Qualifying Industrial Zones in Jordan and Egypt

Publication Date: July 2006

Publisher: Library of Congress. Congressional Research Service

Author(s):

Research Area: Trade

Type:

Coverage: Egypt Egypt

Abstract:

In 1996, Congress authorized the creation of Qualifying Industrial Zones (QIZs), thereby entitling goods jointly produced by Israel and either Jordan or Egypt to enter the United States duty free. The QIZ creation vehicle was an amendment to the United States-Israel Free Trade Area Implementation Act of 1985 (P.L. 99-47), and its purpose was to promote peace and development between Israel and her Arab neighbors. Although Israeli-Palestinian violence has continued, some observers have praised QIZs for helping to spark Jordan's economic growth. Others note that QIZs, while promoting U.S.-Jordanian trade, have had modest impact on promoting job growth in Jordan. In 2005, Egypt began participating in the QIZ program. This report provides an overview of QIZs in the context of promoting regional development and peace. It will be updated periodically to reflect recent developments. For more information on Jordan, see CRS Issue Brief IB93085, Jordan: U.S. Relations and Bilateral Issues, by Alfred Prados. For more information on Egypt, see CRS Report RL33003, Egypt: Background and U.S. Relations, by Jeremy M. Sharp.