Economy of Jordan

Economy of Jordan
New Abdali in Amman
CurrencyJordanian dinar (JOD)
Calendar Year
Trade organisations
WTO, CAEU, G77
Country group
  • Lower-middle income country[1]
Statistics
GDP
  • Increase $53.57 billion (nominal, 2024 est.)[2]
  • Increase $141.191 billion (PPP, 2024 est.)[2]
GDP rank
GDP growth
  • 2.4% (2022) 2.6% (2023e)
  • 2.6% (2024f) 3.0% (2025f)
GDP per capita
  • Increase $4,705 (nominal, 2024 est.)[2]
  • Increase $12,402 (PPP, 2024 est.)[2]
GDP per capita rank
GDP by sector
4.224% (2022)[2]
Population below poverty line
35.4 medium (2013)[6]
Labour force
  • Increase 2,631,115 (2019)[9]
  • Decrease 32.1% employment rate (2014)[10]
Labour force by occupation
Unemployment
  • Negative increase 18.3% (2017 est.)[3]
  • note: official rate; unofficial rate is approximately 30%
Main industries
tourism, information technology, clothing, fertilizer, potash, phosphate mining, pharmaceuticals, petroleum refining, cement, inorganic chemicals, light manufacturing
External
ExportsIncrease $15.9 billion (2022 est.)[11]
Export goods
textiles, fertilizers, potash, phosphates, vegetables, pharmaceuticals
Main export partners
ImportsIncrease $31.5 billion (2022 est.)[11]
Import goods
crude oil, refined petroleum products, machinery, transport equipment, iron, cereals
Main import partners
FDI stock
  • Increase $33.83 billion (31 December 2017 est.)[3]
  • Increase Abroad: $646.5 million (31 December 2017 est.)[3]
Decrease −$4.257 billion (2017 est.)[3]
Negative increase $29.34 billion (31 December 2017 est.)[3]
Public finances
Negative increase 95.9% of GDP (2017 est.)[3][notes 1]
−5.1% (of GDP) (2017 est.)[3]
Revenues9.462 billion (2017 est.)[3]
Expenses11.51 billion (2017 est.)[3]
Increase $15.56 billion (31 December 2017 est.)[3]
All values, unless otherwise stated, are in US dollars.
Part of a series on
Flag of Jordan Jordan
Geography
History
Pre-modern history
Hashemite rule
Economy
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Communications

The economy of Jordan is classified as a lower middle income economy.[1] Jordan's GDP per capita rose by 351% in the 1970s, declined 30% in the 1980s, and rose 36% in the 1990s.[15] After King Abdullah II's accession to the throne in 1999, liberal economic policies were introduced. Jordan's economy had been growing at an annual rate of 8% between 1999 and 2008. However, growth has slowed to 2% after the Arab Spring in 2011. The substantial increase of the population, coupled with slowed economic growth and rising public debt led to a worsening of poverty and unemployment in the country. As of 2023, Jordan has a GDP of US$50.85 billion, ranking it 89th worldwide.[16]

Jordan has free trade agreements with the United States, Canada, Singapore, Malaysia, the European Union, Tunisia, Algeria, Libya, Turkey[17] and Syria. More free trade agreements are planned with Iraq, the Palestinian Authority, the GCC, Lebanon, and Pakistan. Jordan is a member of the Greater Arab Free Trade Agreement, the Euro-Mediterranean free trade area, the Agadir Agreement, and also enjoys advanced status with the EU.[18]

Jordan's economic resource base centers on phosphates, potash, and their fertilizer derivatives; tourism; overseas remittances; and foreign aid. These are its principal sources of hard currency earnings. Lacking coal reserves, hydroelectric power, large tracts of forest or commercially viable oil deposits, Jordan relies on natural gas for 93% of its domestic energy needs. Jordan used to depend on Iraq for oil until the American-led 2003 invasion of Iraq. Jordan also has a plethora of industrial zones producing goods in the textile, aerospace, defense, ICT, pharmaceutical, and cosmetic sectors. Jordan is an emerging knowledge economy.

The main obstacles to Jordan's economy are scarce water supplies, complete reliance on oil imports for energy, and regional instability. Just over 10% of its land is arable and the water supply is limited. Rainfall is low and highly variable, and much of Jordan's available ground water is not renewable.

In the last few years Jordan's economic growth has slowed, averaging around 2%. Jordan's total foreign debt in 2011 was $19 billion, representing 60% of its GDP. In 2016, the debt reached $35.1 billion representing 93.4% of its GDP.[19] This substantial increase is attributed to effects of regional instability causing: decrease in tourist activity; decreased foreign investments; increased military expenditure; attacks on Egyptian pipeline supplying the Kingdom with gas; the collapse of trade with Iraq and Syria; expenses from hosting Syrian refugees and accumulated interests from loans.[19] According to the World Bank, Syrian refugees have cost Jordan more than $2.5 billion a year, amounting to 6% of the GDP and 25% of the government's annual revenue.[20] With the presence of Syrian refugees in Jordan, wage growth went considerably down as a result of competition for jobs between refugees and Jordan citizens. The downturn that began in 2011, continued until 2018. The country's top five contributing sectors to GDP, government services, finance, manufacturing, transport, and tourism and hospitality were badly impacted by the Syrian civil war.[21] Foreign aid covers only a small part of these costs, 63% of the total costs are covered by Jordan.[22] An austerity programme was adopted by the government which aims to reduce Jordan's debt-to-GDP ratio to 77% by 2021.[23] The programme succeeded in preventing the debt from rising above 95% in 2018.[24] The yearly growth rate of the economy was 2% from 2016 to 2019, compared to 6.4% from 2000 to 2009.[25]

  1. ^ a b "World Bank Country and Lending Groups". Retrieved 11 October 2024.
  2. ^ a b c d e "World Economic Outlook Database, April 2024". IMF.org. International Monetary Fund. Archived from the original on 2 May 2024. Retrieved 3 May 2024.
  3. ^ a b c d e f g h i j k l "The World Factbook". CIA.gov. Central Intelligence Agency. Archived from the original on 3 June 2021. Retrieved 17 February 2019.
  4. ^ "Poverty headcount ratio at national poverty lines (% of population)". data.worldbank.org. World Bank. Archived from the original on 18 February 2019. Retrieved 17 February 2019.
  5. ^ "Poverty headcount ratio at $5.50 a day (2011 PPP) (% of population) - Jordan". data.worldbank.org. World Bank. Archived from the original on 4 November 2019. Retrieved 3 November 2019.
  6. ^ "Income Gini coefficient - Human Development Reports". UNDP. Archived from the original on 2 July 2015. Retrieved 25 May 2018.
  7. ^ Nations, United (March 2024). "Human Development Insights". hdr.undp.org. United Nations Development Programme. Archived from the original on 18 November 2018. Retrieved 25 March 2024.
  8. ^ "Inequality-adjusted Human Development Index". hdr.undp.org. United Nations Development Programme. Archived from the original on 29 January 2016. Retrieved 22 November 2022.
  9. ^ "Labor force, total - Jordan". data.worldbank.org. World Bank. Archived from the original on 4 November 2019. Retrieved 3 November 2019.
  10. ^ "Employment to population ratio, 15+, total (%) (national estimate) - Jordan". data.worldbank.org. World Bank. Archived from the original on 4 November 2019. Retrieved 3 November 2019.
  11. ^ a b "Jordan foreign trade value". The Observatory of Economic Complexity. Archived from the original on 4 October 2024. Retrieved 4 October 2024.
  12. ^ a b "Foreign trade partners of Jordan". The Observatory of Economic Complexity. Archived from the original on 6 April 2023. Retrieved 18 June 2021.
  13. ^ "Sovereigns rating list". Standard & Poor's. Archived from the original on 28 September 2011. Retrieved 26 May 2011.
  14. ^ a b Rogers, Simon; Sedghi, Ami (15 April 2011). "How Fitch, Moody's and S&P rate each country's credit rating". The Guardian. Archived from the original on 1 August 2013. Retrieved 31 May 2011.
  15. ^ "What We Do". Archived from the original on 20 February 2009. Retrieved 3 March 2015.
  16. ^ "Jordan's projected GDP for the year 2023, as reported by the World Bank, in US dollars". Worldbank. 5 July 2024. Archived from the original on 30 April 2024. Retrieved 5 July 2024.
  17. ^ "'Jordan and Turkey strengthening historical bonds' - Jordan - Zawya". Archived from the original on 17 June 2011. Retrieved 28 October 2010.
  18. ^ "Jordan obtains 'advanced status' with EU | Jordan Times". Archived from the original on 20 February 2011. Retrieved 22 December 2010.
  19. ^ a b "Jordan is Sliding Toward Insolvency". KIRK H. SOWELL. Carnegie Endowment for International Peace. 18 March 2016. Archived from the original on 3 April 2016. Retrieved 20 March 2016.
  20. ^ Malkawi (6 February 2016). "Syrian refugees cost Kingdom $2.5 billion a year – report". The Jordan Times. Archived from the original on 12 June 2016. Retrieved 30 July 2016.
  21. ^ "Jordan: Economic impact of the Syrian war's next stage". Global Risk Insights. Archived from the original on 18 January 2019. Retrieved 18 January 2019.
  22. ^ "Gov't readying for refugee donor conference". The Jordan Times. 5 October 2015. Archived from the original on 6 January 2016. Retrieved 12 October 2015.
  23. ^ Omar Obeidat (21 June 2016). "IMF programme to yield budget surplus in 2019". The Jordan Times. Archived from the original on 11 January 2017. Retrieved 9 March 2017.
  24. ^ "Slowing Jordan's Slide into Debt". Kirk Sowell. Carnegie. 22 March 2018. Archived from the original on 25 May 2018. Retrieved 31 May 2018.
  25. ^ European Investment Bank (17 March 2022). Banking in Jordan: Financing corporates and SMEs in the era of COVID-19. European Investment Bank. ISBN 978-92-861-5224-5. Archived from the original on 3 August 2022. Retrieved 2 August 2022.


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