Global Integrity’s Suha Ma’ayeh breaks down the history of the mobile communications market in Jordan — and the rich opportunities that were created by privatizing a national telecom with limited public oversight.
Call Your Wasta
By Suha Philip Ma’ayeh
In 2005 Umniah Mobile Communications (UMC) entered the Jordan’s booming telecommunications sector. It became the country’s third mobile operator and broke the market’s duopoly, ushering in lower tariffs in a country where mobile phone usage stands at 47.9 percent. But when UMC was sold in 2006 to a Bahraini company for US$415 million — a much inflated price compared with its initial 8 million dinar (US$11.3 million) license fee — questions arose over the licensing procedure.
Lawmakers investigated the deal for corruption, believing that there were officials who benefited from the sale. However, corruption is easy to allege and hard to prove.
Lawmakers received unconvincing answers from the government when they asked it to clarify the huge difference between the license fee and the selling price of the company. In March 2007, Parliament asked the general prosecutor to investigate the case. In August, King Abdullah of Jordan dissolved Parliament.
A leaked government report into the allegations found that the deal was in accordance with the law. However, the lawmakers and commentators saw the report as an attempt by the government to influence the judiciary’s investigation. Former lawmaker Mamdouh Abbadi, who headed the Anti-Corruption Committee at the lower house of Parliament, said, “this is unconstitutional because when the court is looking into the case, no single institution — not even Parliament — is allowed to carry out investigations.”
Successive governments in Jordan have vowed for years to fight corruption, but many Jordanians share the feeling that the disclosed corruption cases are just the tip of the iceberg. According to officials, administrative corruption outweighs financial corruption. One official described the office of the prime minister as a dumping ground for high-level government employees who are no longer needed in their previous posts. They are appointed as advisers without job descriptions.
Advisers’ salaries are at least 1,000 dinars a month (US$1,412), in a country where the annual per capita income stands at 1,082 dinars (US$1,528).
A poll conducted by the Center for Strategic Studies at the University of Jordan in 2006 surveyed a random sample of 1,148 people and another of 626 opinion leaders. The study reavealed that 46 percent of Jordanians said they believe corruption has increased during the last three to four years. Some 65 percent of respondents said they believed that corrupt practices such as bribery, embezzlement, fraud, extortion, favoritism and nepotism exist to varying degrees in the public sector, while 52 percent said they believed that corruption was widespread in the private sector.
But if anything serves as the symbol of corruption in Jordan, it is what is known as Wasta. Wasta literally means favoritism — the use of family, business or personal connections to advance personal interests. Although Wasta is culturally rooted, the vast majority of Jordanians believe that it is a prevalent form of corruption. At the same time, there is a public perception that citizens must have some sort of Wasta in order to run their day-to-day affairs smoothly, in a country largely ruled by bureaucracy.
For example, if you have an acquaintance at the Department of Civil Service who could act as your Wasta, he could simply help you skip the line to renew your passport or ID. Not only that, your Wasta can help you get appointed at a governmental institution, avoiding the ranks of the unemployed in Jordan. Currently, 15.4 to 30 percent of the country’s 5.6 million are jobless. Such was the case for the son of an influential member of Parliament. The son became the director of one of the Jordanian government’s business development institutions in September 2006. Needless to say, the son of this MP didn’t have to prove himself or his credentials to obtain this position.
An Anti-Corruption Commission Law endorsed by Parliament in September 2006 defined corruption as any act that violates official duties and all acts related to Wasta and nepotism that could deprive others of their rights, as well as economic crimes and misuse of power. Alghad, a private newspaper, played on the theme to attract readers by running ads that featured a serious middle-aged businessman clad in a suit, with a sentence that read, “In Jordan, there is no Wasta.”
Journalists themselves are not immune from corruption, which is also encouraged by officials. At least a handful of journalists were appointed as media advisers in several ministries, where they draw a salary while remaining on their papers’ payroll. “These advisers try to influence their colleagues to overlook certain stories, or avoid criticizing a certain minister,” said Fahed Kheitan, an editor at Arab Alyawm, a daily newspaper in Amman.
Such self-censoring is the reason why a story about the Amman Municipality expropriating the corporate buildings of businessman Talal Abu-Ghazaleh to serve the interests of regional investors was absent from the leading newspapers in which the government is a strong shareholder. Abu-Ghazaleh has since spent millions to fight the order, and he took the municipality to court. Economists and lawmakers spoke out about the abuse of power and illegal expropriation. They charge that the US$1.5 billion project is a private investment, so expropriating the buildings does not serve the public interest. However, the expropriation could not be proven illegal either.
Like members of the press, judges are often subject to undue interventions and pressures, leaving the judiciary open to corruption and abuse of power. Since June 2006, the judiciary has been looking into seven cases of alleged corruption.
One such case implicated a former minister of municipalities, Abdul Razzak Tubeishat, who was charged for allegedly sanctioning the purchase of waste-management vehicles from Germany for an estimated 4.5 million dinars (US$6.3 million).The required specifications for the equipment were not met, but the purchase was approved anyway. Tubeishat was a serving minister when the alleged practice took place, so he could not be tried in a regular court. In December 2006, a special parliamentary committee formed to investigate the allegations later acquitted the former minister from any wrong doing. However, a parliamentary session designed to discuss the committee’s decision did not muster the needed quorum and accordingly was canceled. So when parliament was dissolved, Tubeishat’s case remained unresolved.
With the exception of a former chief of intelligence who was tried under house arrest in 2002, rarely are high-ranking official charged in Jordan.
Other cases the courts are looking into involve alleged financial violations by the Islamic Center Charity Society and suspicious accounting procedures by the General Union for Voluntary Societies.
In compliance with the UN Convention Against Corruption, Jordan has created an anti-corruption committee whose members were appointed on March 19, 2007. The committee’s president, Abed Shekhanbeh, said he will concentrate on investigating the misuse of public funds, among other things, and will ensure that ministers and lawmakers are charged if there are witnesses and sufficient evidence.
Parliament also passed a Financial Disclosure Law in November 2006 and an Access to Information Law in April 2007. However, access to information remains hindered by State Secret and Documents Law (Provisional Law No. 50 of 1971), which violates internationally recognized principles of access to information. To combat corruption effectively, the country needs free media, a Parliament that is not based on tribal affiliations, and a strong judicial system. This is not the case in Jordan.
Jordan’s only TV station is under state control. A new, private TV station was scheduled to start broadcasting in July 2007 but has been put on hold due to financial irregularities. Additionally, with parliamentary elections scheduled for November 2007, the government is waging a campaign against the Islamic Action Front — with 17 seats, the only opposition in Parliament. The rest of the 34 political parties are fragmented and weak.
Corruption is like cancer, and Jordan needs to eliminate the causes that lead to cancer before it starts fighting the disease itself.
“Even if there are serious efforts to combat corruption, there are limits,” said Abdul Rahim Malhas, a former member of Parliament and health minister who was vocal against corruption. “You can find corruption, but you cannot fight those who are corrupt because they are powerful.”
