Jordan has one of the smallest economies in the Middle East, and its lack of natural resources and water scarcity make it heavily dependent on foreign aid and foreign investment. Following the global financial crisis of 2008 growth slowed significantly; the deteriorating regional situation since 2011 and subsequent mass influx of Syrian refugees has made recovery difficult, though marginal increases in growth are predicted in coming years. Growth is also hampered by underlying structural issues which need to be addressed, notably unsustainable expenditure on subsidies and high levels of public debt. The government is committed to reform and has taken a number of steps in this regard, but it is constrained by the need to maintain public support, particularly among its traditional Transjordanian (Jordan’s ‘original’ population) support base. Looking ahead, Jordan faces significant challenges, particularly in relation to hosting a vast Syrian refugee population, and the risks of on-going/heightened regional instability and conflict. However, there is also potential for strengthened economic growth, particularly if the requisite reforms are implemented.
K4D helpdesk reports provide summaries of current research, evidence and lessons learned. This report was commissioned by the UK Department for International Development
Idris, I. (2016). Economic Situation in Jordan. K4D Helpdesk Research Report. Brighton, UK: Institute of Development Studies
Published 28 November 2016