Amman, Jordan – Over 70 percent of Jordanian entrepreneurs and companies would consider transferring their headquarters or operations — or both — abroad, and 12 percent already have, according the Jordan Business Migration Survey conducted by Endeavor Jordan in November 2016.
Endeavor Jordan surveyed a sample of 125 companies of varying sizes and across different sectors, and published an infographic of their findings, which sought to show why entrepreneurs leading locally-established companies are relocating. One of the key reasons entrepreneurs contemplate relocating is their need to access larger markets, a motive that was shared by 74% of the respondents. Some of the other major challenges cited by the companies include high taxations, regulatory instability, limited access to funding, and rigid capital controls.
“We asked entrepreneurs: ‘If you were to start your business all over again, would you set it up in Jordan?’ Astonishingly, 60% of respondents said they would not,” said Rasha Manna, Managing Director of Endeavor Jordan. “We are constantly on the lookout for high-impact entrepreneurs to add to our pipeline – those who lead high-growth, innovative businesses that can create material wealth and employment in Jordan. We find this search to be quite challenging as many company founders of this required caliber have already relocated, or are seriously considering relocating to markets they perceive as more favorable.”
Of those surveyed, 72 percent indicated that they were considering moving their business abroad. The results of the survey also showed that 45 percent of this group would consider moving not just their headquarters, but their entire operations as well. Moreover, only 15 percent of respondents from the technology sector – which comprised almost half of the surveyed companies – said they were not considering relocation.
A closer look at what is keeping businesses in the Kingdom revealed ‘Jordan is home’ as the primary reason. Only one-third considered Jordan a good testing ground for their business, and approximately one-quarter of respondents – mainly from the technology and financial services sectors – said that the low cost of human capital was among the reasons they chose to remain in Jordan. Additionally, one-quarter of respondents said it was their knowledge of the market that kept them in the country.
“As prices in Jordan soar and the brain drain of Jordan’s smartest and most talented and entrepreneurial people continues, the country is swiftly losing what has long been considered its competitive advantage,” stated Manna. “Through this survey, we also uncovered the respondents’ lack of confidence in any short-term reversal of the unfavorable economic and entrepreneurial situation in Jordan. The survey revealed that over 36 percent think it will take over five years for economic conditions in Jordan to improve, and 27 percent think it will need over ten years.”
Manna added, “Any rectification of the local entrepreneurial ecosystem requires the support, collective efforts and long-term commitment of all relevant stakeholders from the public and private sectors backed by a cohesive government strategy that develops a consistent policy framework. Only then can we increase the confidence and ability of entrepreneurs and investors to grow companies in Jordan.”
Endeavor Jordan presented the findings at a “Catalyzing Conversations” event on January 31, attended by representatives from different sectors from public and private entities, who participated in an interactive conversation to explore possible solutions to tackle the outflux of talent. An overview of the survey’s results are also featured in the video below.