Jordan's economic growth surpasses global average

(File photo: Jordan News)
AMMAN — Gross Domestic Product (GDP) quadrupled in the first quarter of the current century, reaching around JD7.12 billion in 1999 and rising to JD34.54 billion in 2022 at current prices.اضافة اعلان

The Jordanian economy experienced significant acceleration in the first decade of the century, accompanied by real annual growth averaging 5.5 percent during the period 1999-2008, reaching its peak with an average real annual growth rate of 6.2 percent between 2004-2008.

Economic growth during the period 1999-2022 reached a rate of 3.7 percent, which is higher than the growth rate in the Arab region and within the global average during that period.

From 1999 to 2009, Jordan maintained real growth rates higher than the global average and those of the Arab region.

In the second stage from 2010 to 2018, it maintained annual real growth rates with an average of 2.5 percent, the Jordan News Agency, Petra reported.

In the third stage from 2019 to 2022, the economy witnessed a significant decline due to the repercussions of the COVID-19 pandemic. Growth reached (negative) 1.1 percent in 2020, but the economy started growing and recovering thereafter from 2021.

Dr. Hazem Qashou, a researcher in political and social affairs and a former minister, stated that the acceleration witnessed in Jordan's economic growth over a quarter of a century can be interpreted from various perspectives. These include fixed assets such as lands and real estate, which increased significantly in most provinces. He also mentioned the improvement in income levels, as the minimum wage more than quadrupled. These developments can be measured through investments in infrastructure, services, roads, and others in different provinces, providing a sense of security for citizens.

Dr. Qashou pointed out documented information from "The Great Transition" book by His Majesty King Abdullah II Fund for Development on Jordan's ability to protect its monetary system and maintain the stability of the dinar despite various strategic and economic crises globally.

He highlighted objective crises that accompanied the economic achievements, such as the Iraq war, the global economic crisis, the Arab Spring, terrorism, the COVID-19 pandemic, and the recent Israeli war in Gaza.

He emphasized that Jordan's GDP should ideally surpass 50 billion dinars annually, but population growth has increased burdens, hindering the achievement of those levels and creating challenges like unemployment.

Per capita GDP evolved alongside economic growth, showing good growth rates in the first decade in real terms. It jumped from 2924 dinars in 1999 to a peak of JD3,655 in 2009, with an average annual growth rate of 2.5 percent.

Starting from 2013, per capita GDP began a gradual decline, reaching its lowest level in the COVID-19 pandemic year of 2020 at 2755 dinars, then gradually rising to 3056 dinars in 2022.

He stressed the need to build upon existing achievements and initiate major projects like artificial rivers, lakes, large dams, strategic cities, strategic projects, developing vital sectors, sports facilities, healthcare, and increasing productivity.

Maintaining national productivity, dinar stability, and foreign assets provided by the central bank and other factors is crucial for Jordan's security, stability, and prosperity.

The government took measures to address the global financial crisis, ensuring all citizens' deposits in the banking sector until the end of 2010. This included deposits of licensed banks in the Kingdom and deposits of non-residents and central government deposits at the Central Bank of Jordan.

The Central Bank of Jordan raised the mandatory reserve ratio from 8 percent to 10 percent, then gradually reduced it to 7 percent in light of inflation reduction in October 2008.

Dr. Alaa Al-Bashaireh, an economics professor at Hashemite University, mentioned that Jordan underwent political and economic events from 1999-2022 that contributed to inflation due to regional political events, influx of refugees, the 2008 global financial crisis, the Arab Spring, rising energy costs, Syrian refugees in Jordan, the COVID-19 crisis, and supply chain issues.

She explained that inflation acts as fuel for nominal GDP, though real GDP growth lags behind, and refugee waves pressured infrastructure, raising inflation rates but positively contributing to real production through investments, especially in food industries and others.

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