Qualifying Industrial Zone

Qualifying Industrial Zone

Qualifying Industrial Zones (QIZ) are industrial parks that house manufacturing operations in Jordan and Egypt. They are a special free trade zones established in collaboration with neighboring Israel to take advantage of the free trade agreements between the United States and Israel. Under the trade agreements with Jordan as laid down by the United States, goods produced in QIZ-notified areas can directly access US markets without tariff or quota restrictions, subject to certain conditions. To qualify, goods produced in these zones must contain a small portion of Israeli input. In addition, a minimum 35% value to the goods must be added to the finished product.

The brainchild of Jordanian businessman Omar Salah, the first QIZ was authorized by the United States Congress in 1997. The Al-Hassan Industrial Estate in Irbid in northern Jordan was designated as the world's first QIZ under the agreement. Since 1998, several other QIZ locations have been set up in Jordan, and later in Egypt. The idea behind the establishment of QIZs was to foster a sense of prosperity and stability in Middle East through economic cooperation and employment.

Qualifying Industrial Zones differ from other trade zones as they are stand-alone entities within one country and not directly connected to other countries. In addition, QIZ products are for exports and domestic consumption in any country, not limited to specific countries, and most importantly operate only under the authority and conditions laid down by the host government.

As of January 2009, there are five Qualifying Industrial Zones in Jordan and four QIZ designated regions in Egypt.