Laith Alajlouni
Atlantic Council, Jan. 4, 2023
“… polling data shows a significant level of dissatisfaction among Jordanians, where 70 percent believe that their country is “governed in the interest of a few.””
On December 14, 2022, a new nationwide strike took place in Jordan four years after another strike toppled the government of Prime Minister Hani Mulki. Again, the motives are economic. Led by truck drivers, the new protests in Jordan are over the increase in gasoline prices following the government’s disclosure of its planned budget for 2023. Since the strikes began, the protesters enjoyed a significant level of support among Jordanians, who are already suffering from the current economic situation, especially with the rise of unemployment and poverty rates.
The protests led to clashes with police and the killing of a police officer on December 16, 2022. The situation in Jordan raises many questions on why Amman is still unable to reform its economy despite receiving tremendous amounts of foreign aid—around $3.5 billion annually. It also raises many questions on why the Jordanian government seeks easy solutions, like gasoline price increases, instead of implementing structural reforms to solve Jordan’s fiscal and economic issues.
In the Jordanian context, international and local analysts blame this situation on limited resources, limited fiscal capacity, and regional turmoil. However, these are only symptoms of Jordanian economic structural weaknesses.
Top aid recipient but slow on reform
Jordan is highly aid dependent and among the top US and international foreign aid recipients globally. Despite that, foreign aid was one of Jordan’s main stabilizing factors in the past few years. Yet, many questions are being raised among Jordanians and international observers regarding slow reform implementation in the country and the persistently weak economy. In fact, Jordan is one of the top foreign aid recipients globally. For example, Jordan was the second highest aid-receiving country from the United States in 2021. According to the Organisation for Economic Co-operation and Development (OECD) data, Jordan received around $32.4 billion during 2011-2020 in foreign aid, as shown in the graph below.
Notwithstanding the tremendous amounts of foreign aid received by Jordan, the country is currently suffering from a 22.6 percent overall unemployment rate, a public debt constituting around 110 percent of the country’s GDP, and around 27 percent of the population living in poverty. Moreover, polling data shows a significant level of dissatisfaction among Jordanians, where 70 percent believe that their country is “governed in the interest of a few.” However, as this article argues, that is not the only issue, with there being five main obstacles to economic reform implementation in Jordan. … source