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AMMAN –– Residential apartment purchases are fuelling Jordan’s property market, according to official data, which show that demand for land is declining. 

Figures released by the Department of Land and Survey (DLS) on Sunday showed that real estate trading during the first quarter of this year reached JD1.8 billion, a 26 per cent increase over the same period of 2013 and higher by 74 per cent when compared with the first three months of 2012. 

Trading during the January-March period of 2013 was JD1.4 billion, while in the same period of 2012 it stood at around JD1 billion, DLS statistics show. 

Housing developers expect the performance of the market to peak to pre-2008 levels as they project trading for 2014 to reach over JD7 billion. 

Government revenues from real estate trading also grew tangibly during this year’s first quarter to reach nearly JD100 million, 24 per cent higher than the JD80 million generated in the first three months of 2013 and up by 65 per cent from the JD60 million recorded in the same period of 2012, according to the DLS report e-mailed to The Jordan Times. 

The figures indicated that apartment purchases between January and March of this year rose by 24 per cent, while land transactions declined by 10 per cent when compared with the same period of last year. 

The report pointed out that the number of apartments sold until the end of March was 8,305 units compared to 6,674 flats sold during January-march period of 2013. 

Nearly 90 per cent of the residential apartments were bought by Jordanians as non-Jordanians –– mainly Iraqis, Saudis and Kuwaitis –– purchased only 887 apartments worth JD79 million during the first quarter of this year. 

Land sales during this year’s first quarter dropped to 16,448 transactions from 18,307 in the same period of last year, down by 10 per cent, the data showed. 

‘Even stronger performance projected’ 

Jordan Housing Developers Association President Kamal Awamleh told The Jordan Times that trading in the real estate market is set to exceed JD7 million due to increasing demand for residential apartments by Jordanians. 

He attributed the surge in demand to new economic realities in Jordan as prices rise from one year to another, a fact that made Jordanians realise the need to buy housing units. 

Rise in rentals, caused by the inflow of Syrians into the country, also made Jordanians prefer to buy than rent, he said. 

Mohammad Sallam, a housing developer, agreed with Awamleh, indicating that the majority of potential buyers approach his company are mainly Jordanians.  Sallam said that demand in the coming months is expected to increase sharply as Jordanian expatriates in the Gulf region start to return to Jordan for summer holidays.

AMMAN — Finance Minister Umayya Toukan valued a positive appraisal by the International Monetary Fund (IMF) of Jordan’s economic performance describing it on Sunday as a validation for investors to set up or expand their businesses in the Kingdom.

He told a press conference that tackling a 12.6 per cent unemployment rate requires considerable investments, but for such large amounts to flow, the country should reassure investors with the right macroeconomic structure in terms of legislation, taxation, law enforcement, stability and security, sound financial management, and prudent planning.

According to the minister, the IMF assessment this week was a substantiation of Jordan’s reforms, progress and development.

Toukan expressed confidence that sizeable investments will be made this year especially in the water, transport and energy sectors and spoke of extremely low prices of shares listed on the Amman Stock Exchange as  profitable opportunities.

However, Toukan stressed the importance of employment as a major challenge facing the country. 

He said Jordan’s capabilities are limited and, regardless of growth rates, there is no escape from the fact that Jordanians should seek jobs abroad.

“Even if it rains money, the Kingdom cannot absorb all those who graduate from universities,” the minister remarked. 

The IMF said in a statement late Friday that growth increased to about 3 per cent in 2013, noting strengthening activity in financial services, telecommunications, trade and construction.

It predicted growth to gradually rise to 3.5 per cent in 2014 and to 4.5 per cent in the medium term. 

The statement expected the inflation rate to continue dropping from just over three per cent in 2013, to about 2.5 per cent at the end of this year and 2 per cent in the medium term.

Reflecting a lower energy import bill, the IMF projected a gradual improvement in the current account deficit (including grants) to approximately 4.5 per cent of the gross domestic product (GDP) over the medium term, noting that risks to this outlook remain high, mostly due to the Syrian conflict and the further disruptions in energy imports.

It estimated that in 2013, the current account deficit has improved by over 5 per cent of GDP, to less than 10 per cent of GDP,  helped by lower energy imports, higher transfers and private receipts.

Toukan told journalists that Jordanians are beginning to rationalise energy consumption giving as an example a hotel owner in Aqaba who turns on the lights of the inn only on Thursday, Friday and Saturday.

Finance Secretary General Omar Al Zu’bi said the energy import bill should be on a downward course indicating that the government will pay the National Electric Power Company (NEPCO) JD1.5 billion this year.

Zu’bi added that the amount should cover the losses of NEPCO, its debts, and the arrears it owe to the Jordan Petroleum Refinery Company.

“The adoption of revenue measures and increase in electricity tariffs is expected to ensure that the 2014 budget and NEPCO’s losses are consistent with the authorities’ objectives of reducing the combined primary deficit to 8.3 per cent of GDP, from 9.3 per cent in 2013,” the IMF statement said.

It added: “Beyond 2014, the medium-term energy and water strategies will gradually return the utilities to cost recovery.”

The IMF commended Jordan’s financial sector reform by underlying its gradual progress, describing the banking sector as “stable and overall sound”, and indicating that the monetary policy will continue to focus on maintaining appropriate international reserve buffers.

“The Central Bank of Jordan is working on making the sector more resilient, including by improving the collection of supervisory data and enhancing the regulatory framework,” it said.

Toukan acknowledged the importance of interest rates as an important factor in investment decisions and emphasised that special consideration should be given to small- and medium-sized enterprises as engine of growth and not only mega-corporations.

In the press conference dialogue, Eyad Qudah, director general of the Income and Sales Tax  Department, pointed out that revenue from the sales tax surged by JD150 million during the first three months of this year compared to the amount collected during the same period of last year.

Qudah indicated that a financial committee is following up intensively on salvaging around JD2 billion of sales tax overdues that have accumulated over several years.

Describing the task as arduous and lengthy, the director general said that tangible progress is slowly being achieved although he expected that only JD0.5 billion will be retrieved. 

He spoke about the fuel subsidy cash payments, indicating that a more than 900,000 persons have submitted applications but only around 700,000 were found to be eligible beneficiaries.

Munzer Al Assaf, director general of the Customs Department, revealed that revenue was higher by JD58 million during the first three months of this year compared to the same period of 2013.

Mohammed Al Hazaymeh, director of the budge department, told the journalists that, for the first time, the Ministry of Finance is issuing quarterly payment orders to various ministries and government departments within a strategy of control and financial discipline

Hazaymeh also mentioned administrative changes whereby a number of posts, such as advisers, were cancelled at several government institutions.

The minister concluded by assuring journalists that all is progressing as planned with regard to Jordan’s  $1 billion Eurobond float guaranteed by the United States and expected the launch before the end of June 2014.

AMMAN — Jordan Enterprise Development Corporation (JEDCO) announced Saturday in a press statement that 56 Jordanian companies will take part in the first Jordanian exhibition, slated to be held this week in Kuwait. The companies’ participation is organised by JEDCO and International Promoters Company. JEDCO Chief Executive Officer Yarub Qudah indicated in the statement that  the companies operate in the sectors of industrial engineering, pharmaceuticals, medical appliances, health services, Dead Sea products, cosmetics, plastic industries, food manufacturing and information and communications among others.

AMMAN — Jordan offered to be a centre for storing and distributing fresh Australian meat to neighbouring markets due to its geographical location, according to a press statement from the Ministry of Industry and Trade. The press statement alluded to the discussions that took place on Thursday between Industry and Trade Minister Hatem Halawani and Australia Arab Chamber of Commerce and Industry Chairman Geoff Puttick. Discussions between the two sides also covered the possibility of exporting meat to Jordan at competitive prices and setting up a medical equipment plant. Halawani outlined Jordan’s most important economic developments besides the competitive investment climate among regional countries stressing the Kingdom as a gate for accessing neighbouring markets. He called on Australians businessmen to invest in Jordan and take advantage of the Kingdom’s available opportunities as well as forming private sector partnerships stressing Jordan’s central location as a gate for accessing other countries’ markets. Puttick expressed Australia’s willingness to boost economic cooperation with Jordan, especially in commercial and investment fields.

BOSTON — For some executives, corporate perks are getting just a little less exciting.

A number of major US companies are cutting back on glamorous luxuries like personal jet use, country-club memberships, and luxury rentals, recent corporate filings show.  Often the shifts follow pressure from shareholders, who in recent years have criticised soaring executive pay and over-the-top perks. 

But it doesn't mean that the "extras" package that comes with a C-suite job is in decline — in many cases the surging value of  more mundane freebies like financial planning assistance or life insurance is more than making up the difference.

"Companies are really digging in on identifying what areas it makes sense to focus their benefits programmes," said Robert Newbury, director at pay consulting firm Towers Watson. "You will see companies spend less on areas that raise red flags with investors."

Take for instance casino mogul Steve Wynn. He began paying out of his own pocket in November for his Las Vegas luxury villa after years during which his company Wynn Resorts Ltd. took care of the bill — which was more than $450,000 a year.

"The new treatment of Mr. Wynn's villa is part of an overall change of executive compensation to ensure the company is aligned with best-in-market compensation practices," Wynn Resorts spokesman Michael Weaver said.

At the same time, Wynn — who in December was featured on a "Truly Outrageous CEO Perks" list produced by the financial news service 24/7 Wall St because of the villa freebie — saw a company contribution to his insurance and benefits nearly double to $33,293 in 2013 from $18,125 in 2012.  

And he got "merchandise discounts" of $56,196, more than double the $23,057 he received in 2012. The filing did not give more details about what these discounts were for and Weaver declined to comment.

For AT&T Chief Executive Officer (CEO) Randall Stephenson the value of his "other compensation" — costs outside of traditional areas like salaries, bonuses and equity awards — dropped 35 per cent in 2013 to $522,203, according to its proxy filed last month. The drop was mainly because he now reimburses the company for personal use of AT&T aircraft, a spokesman said.

The policy is one of several that AT&T adopted to show "its commitment to paying for performance and aligning executive pay with stockholder interests," the company said in a filing reporting the change in March 2013. 

The telecom giant has been slowly cracking down on perks in recent years — from 2011 onwards it stopped paying fees for executives' country club memberships.

A decline in flying costs could also be seen at Facebook. CEO Mark Zuckerberg's cost for personal use of company aircraft was $650,164 last year, down almost half from $1.2 million in 2012. The aircraft were "chartered in connection with Mr. Zuckerberg's overall security programme", Facebook said in a filing, which did not give a reason for the decline. The company declined to comment.

Curtains open 

The changes are in line with broader trends in compensation, experts say. 

Towers Watson, for example, found just 36 per cent of Fortune 500 CEOs got company aircraft for personal use in 2012, down from 53 per cent in 2007. However, the median value for the personal use of aircraft among those who had the perk was $125,473 in 2012, up from $92,596 in 2007 — likely due to factors like higher fuel prices.

"You would have to say this is one of the real successes of the critics of executive pay," said pay consultant Alan Johnson. "They opened the curtains and everyone said, 'Oh my God, why we paying for all this?'"

Banks in particular have backed away from perks that brought them heat from lawmakers and regulators as they got bailouts during the financial crisis. 

Morgan Stanley Inc. paid $368,675 for then-CEO John Mack's personal use of company aircraft in 2008. But since then, Mack and his successor James Gorman paid out of their own pockets for such flights.

Another Morgan Stanley executive, wealth-management head Gregory Fleming, has received no perks since 2011, a recent filing shows. Fleming  worked at Merrill Lynch until 2009, around the time then Merrill CEO John Thain was criticised for a lavish office renovation that included a $35,000 "commode on legs”.

"Greg having lived through the John Thain era I think that continues to be paramount in everybody's mind," said one bank executive close to Fleming. 

Fleming declined to comment.

Still, cutting some of the flashier perks can be more symbolic than anything. Overall executive compensation continued to rise in 2013, though at a slower pace than in previous years, according to a review of early filings. 

Wynn, for example, made $19.6 million in compensation in 2013, up from $17.7 million in 2012. 

Mundane spending up

Indeed, about 60 per cent of companies that have filed disclosures for 2013 actually raised "other compensation" spending, according to compensation data firm Equilar. The trend follows the pattern of past years and may reflect more spending on areas like security and financial planning.

Towers Watson's survey last year found the median value of financial and tax planning assistance for CEOs rose to $15,000 in 2012 from $11,180 in 2007, for instance. 

And not everyone is booking less personal travel to their companies.

At Verizon Communications Inc. CEO Lowell McAdam got a 46 per cent boost in "other compensation" to $780,874 in 2013. Of that $120,304 was for personal use of company aircraft, up from $89,467 in 2012. Verizon declined to comment.

Nutrition and weight-loss company Herbalife also sharply boosted spending on personal jet use by its CEO Michael Johnson and his family. A company spokesman said the use of a private jet was for the family's personal security. 

Johnson and Herbalife have been under a lot of pressure from hedge fund manager William Ackman, who has had a big short bet against the company's shares and has accused it publicly of running a pyramid scheme. Herbalife strenuously denies the charge.

Another perk is the chance to use a company's products.

General Electric Co. described a programme that provides its home appliances "upon request" to top executives and directors. Rival Whirlpool Corp's filing outlined a similar deal for its directors who aren't executives. 

"For evaluative purposes, Whirlpool permits non-employee directors to test Whirlpool products for home use," the company said in a filing.

Also, California chipmaker Advanced Micro Devices Inc.  listed as gifts to its top executives the costs of Sony PlayStation 4 and Microsoft Xbox One game consol systems — with $1,006 worth logged to CEO Rory Read. 

Both systems use AMD components. Hundreds of other company employees also received game consoles "to acknowledge their contributions driving our strong financial performance," AMD spokesman Drew Prairie said via e-mail.

AMMAN — Aqaba Special Economic Zone Authority (ASEZA) announced in  a press statement on Thursday that it sponsored the Global Trade Development Week, APAC 2014 held in Kuala Lumpur, Malaysia last week with the aim of attracting  foreign investments and highlighting Aqaba's competitiveness.

ASEZA Chief Commissioner Kamel Mahadin briefed participants on Aqaba’s competitive investment climate and highlighted the port city's vision, achievements and opportunities.

“ASEZA is determined to market Aqaba in the Far East,” the statement quoted Mahadin as saying, noting that such move falls within His Majesty King Abdullah's drive to promote Jordan and Aqaba as investment destination.

He underlined the success Aqaba’s success as it attracting over $20 billion of investments. On the sidelines of the event, Mahadin discussed with Fahad Al Kaabi, chief executive officer of Manateq, a Qatari-based  Economic Zones Company, means to develop mutual cooperation and exchange of knowledge and know-how.

ASEZA head extended an invitation to the Qatari delegation to visit Aqaba and explore investment opportunities.

The Jordanian delegation agreed with their counterparts from the Iskandar Economic Zone Authority in Malaysia, to develop their cooperation and to facilitate transporation of Malaysian pilgrims to Mecca in Saudi Arabia via Aqaba. 

LONDON — Global private equity firm KKR  has bought $150 million worth of shipping loans from two European banks amid a surge of interest in the industry as world trade in goods picks up along with the global economy.

There have been a flurry of deals in recent months for ship finance loans, many of which are being put up for sale by banks under pressure to boost their capital in order to adhere to new, stricter industry legislation born of the financial crisis.

The banks have suffered alongside the shipping firms they lent to, as the latter endured one of their worst downturns in decades. Many firms defaulted on loans and several collapsed. As a result, the banks are offloading what they see as risky assets at cheap prices, even as trading conditions improve.

KKR picked up loans taken out by Indonesian oil and gas shipping group PT Berlian Laju Tanker that were sold by Sweden's Nordea Bank and France's BNP Paribas, trade finance sources with knowledge of the matter said.

KKR, Nordea Bank and BNP Paribas all declined to comment, while Berlian Laju did not respond to requests for comment. 

Pricing on the deal was in the region of 70 per cent of the value of the loans, the sources said.

A survey by accountancy and advisory firm Moore Stephens last week showed shipping confidence in February reached its highest level since 2008, while respondents indicated growing interest from private equity investors.

"Through buying shipping loans at a discount, investors are entering at a lower threshold. The freight market right now is okay, so companies will likely be able to service loans, thus funds make their 5 per cent, which is a nice carrying yield," one trade finance source said.

"If market goes up, their loans will appreciate, thus there will be additional benefit and return. If the market goes to hell or they think they can find a better management team, then they just take over the vessels and become shareholders and own the business,"  he added. 

KKR said in August it had formed a specialty finance company to lend to the maritime industry that would "originate, structure, underwrite, invest in and distribute debt financings secured by high-quality maritime assets". Maritime Finance would be capitalised with $580 million of equity, KKR said then.

Berlian Laju, which narrowly escaped bankruptcy last year, said in January it had cut its fleet size by 44 per cent and would transfer a stake in subsidiary PT Buana Listya Tama to one of its creditors Deutsche Bank. 

The shipping firm, which had struggled with weak freight rates and escalating fuel costs, reached a deal with creditors in March last year to restructure its $1.9 billion debt. 

Thomson Reuters LPC data showed Berlian Laju unit Gold Bridge Shipping Corp. took out a $685 million syndicated loan in 2011 in which Berlian Laju was an additional borrower on the facility. Lenders included Nordea Bank and BNP Paribas. 

Lloyds sale

Trade finance and banking sources said separately that Lloyds Banking Group had received multiple expressions of interest for a $500 million tranche of shipping loans and was reviewing the offers.

Lloyds declined to comment.

One trade source with knowledge of the matter said KKR was among those interested in the sale. KKR declined to comment.

"Every man and his dog is looking at this portfolio, it's very competitive," one banking source remarked.

Other contenders included Citigroup and Bank of America as well as private equity group Apollo Global Management and asset manager Oaktree Capital Management, trade finance sources noted.

Citi, Bank of America, Oaktree and Apollo all declined to comment.

The sale is likely to be the final large divestment of loans from Lloyds' ship finance portfolio which was worth around £7 billion ($11.64 billion) at its peak.

Lloyds' British rival Royal Bank of Scotland (RBS) and Germany's Commerzbank CBKG.DE and HSH are also selling shipping loans to investors including private equity funds in order to strengthen their balance sheets and divest assets that have hurt them during the market downturn.

RBS said in February impairments on its shipping loans soared to 341 million last year, of which £310 million was in the fourth quarter. Its shipping assets were worth £6.5 billion at the end of 2013, down from 7.6 billion a year earlier, RBS said.

AMMAN — The ready-made clothing industry topped the list of  exports in terms of value in 2013, marking a 10 per cent increase compared with the previous year, according to the Department of Statistics. In a statement, the department noted that JD810 million was generated in the exports of clothes last year, compared with JD737 million in 2012. Dina Fakhouri, president of the Jordanian Society for the Export of Clothes and Textiles, said the "high" quality and "competitive" prices of national-made clothes have contributed to boosting the sector, which she noted provides more than 40,000 job opportunities and supports other industries. Fakhouri indicated that the exports of clothes have increased to North America, noting that the added value of the Kingdom's clothing sector stands at 37 per cent

AMMAN –– Awni Rushoud, Jordan Investment Board’s (JIB) acting chief executive officer, on Wednesday briefed a delegation from the Australia Arab Chamber of Commerce and Industry (AACCI) on investment opportunities in Jordan, particularly in the fields of medical services, tourism and food processing. According to a JIB statement, Rushoud said Jordan’s strategic location, security and stability as well as business legislation are key investment attractions. He also highlighted that human resources in Jordan are considered among the most qualified in the region. The statement said JIB and AACCI will sign a memorandum of understanding to boost economic and business ties that aim to attract investments from Australia. The delegation was headed by Geoff Puttick, the chamber’s chairman and AACCI Director Ayed Wahab, the statement added. 

SINGAPORE — The Asia-Pacific will overtake Europe as the region whose tourists spend the most money overseas within 10 years, a report said Wednesday, driven by an explosion in the number of Chinese travellers.

Spending by tourists from the Asia-Pacific will reach nearly $753 billion by 2023, increasing the region's share of global spend to 40 per cent from 25 per cent in 2012, according to a report commissioned by travel technology firm Amadeus.

Travellers from Europe will account for 34 per cent of global outbound spend by the same year, down from 45 per cent in 2012, the report indicated.

"The findings underscore what most of us already intuitively know — that we have now truly arrived in the Asian century," Amadeus Asia Pacific President Angel Gallego said in a statement.

"No matter where we look, Asian travellers have and will continue to change the landscape of travel, and business must adapt to them or risk falling behind," he added.

In January, the state-run China Daily said Chinese travellers spent $102 billion overseas in 2012, making them the world's biggest spenders ahead of German and US tourists.

They are almost certain to have surpassed that record last year, noted the report.

Visitor flows from Asia over the next decade is forecast to grow at an annual average rate of 15 per cent — nearly double the preceding 10-year period and faster than any other region, said the report written for Amadeus by forecasting firm Oxford Economics.

Driving this expansion is the explosive growth in the number of travellers from China, the report showed.

The Asian economic powerhouse is set to surpass the United States this year as the world's largest source of outbound travellers and is poised to become the biggest domestic travel market globally by 2017, it said.

China's share of global outbound travel is projected to reach 20 per cent by 2023 — up from just 1 per cent in 2005.

China's economy has boomed over the past decade, expanding the ranks of its middle-class who are hungry for foreign travel after the country's decades of isolation in the last century.

European Union and Asian countries have moved to ease visa application procedures for Chinese tourists in recent years, keen to cash in on their big-spending habits.

The report also predicted that global travel would expand 5.4 per cent per year in the next decade, faster than the projected growth of 3.4 per cent for world gross domestic product in the same period.

Business travel, which was hit by the global financial crisis that started in late 2008, is also expected to bounce back.

Asia will account for 55 per cent of global business travel growth during the forecast period, the report indicated.