Jordan

Economic and political outline

Economic indicators | Foreign Trade in figures | Sources of economic information | Political outline

Economic indicators

Jordan is classified by the World Bank as a "lower middle income country." It is a small country with limited natural resources. Through recent economic reforms aimed at liberalization of trade and attracting investments, Jordan has shown good performance. The GDP growth rate is over 6%. Poverty, unemployment (nearly 12%) and a large foreign debt remain major problems. The economy will continue to be vulnerable to external shocks and regional unrest. It is also very dependent on foreign aid. Over 2007 it worsened its budget deficit which rose to 8.5% of GDP against 7.2% in 2006. This is mainly due to the increase in subsidies for food and energy products combined with a drop in international aid. King Abdallah has set up a progressive economic liberalization policy favorable to foreign investors. Thus, special economic areas, the Qualified Industrial Zones (QIZ) as well as the Aqaba free zone offer not inconsiderable fiscal exemptions. In addition, the government has simplified registration procedures for foreign companies. Finally, the Jordanian State has launched a privatization campaign and favored public/private partnerships in many sectors.

GDP Indicators	2004	2005	2006	2007	2008
GDP (billions USD)	11.41	12.61	14.10	15.70e	17.38e
GDP (constant prices, annual % change)	8.6	7.1	6.3	6.0e	6.0e
GDP per capita (USD)	2,132.97	2,304.31	2,518.55	2,740.67e	2,966.93e
Inflation rate (%)	3.4	3.5	6.3	5.0e	4.5e
Current Account (billions USD)	-0.00	-2.26	-1.97	-1.98e	-2.07e
Current Account (in % of GDP)	0.0	-17.9	-14.0	-12.6e	-11.9e

Source: IMF - World Economic Outlook Database; World Bank - World Development Indicators

Note: (e) Estimated data

Socio-demographic indicators	2002	2003
Unemployment rate (%)	16.2	15.4

Source:

Main sectors of industry

Agriculture represents about 2.2% of GDP. The lack of water is putting a brake on agricultural development. The principal crops are wheat, barley, lentils, tomatoes, eggplants, citrus fruits, olives, and grapes. Phosphates and potassium are the only natural resources. The manufacturing sector is rather limited and dominated by textiles, a sector in a state of crisis at the present time due to international competition. Industry and mining together contribute nearly 29% to GDP. The government has identified the sector of information technology (IT) and tourism as promising growth sectors. The services sector contributes nearly 69% to GDP. Jordan is expecially at the forefront in the field of communication technologies and financial services. The sectors of distribution and tourist infrastructures also contribute substantially to GDP even if there was some slowing down in 2007 when growth was 5.1% against 6.5% in 2006. The construction and transport sectors have also boomed recently.

Breakdown of economic activity by sector	Agriculture	Industry	Services
Value added (annual % change)	5.4	11.4	-2.5
Value added (in % of GDP)	2.7	31.7	65.6
Employment by sector (in % of total employment)	3.6	21.8	74.2

Source: World Bank - World Development Indicators - last available data.

Monetary indicators	2002	2003	2004	2005	2006
Average annual exchange rate for 1 USD	0.71	0.71	0.71	0.71	0.71

Source: World Bank - World Development Indicators

Foreign trade in figures

Jordan is now increasingly opening up to international trade. The share of foreign trade in the country's GDP is around 135%. It registers a structural deficit of its balance of trade due to its dependence on raw materials. Jordan is a member of the WTO and signed a free-trade agreement (FTA) with the USA in December 2001 which will phase out duties on nearly all goods and services by 2010. Jordan has also signed an Agreement of Association with the EU. The country’s top three export partners are: the USA, Iraq and India. The commodities mainly exported are clothes & clothing accessories, fertilizers, pharmaceutical products, and edible vegetables. The top three import partners are: Saudi Arabia, China and Germany. Jordan mainly imports mineral fuels & oils, vehicles, machinery, and electric & electronic equipment.

Foreign trade indicators	2002	2003	2004	2005	2006
Imports of goods (millions USD)	4,501	5,078	7,261	9,317	n.c.
Exports of goods (millions USD)	2,770	3,082	3,883	4,301	n.c.
Imports of services (millions USD)	1,883	1,889	2,146	2,542	n.c.
Exports of services (millions USD)	1,775	1,740	2,057	2,283	n.c.
Imports of goods and services (annual % change)	4.9	6.9	31.0	21.2	4.9
Exports of goods and services (annual % change)	19.2	3.9	20.4	5.8	0.7
Imports of goods and services (in % of GDP)	66.7	68.4	82.6	93.4	94.7
Exports of goods and services (in % of GDP)	47.5	47.3	52.6	51.9	50.7
Trade Balance (millions USD)	-1,731	-1,996	-3,378	-5,016	n.c.
Trade Balance (including service) (millions USD)	-1,839	-2,146	-3,467	-5,275	n.c.
Current Account (millions USD)	537	1,179	-18	-2,311	n.c.
Current Account (in % of GDP)	5.6	11.6	-0.2	-18.2	n.c.
Foreign trade (in % of GDP)	114.2	115.8	135.2	145.3	145.4

Source: World Bank - World Development Indicators

Main partner countries

Main customers (% of exports)	2006
United States	25.1%
Iraq	12.3%
India	7.7%
Saudi Arabia	7.1%

Main suppliers (% of imports)	2006
Saudi Arabia	25.6%
China	10.4%
Germany	7.8%
United States	4.7%
Egypt	4.2%

Source: 2006

Main products

Main exports (% of exports)	2006
Articles of apparel and clothing accessories, knitted	16.3%
Natural or cultured pearls, precious or semi-precious stones	9.2%
Fertilizers	9.1%
Articles of apparel and clothing accessories	8.0%
Pharmaceutical products	6.1%

Main imports (% of imports)	2006
Mineral fuels, mineral oils	23.8%
Vehicles other than railway or tramway	8.9%
Machinery and mechanical appliances	7.4%
Electrical machinery and equipment	7.4%
Knitted fabrics	4.0%

Source: 2006

To see more products: More imports (Intracen Data)
More exports (Intracen Data)

Sources of economic information

Ministries: Ministry of Economy, Industry and trade Ministry of Finance
Statistical Office: Department of Statistics
Central Bank: Central Bank of Jordan
Stock Exchange: Amman Stock Exchange
Online newspapers: Ad-Dastour (in Arabic)
Jordan Times
Al Ra'i (in Arabic)
Search Engines: Baladna
Jordanlinks.com
Jordan Internet Pages
Economic portals: Amman Chamber of Commerce

Political outline

Executive Power: The head of state is the King. The monarchy is hereditary.The King enjoys the executive powers. The King signs and executes all laws. He appoints and may dismiss all judges by decree, approves amendments to the constitution, declares war. The King appoints the Prime Minister as head of the government, having no fixed term of office.The cabinet, led by the Prime Minister, is appointed by the King.
Legislative Power: The legislature is bicameral in Jordan. Its parliament consists of: the House of Notables (the upper house) having 55 members who are appointed by the King to serve four-year terms; and the House of Representatives (the lower house) having 110 members elected by popular vote on the basis of proportional representation to serve four-year terms. The King’s power of veto may be overridden by a two-thirds vote of both houses of the National Assembly .The people of Jordan have limited political rights. The first parliamentary elections in 22 years were held in November 1989.
Main political parties: Political parties were not legalized in the country until 1992. There is no clear picture of the political parties in Jordan. There is practically only one party, called the Islamic Action Front, which plays the real role of an opposition party.
Current political leaders: King: ABDALLAH II (since February 1999) – hereditary
Prime Minister: Nader DAHABI (since November 2007) - non-partisan
Next election dates: House of Representatives: Year 2011