Jordan has launched a drive to reform the national economy and recover from the effects of the Coronavirus pandemic which took its toll on all walks of life. Through a comprehensive and time-bound reform program, the government has sought to boost growth and revitalize the Kingdom’s business ecosystem. This has been devised to directly benefit citizens through robust growth.
The ongoing reform effort has the support of King Abdullah II, who recently stressed in a public speech the need for accelerated economic growth, revitalized public and private sectors, and to combat poverty and unemployment. Jordan’s reform drive is aided by a variety of factors, including its strategic geographic location, security and stability, as well as industries that maintain a foothold in 140 markets.
There are major obstacles slowing the Kingdom’s growth, including a turbulent neighborhood, the ramifications of the pandemic, and the burden of hosting about 1.3 million Syrian refugees. As a result of these problems, the Kingdom’s economic growth slowed to 2.4 percent in 2010-2019, down from 6.5 percent in 2000-2009.
Due to sluggish growth, low foreign capital inflows, and higher production costs, unemployment reached record levels of 25 percent in early 2021. With this reality in mind, Jordanian decision makers deemed it imperative, more than ever before, to ramp up reform efforts to bring the economy back on track, generate jobs and lure in foreign investments of added value.
Recently, the Jordanian government announced a major restructuring of customs and electricity rates in an attempt to boost the national economy’s competitiveness, reduce business costs, and increase the purchasing power of citizens. In addition, the government plans to start laying the groundwork for 5G deployment. Jordan views ICT as a bulwark of its economy, and aspires to become a regional technology hub.
New investment laws will be drafted in coordination with the private sector to spur new capital into the Kingdom and reduce red tape. A one-stop shop will be established, thereby reducing costs and efforts associated with doing business.
Nevertheless, some private sector businessmen are convinced that economic reform cannot be successful without an administrative reform that reduces bureaucracy, re-engineers government services, and eliminates obstacles to business.