orzero-level tariff rates. Therefore, a free trade agreement is unlikely to have an immediate anddramatic impact on the volume of bilateral trade. However, Jordanian exports of textiles and apparelto the United States, as well as U.S. exports to Jordan of various commodities that face moderatelyhigh Jordanian tariffs, could expand under an FTA.
In addition to a modest increase in the bilateral trade of goods, a U.S.-Jordan FTA could have several economic and political implications. These include the possibility of increased levels oftrade in services, greater foreign direct investment (FDI) to Jordan both from U.S. and foreign-basedcompanies, and reinforced momentum for further economic reform in Jordan. If approved byCongress and the Jordanian parliament, the U.S.-Jordan FTA will also mark the first U.S. free tradeagreement with an independent Arab country, thereby reflecting the strength of U.S.-Jordanianbilateral relations and the importance that the United States attaches to these relations.