Inflation in Jordan reached 5.3%, higher than gov’t estimates — EBRD

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AMMAN — The European Bank for Reconstruction and Development (EBRD) said that Jordan’s economic recovery “remains moderate, but strong”, with an annual growth of 2.5 percent in the first half of 2022, broadly supported by the service and industry sectors, and the strong recovery of tourism, according to Khaberni.اضافة اعلان

However, Jordan’s annual inflation has continued to rise, reaching 5.3 percent in July 2022, due to the increase in food prices and a 30.6 percent rise in energy prices following electricity tariff reforms, the bank added in a report issued on Wednesday.

According to the report, “GDP growth is expected to stabilize at 2.0 percent in 2022, as the repercussions of the war on Ukraine affect trade flows and tourism.”

The report indicated that there is “faster growth in the non-service sector, and a stronger recovery in global tourism, and trade flows could bring growth in 2023 to 2.7 percent”.

Achieving growth will depend on the country successfully implementing the reforms announced under the government’s Economic Modernization Plan to attract foreign direct investment and support new engines of growth.

Economic growth is expected to be helped by ongoing IMF-supported reforms; the main risks to the economic outlook include an erosion of real competitiveness due to an overvalued exchange rate, regional instability, and a slower-than-usual recovery in partner economies, the report said.

Meanwhile, economic expert Mazen Marji said Wednesday that the inflation figures announced in Jordan do not reflect the truth, particularly in view of the successive rises in commodity prices.

In statements to Khaberni, Marji said that the inflation rate was 2.46 percent at the beginning of the year, that the current figures for inflation cannot be realistic, and that the actual number is higher, due to the increase in the prices of dozens of commodities since the beginning of the year.

According to the Department of Statistics data, the government’s statistical arm in Jordan, the inflation rate reached 3.34 percent in the first half of this year; EBRD estimates that the annual inflation stood at 5.3 percent in July.

Marji stressed that certain statistics do not give a real indication of the inflation situation in Jordan, because inflation is not the result of high demand for goods, but rather the result of high prices.

He explained that the commodities being studied to determine the inflation index are incorrect, and that the inflation Jordan suffers from is caused by monopoly, in addition to the global rise in prices.

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