Overview

  • Over the past decade, Jordan has pursued structural reforms in education, health, as well as privatization and liberalization. More recently, Jordan has also made important reforms to put its economy on the path to long term prosperity, covering income tax, business regulations, insolvency and the public procurement framework. And it has revitalized trade with its neighbors, especially Iraq. The outlook for the economy reflects renewed momentum given recent signals of renewed international support through the London Initiative (February 2019). However, further progress is needed so that reforms aimed at enhancing the investment climate and ease of doing business can lead to concrete outcomes. 

    A major challenge facing Jordan remains to reinvigorate the economy in the context of a challenging external environment. Adverse regional developments, in particular the Syria and Iraq crisis, remain the largest recent shock affecting Jordan. This is reflected in an unprecedented refugee influx, in disrupted trade routes, and in lower investments and tourism inflows (particularly as a result of economic slow-down in GCC). Continued regional uncertainty and reduced external assistance will continue to put pressure on Jordan.  

    Jordan’s real GDP registered an estimated growth of 2 percent in 2018, marginally lower than growth in 2017, constrained by structural impediments and a difficult regional setting. High unemployment rate (18.6 percent annual average in 2018 compared to  18.3 percent in 2017), high dependency on grants and reduced remittances and official inflows from Gulf economies pose a serious challenge. According to provisional estimates for 2018, Jordan’s fiscal efforts remained below the budget target as the fiscal deficit (including grants) widened to 3.4 percent of GDP in 2018, 1.6 percent higher than the budgeted target for 2018. This was mainly due to limited revenue growth (vis-à-vis the budget targets) and limited flexibility to curtail recurrent spending. However, Jordan showed continued reform effort as evident from the enactment of the amended income tax legislation in November 2018. Public debt-to-GDP ratio marginally declined - for the first decline in a decade - to 94.2 percent at end-2018.  

    Moving forward, it will remain critical for Jordan to continue diversifying its energy supply in the medium term in order to reduce its macroeconomic vulnerabilities. Further sound economic policies and the quick implementation of key growth-enhancing reforms will also be necessary to reduce the country’s sensitivity to external shocks and help reinvigorate the economy. Finally, creating conditions for increased private investment and improved competitiveness will remain indispensable for Jordan to stimulate inclusive job-creating growth, boost productivity and improve household welfare. 

    Last Updated: Apr 01, 2019

  • On July 14, 2016, the World Bank Board of Directors approved a new WBG Country Partnership Framework (CPF) for Jordan for FY2017-2022. The new CPF builds on the Systematic Country Diagnostic which was circulated to the Board in February 2016. 

    The overarching objective of the CPF is to help Jordan renew its social contract and promote economic and social inclusion. The CPF promotes an ambitious agenda for growth, jobs and inclusion while helping Jordan address the impact of the Syrian crisis, including through innovative financing tools. The WBG has deployed concessional resources to support Jordan’s Syrian Crisis Response through an exceptional US$100 million International Development Association (IDA) allocation and the establishment of the Global Concessional Financing Facility (GCFF). 

    As of April 2019, the World Bank’s active portfolio in Jordan comprises 14 projects valued at US$1.3 billion in grants, concessional financing and low interest loans. These projects cover a number of key sectors, including education, health, environment, social protection, youth, access to finance, job creation and boosting the business environment. 

    In the context of the Jordan Compact, the Bank developed a US$300 million, concessional Program-for-Results operation which promotes economic opportunities for Jordanians and Syrian refugees. 

    In June 2017, the Bank launched an Emergency Health Project (US$50 million), supported by the GCFF, to support the Government of Jordan in maintaining the delivery of primary and secondary health services to poor uninsured Jordanians and Syrian refugees at Ministry of Health facilities.  

    The Jordan Education Reform Support Program (US$200 million), another operation benefiting from GCFF support, was approved by the Bank’s Board in December 2017. This Program for Results operation aims to expand access to early childhood education, and to improve student assessment, teaching, and learning conditions for Jordanian children and Syrian refugee children.  

    More recently, in June 2018, the Bank’s Board of Directors approved the Jordan First Equitable Growth & Jobs Development Policy Financing (DPF) for a total amount of US$500 million, which includes a GCFF grant contribution of US$111 million. The DPF aims to support Jordan promote inclusive economic growth, create more jobs, and expand the National Aid Fund cash transfer program to cover an additional 85,000 households. 

    Last Updated: Apr 01, 2019

  • Improved Municipal Service Delivery  

    The Emergency Services and Social Resilience Project helped 16 municipalities respond to the increased demand for services due to the large influx of Syrian refugees. The project funded goods, works and basic services amounting to US$40 million, reaching more than 2,000,000 Jordanians and close to 250,000 Syrian refugees of which at least 45% were women. This included solid waste collection, rehabilitation of basic infrastructure, roads network improvements, lighting in the streets, and easing rising community tensions.  

    Education Reform 

    The Second Education Reform for Knowledge Economy project contributed to the expansion of quality kindergartens and highly innovative, alternative childcare all over the country. A system was created to allow the Ministry of Education to publish monitoring and evaluation reports online. New schools and extensions were built. Enrolment rates in primary and secondary schooling increased from 96.9 percent to 98.1 percent, and 60.4 percent to 76.9 percent, respectively. 

    Jobs for Women and the Youth 

    The Micro, Small and Medium Enterprise Development for Inclusive Growth project helped create over 2,000 private sector jobs for the most disadvantaged. 62 percent of the project’s beneficiaries came from outside Amman, where unemployment and poverty rates are high. Women-owned enterprises represented 85 percent of the beneficiaries. Youth, who suffer from the highest unemployment rates, represented more than 45 percent. 

    Access to Legal Advice  

    The Access to Justice Project provided improved legal services to vulnerable communities, including poor Jordanians, as well as Iraqi, Palestinian, and Syrian refugees. The project was implemented by the Justice Center for Legal Aid (JCLA), a Jordanian civil society organization.  Consultations were provided to 4,500 beneficiaries and 1,600 public awareness sessions were held, reaching more than 40,000 beneficiaries. 

    Ecosystems and Income Generation 

    The Badia Ecosystems and Livelihoods project developed ecotourism facilities and experiences along a 250 km corridor between the Al Azraq and Shaumari Nature Reserves and the Burqu’ Nature Reserve. The corridor provided income-generating opportunities to Ar Ruwaished district and nearby communities in the northeastern Badia, whilst contributing positively to the conservation of the area's biodiversity. 

    Maintaining Population Access to Basic Services  

    At the outbreak of the Syrian crisis, the World Bank moved quickly to help Jordan cope with the massive influx of refugees. A US$150 million project was launched in 2013 to maintain access to essential healthcare services and basic household needs for the most affected by the influx. The project provided 2.5 million Jordanian beneficiaries of safety net programs with bread and fuel subsidies. 

    Last Updated: Apr 01, 2019

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Additional Resources

Country Office Contacts

Amman
+962 6 563 3733
zelkhalil@worldbank.org
Beirut
+961 1 962954