Overview

  • Over the past decade, Jordan has pursued structural reforms in education, health, as well as privatization and liberalization. The Government of Jordan has introduced social protection systems and reformed subsidies, creating the conditions for public-private partnerships in infrastructure and making tax reforms.

    More work needs however to be accomplished so the focus on identifying steps towards enhancing the investment climate and ease of doing business can lead to concrete outcomes.
    Adverse regional developments, in particular the Syria and Iraq crises, 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. The large number of Syrian refugees in the country is having a strong impact on the country’s economy and social fabric.

    Other major challenges facing Jordan include high unemployment, a dependency on grants and remittances from Gulf economies as well as continued pressure on natural resources (particularly water). Jordan’s fiscal situation improved in 2017. The fiscal deficit, including grants, contracted to 2.6 percent of forecasted GDP in 2017, from 2 percent in 2016. The unemployment rate averaged 18.3 percent in 2017, while the labor force participation rate averaged 39.2 percent.

    On August 24, 2016, the IMF Board of Directors approved a three-year extended arrangement under the Extended Fund Facility (EFF) for Jordan to support the country’s economic and financial reform program. This program aims at advancing fiscal consolidation to lower public debt and broad structural reforms to enhance the conditions for more inclusive growth.

    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 growth-enhancing reforms will also be necessary to reduce the country’s sensitivity to external shocks. Finally, creating conditions for increased private investment and improved competitiveness will remain indispensable for Jordan to stimulate job-creating growth.

     

    Last Updated: Apr 16, 2018

  • 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.

    As of March 2018, the World Bank’s active portfolio in Jordan included 12 projects valued at $745 million in loans and grants. These projects cover a number of key sectors, including education, health, environment, social protection, youth, access to finance, and the business environment.

    In recent years, the World Bank has supported Jordan’s capacity and performance in governance, fiscal management, public sector efficiency and private sector-led growth, through two reform driven, budget-supporting “Development Policy Financing (DPF)” (US$250 million each).

    The Bank has recently supported the fiscal sustainability and efficiency of the energy and water sectors through two other “DPFs” (US$250 million each).
    The Bank also provided support to bolster Jordan’s resilience to the Syrian crisis. The large influx of refugees from Syria has strained the government’s capacity to deliver basic services and led to an increase in social tensions, as well as in competition for jobs.

    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 approved 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. The 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. 

     

    Last Updated: Apr 16, 2018

  • - The First Programmatic Energy and Water Sectors Reform Development Policy Loan (DPL) supported substantial reforms to improve the fiscal sustainability and efficiency of the energy and water sectors, including through the diversification of fuel sources for environmentally friendly and sustainable power generation and optimizing water use. DPF-supported reforms have helped ensure that costs in these sectors are spread equitably, infrastructure systems are operated sustainably, and resources are managed efficiently.

    - The Emergency Services and Social Resilience Project (ESSRP) grant helped 16 municipalities respond to the increased demand for services due to the large influx of Syrian refugees. In the first two years of implementation, the project funded goods, works and basic services amounting to US$40 million. This included solid waste collection, rehabilitation of basic infrastructure, roads network improvements, lighting in the streets, and easing rising community tensions. The Project’s services have reached more than 2,000,000 Jordanians and close to 250,000 Syrian refugees of which at least 45% were women. Municipalities that have been participating in the project since the first year have reached their pre-crisis level of per capita investments in roads and solid waste management.

    - The Micro, Small and Medium Enterprise (MSME) Development for Inclusive Growth project has resulted in the creation of over 2,000 private sector jobs for the most disadvantaged segments of society. 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.

    - The Second Education Reform for Knowledge Economy project has 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.

    - The Access to Justice Project (Japan Social Development Fund & State and Peace-building Fund) provided improved legal services to vulnerable communities, including poor Jordanians, and Iraqi, Palestinian, and Syrian refugees. The project is 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.

     

    Last Updated: Apr 16, 2018

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LENDING

Jordan: Commitments by Fiscal Year (in millions of dollars)*

*Amounts include IBRD and IDA commitments


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Additional Resources

Country Office Contacts

Amman
+962 6 563 3737
zelkhalil@worldbank.org
Beirut
+961 1 962954