Jordan Economic Monitor, Spring 2016 : The Challenge Ahead
Amidst a turbulent regional political and security environment, Jordan wrestles with sluggish growth and high unemployment. A number of risks materialized in 2015, particularly related to security spillovers and their negative impact on tourism, co...
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| Format: | Report |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2016
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| Online Access: | http://documents.worldbank.org/curated/en/2016/07/26583291/jordan-economic-monitor-challenge-ahead-executive-summary http://hdl.handle.net/10986/24942 |
| Summary: | Amidst a turbulent regional political
and security environment, Jordan wrestles with sluggish
growth and high unemployment. A number of risks materialized
in 2015, particularly related to security spillovers and
their negative impact on tourism, construction, investment
and exports. As such, the economy slowed down for the first
time since 2010, further widening Jordan’s output gap, with
growth declining from 3.1 percent in 2014 to 2.4 percent for
2015. However, growth remained otherwise broad-based. The
largest contributions to growth came from ‘finance and
insurance services’, ‘transport, storage and
communications’, ‘producers of government services’,
‘electricity and water’ and manufacturing sectors although
it was ‘mining and quarrying’ and ‘electricity and water’
that saw the highest growth rates in 2015. Unemployment
reached an average of 13.0 percent in 2015, 1.1 percentage
points wider compared to 2014. Growth is projected to
rebound slightly, to an average of 3.3 percent over
2016-2018, provided no further spillovers from the Syrian
crisis occur. Chiefly, Jordan will need to continue managing
repercussions from the regional security and political
situation, and the challenges of hosting 1.37 million
Syrians (of which 639,704 registered refugees).
Additionally, since Jordan benefits from the GCC for
remittances, exports, FDI and grants, large sources of
foreign exchange - persistently low oil prices are a risk
for Jordan this year and in the medium term. Weak global
demand may impact demand for Jordan’s mining exports.
Furthermore, the willingness and speed of reform
implementation particularly to improve the business climate
will be crucial to attract Jordan’s investment aspirations. |
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