Terrorism, cheap freight threaten Jordan's trucking industry

| 9/20/2004

The recent hostage taking and threats against Jordanian truck drivers entering Iraq is severely damaging the country’s trucking and distribution sector with some analysts estimating thousands of people’s livelihoods are at risk, according to a report by the Jordan Times.

“Jordanian truck drivers are restricted to charging certain prices by the Ministry of Transport and are fined if they undercut or overcharge. Iraqi truck drivers have no such restraints at the moment, so even if Jordanians wanted to make the drive to Baghdad, they wouldn't be able to compete,” said Marwan Bitar, chairman of Amman Swards Transport Service and manager of one Jordanian trucking company.

Bitar said he recently wanted to transport 100,000 tons of fertilizer to Iraq. While Jordanian drivers must charge $28 per ton, Iraqi drivers would take the load for $19, Bitar said.

Moreover, Iraqi truck drivers’ lack of overhead also helps them undercut their Jordanian counterparts.

“I have been told by Iraqi officials that most of the truckers are driving stolen vehicles,” Bitar said “They had been working for the state-owned company, and when the government fell they simply took their trucks home. Nothing has been done to get them back and they now have a stranglehold on the market.”

While essential supplies still make it into Iraq, many companies hold off shipping any items that are not urgently required.

“There is no insurance available and we can make absolutely no guarantee that deliveries will arrive. We are relying entirely on the drivers who could be risking their lives. It’s not a situation that we’re at all happy with,” said Ibrahim Naouri, managing director of shipper Naouri Group. “We're only using Iraqi drivers now, because they will make the trip and because they are around $100 cheaper per truck.”

Meanwhile, exporters are reluctant to ship U.S.-bound loads, citing the increased risk of attack.