Jordan's promising economic outlook

The devastating impact of COVID-19 has underscored governments' lack of preparedness. It is also clear that the pandemic is unlikely to be the last crisis countries will face, as we witness increasingly frequent extreme climate change events, high financial vulnerabilities, and rising levels of conflict in some countries with disrupted supply chains.اضافة اعلان



A general photo of Amman. (File photo: Ameer Khalifeh/Jordan News)

Investing in preparedness rather than waiting for the next crisis to hit can help prevent human and economic losses. In Jordan's case, mega projects will help increase resilience, improve the country's response capability, and enable all sectors to reap benefits.

For rapid, resilient recovery, Jordan needs to implement reforms to enable an investment-driven growth model. These reforms should prioritize investment and create a business environment to promote programs and financing in the sectors required.

Jordan should use recovery efforts to tackle structural challenges in the economy, and give priority to economic sectors like tourism, agriculture, IT, transportation, and industry.

In collaboration with private sector investors (via PPPs), the government has launched a school project and is preparing for other infrastructure projects worth JD260 million. In addition, the Amman-Aqaba Water Desalination and Conveyance Project, worth JD2 billion, will deliver 300 million cubic meters of water to scale up the water sector and ensure a sustainable path for water supply, critical to growth and macro-economic stability.

It is necessary to focus on the efficiency and effectiveness of government institutions, promote personal development to encourage excellence in performance, embrace the concept of public service, uphold a professional code of conduct, and instill the principles of respect for the rule of law, of merit, and of equal opportunities.

Decisive government actions are needed to determine the private sector to encourage Jordanian labor participation and training.

Improving the business environment, governance, and competition is crucial to engendering strong, durable, and inclusive growth, including large infrastructure projects to address priority needs.

Jordan should prepare the private sector, including contractors, services providers, and finance institutions, for the upcoming projects. The telecommunication sector will create JD700 million-worth of direct opportunities to upgrade the network for 5G and other needs associated with emerging technologies.

These actions will promote entrepreneurship and competitiveness, and streamline investment efforts. They will significantly enhance the country's ability to retain and attract new investments in different fields, like transportation projects, the national railway, and Aqaba port, which will inject more than JD3 billion in the market within five years.

Furthermore, downstream projects will be witnessed, like the fourth expansion of the refinery, expansion of potash and phosphate industries, building new petrochemical complexes, in addition to the hydrogen production project that can make a revolution in the climate change, and the future of energy and technology.

Besides the petrochemical projects, the government announced upcoming concessions for copper and gold mines, along with rare elements and phosphate explorations in different locations; these investments can unlock multi-billion-dinar opportunities and will need a massive number of employees.

Jordan needs to bolster the legislative and institutional environment, lower production costs, and digitize its services. The government needs to be proactive to accelerate the PPPs infrastructure projects, which are challenging to deal with in terms of time because of long-term contractual commitments made by counterparties, including third-party lenders and investors. The strategy should involve a government investment management company (GIMC) to create an enabling environment for private-sector participation and de-risk transactions to allow investments to be the mainstream and generate sustainable economic growth.

The writer is a board member of a Jordanian public-sector government investment management company since 2019. He is currently the Business Development Director at Edgo, he worked with Petrofac, an international EPC company in various positions and countries in the Middle East, North Africa & UK region. Alayani holds a BSc in Mechanical Engineering (2006) and an MBA from the University of Aberdeen, UK (2021).


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