Jordan Economic Forecast

Jordan Economic Outlook

October 2, 2018

Although economic activity accelerated slightly in Q2, the economy remained on a low-growth trajectory due to high structural unemployment, large external imbalances and insufficient economic reforms. GDP expanded 2.1% in Q2 compared to the same period a year earlier, supported by stronger manufacturing output and a timid rebound in construction. Data for July shows that economic activity remained weak in Q3, with industrial production contracting for the eighth consecutive month and the trade deficit widening further. Meanwhile, in September, a revised tax bill was sent to parliament that seeks to generate JOD 280 million in additional revenue, mainly from expanding the tax base. The importance of such policy measures is underlined by the fact that in the January–July period the fiscal deficit widened by over 20% year-on-year.

Jordan Economic Growth

This year and next, economic growth should accelerate slightly due to increased remittances and tourism activity. However, fiscal consolidation and tighter monetary policy dampen prospects. Our panelists expect GDP growth of 2.3% in 2018 and 2.6% in 2019, which is unchanged from last month’s forecast.

Jordan Economy Data

20132014201520162017
Population (million)6.56.76.87.07.1
GDP per capita (USD)5,1455,3675,4985,5415,619
GDP (USD bn)33.635.837.538.711.1
Economic Growth (GDP, annual variation in %)2.83.12.42.02.0
Industrial Production (annual variation in %)1.61.70.9-2.1-0.7
Unemployment Rate12.611.913.115.318.3
Fiscal Balance (% of GDP)-5.5-2.3-3.5-3.2-2.6
Public Debt (% of GDP)86.789.093.495.195.3
Money (annual variation in %)9.76.98.14.00.3
Inflation Rate (CPI, annual variation in %)4.82.9-0.9-0.83.3
Policy Interest Rate (%)4.504.253.753.755.00
Exchange Rate (vs USD)0.710.710.710.710.71
Current Account (% of GDP)-11.4-7.3-9.1-9.6-11.6
Current Account Balance (USD bn)-3.5-2.6-3.4-3.7-4.3
Trade Balance (USD billion)-11.7-12.0-11.3-9.6-11.7
Exports (USD billion)7.98.47.87.67.5
Imports (USD billion)19.620.418.217.218.1
Exports (annual variation in %)0.26.0-6.6-3.7-1.1
Imports (annual variation in %)6.04.0-11.7-5.75.7
International Reserves (USD)12.014.114.212.912.3
External Debt (% of GDP)69.067.868.670.2-  

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Jordan Facts

ValueChangeDate
Exchange Rate0.710.0 %Aug 31
Stock Market3,8730.08 %Oct 18

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