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Jordan tech sector taking off

It's no Silicon Valley, but in the Arab world the desert kingdom has become something of a techie's mecca.

A Jordanian woman, Nessma, looks at the Talasim website at an office in Amman, Sept. 30, 2009. The Arabic website was awarded the top prize at the international SeedCamp competition for start-up companies out of 1,500 contenders. (Ali Jarekji/Reuters)

AMMAN, Jordan — This summer, Jordan’s IT sector took many outsiders by surprise with the announcement that Yahoo! had purchased, a local company that provides Arabic email and other online services. While the terms of the deal have not been disclosed, it represents one of the most high-profile IT success stories in the Arab world.

Within Jordan, the founders of have become something of national heroes. Earlier this month, King Abdullah II awarded the company’s founders, Samih Toukan and Hussam Khoury, with the Hussein Medal for Distinguished Performance of the First Order. King Abdullah, who has long lobbied for Jordan to develop its tech sector, went on to praise the deal as a reflection of his country’s blossoming IT industry and said he hoped it would continue to grow.

Though Jordan is still a long way from becoming the Silicon Valley of the Middle East, it’s steadily on its way to becoming a central hub for Arab IT entrepreneurship. The country’s supportive and permissive government has helped make it an attractive place to do business. Also without oil or other natural resources, Jordanians have been forced more than their neighbors to develop intellectual industries.

There remain, however, many challenges to further developing the nation’s IT sector.

Arab investors tend to avoid the IT sector, preferring more stable options, such as real estate development. Additionally, with some of the most lucrative IT jobs outside Jordan, the country has to plug the brain drain.

Those in the IT sector are hoping the deal will encourage investors to consider more seriously local technology companies as a sound investment opportunity.

Following his meeting with the King, Toukan went on Jordanian TV to emphasize the possibilities for Jordanian entrepreneurs. “The agreement signed with Yahoo! underlines Jordan’s ability to compete with global megacompanies operating in the sector,” he said.

Indeed, the IT sector has come to play an increasingly significant role in Jordan, comprising 12 percent of the country’s GDP. A national initiative started in 2007 has been working to double the size of the IT sector by 2011. Additionally, independent growth here is strong, with only the United Arab Emirates listing more startups than Jordan on StartupArabia, a website dedicated to tracking Arab technology companies.

When Ahmad Humeid and George Akra founded Ikbis, an Arabic photo and video sharing website three years ago, they were among the first Arab web 2.0 startups and a handful of Jordanian Internet companies. Back then, the local online entrepreneur community was small enough that everyone knew one another, but now it’s grown large enough that the Humeid and Akra say they have a hard time keeping track of all the new ventures.

“If you want to compare it to the rest of the Arab world, [Jordan] has definitely created a niche for itself in this field of basically being the country where there are a remarkable number of startups,” says Humeid, who also holds the distinction of having produced the first Arabic podcast.