I recently interviewed Samer Almadhoun who discussed the supply chain implications of Jordan joining the GCC. Samer is Jordanian who has been in the supply chain field roughly 15 years. His professional education was earned from international professional institutes such as APICS and The Chartered Institute of Logistics & Transport (UK). Samer has also acted as a consultant and instructor on a part-time basis, while also maintaining his full-time job in the supply chain field.
Supply chain implications of Jordan joining the GCC
The GCC is the Gulf Cooperation Council. It is a political and economic union of the Arab state constituting the Arabian Peninsula, namely Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE. In 2011 there was a request by Jordan to join the GCC, which is currently being formally considered.
This area has some of the fastest growing economies in the world, mostly due to the boom in oil and natural gas. This is coupled by the building and investment boom backed by the decades of saving petroleum revenues.
The GCC was formed in 1981 with the objective of formalizing and formulating similar regulations in various fields such as economy, finance, trade, Customs, legalization and administration. A common currency similar to the EURO was also established. It also unified a military presence as the peninsula chief force. The current proposed currency is called Khaleeji.
If the GCC monetary union is realized it would be the second most important super national monetary union in the world after the EURO area.
Jordon requested to join the GCC in 2011 and has been welcomed. Despite the fact that Jordan has no coastline and the differences in tribal societies between the GCC and Jordan, it does have a military expertise. Jordan can provide military assistance to combat political reform. This is one of the many assumptions to explain why the GCC would welcome Jordan. Samer believes it has much to do with the political situation of the revolutionary Arabian States.
When it comes to supply chain, joining the GCC would have its impact. Jordan heavy relies on Customs as a form of international income for the country. Joining the GCC will change the formula. In addition, the smooth trade Jordan will enjoy with the GCC Union will definitely re-shape the Jordanian supply chain.
The port of Aqaba as a regional hub will increase. The transportation in Jordan in general will be different. Samer believes there will be a huge impact on trade between countries and the GCC. According to the Jordanian professionals in the supply chain field, they have a lot to do over the next few years. It will open new markets for new products and there will be more visibility created with Jordanian suppliers and their global supply chain partners. It will also smooth the movement of labor from one country to another, basically from Jordan to the GCC.
Samer believes there will be a huge impact on the Jordanian supply chain after it joins the GCC.
Recommendations for global supply chain managers
It is naïve and unprofessional to believe that local policies and procedures are applicable abroad. The differences in culture between countries make it important for regional supply chain managers to understand the culture. Each country has its own culture, procedures, etc. There should be an understanding of political and economic situation of any country in order to get it right with that country.
About Samer Almadhoun
Samer (M) Almadhoun MBA,CPM
Supply Chain Manager at MMSD