World Bank pledges to continue supporting Jordan
Jordan remains vulnerable to external shocks, the World Bank said Saturday in a press release at the end of talks between a senior management team and top Jordanian officials. Addressing members of the media, Managing Director Sri Mulyani Indrawati noted that Jordan’s economy has naturally been affected by the Arab uprising, due to its close proximity to the unfolding events. "At this time of incredible change in the Arab world, and of global economic crisis, Jordan is clearly affected,” Inger Andersen, vice president for the Middle East and North Africa, was quoted as saying in the press statement.
According to the press release, Indrawati said: “The Jordanian economy has been strained due to a drop in foreign direct investment, tourism, remittances and exports. The rise in food and fuel prices has heavily impacted the budget.” “Indrawati has renewed the financial institution’s commitment to assist Jordan in solving its deep economic and social hardships stemming from regional political turmoil and the global economic slowdown,” the press statement said. In government meetings, Jordanian officials shared the complexity of the internal and external factors that are straining the Jordanian economy.
The prime minister underscored that rising food and fuel prices, as well as the interruption of gas supplies from Egypt because of the frequent acts of sabotage targeting the pipeline in the Sinai Peninsula have significantly taxed citizens, especially middle and the lower-income households. “Much of the official discussion focused on Jordan’s efforts to stimulate growth and create jobs, strengthen the social protection system and consolidate the macro-economic framework in the country, which remains vulnerable to external shocks,” the press statement said. “In this context, the talks examined how best the new 2012-2015 Country Partnership Strategy (CPS) can be implemented to provide the necessary support to the government to create jobs, protect the poor and vulnerable, achieve fiscal consolidation and enhance transparency and accountability,” it added.
For the period of the CPS, the bank's programme in Jordan includes technical assistance in a wide range of sectors and policy areas as well as financial support of $500 to $650 million. The International Finance Corporation (IFC), the bank group’s private sector arm, has significantly ramped up its programme in Jordan in recent years, and will continue to do so. The IFC portfolio is currently $653 million, and annual investments of around $100 million are expected over the CPS period.
Andersen indicated that, in the context of the new CPS, the overarching goal of the World Bank Group’s (WBG) engagement is to help Jordan enhance its growth resilience and create jobs for all Jordanians. “To this end, the WBG will provide the necessary support to Jordan in the following three priority areas: (i) strengthening the foundation for growth with a focus on competitiveness; (ii) enhancing social protection mechanisms and promoting local development, and (iii) creating fiscal space to increase the capacity to cope with shocks,” the press release quoted Andersen as saying. She added: "Jordan has strong fundamentals and it is important that the government capitalises on these. It has strong institutions, a highly educated and skilled population, vibrant entrepreneurial creativity and a strong private sector, and significant reserves. It also has a growing and active civil society which is critical to foster meaningful debate.” “By moving quickly along the path of reform, by better targeting its social expenditures, by capturing efficiencies and by ensuring a strong business environment, Jordan can address short-term challenges, while it also attends to longer-term priorities such as energy diversification and water security," Andersen elaborated.
In discussions with civil society organisations, the World Bank’s senior management team heard about their activities and challenges across a wide range of issues including education, job creation, gender, poverty reduction and access to information among others. For countries like Jordan and other Arab countries now in the process of change, Indrawati stressed in the press statement: “Enforcing a rule of law that is not selective and hearing the voices of the people” are the key pillars of an approach. The rule of law, she said, depends on a “reliable judicial system and on a strong, informed media to help create the culture of checks and balances.”
- A spectacle of $8 trillion and more: what's the MENA Investment Conference in London all about?
- An odd dynamic? Saudi using desert to emulate Chinese model and attract Chinese investors
- Are Islamic finance's non-Muslim adherents 'pushing the limits'?
- Against all odds: Bank Audi to expand in Egypt, Syria
- No 'Islamic' finance here: the Islamic State's banking policy and the 'experts' behind it