Jordan’s economy grew at a faster pace in the first quarter of 2012, prompting economists to forecast stronger performance for the entire year. On Wednesday, the Department of Statistics (DoS) reported that the gross domestic product (GDP) expanded by 3 percent in the first three months, higher than the 2.26 percent during the same period of 2011 and down from the 3.1 percent rate in the fourth quarter of last year. The growth rate is higher than officials’ and analysts’ expectations of around 2.5 percent pace.
Describing the growth rate as “good”, economist Yusuf Mansur expected the Kingdom’s economy to expand at an accelerated pace in the coming month, supported by external factors. The fact that international oil prices and the euro exchange rate versus the US dollar are on a decline will help Jordan reduce its imports bill, he explained, pointing out that the number of tourists coming to the Kingdom and remittances of Jordanian expatriates are rising. Demand on construction is also increasing, according to Mansur, who predicted the GDP growth rate to be around 5 percent by the end of 2012.
“Jordan’s economy is relatively small, which can achieve faster recovery,” he added. Analyst Zayyan Zawaneh also expected the economy to perform stronger in the second and third quarters, describing the 3 percent rate as positive. “The growth rate reflects optimistic forecasts in light of regional turmoil,” said Zawaneh, a former adviser at the International Monetary Fund and the Central Bank of Jordan.
Jordan should benefit from higher tourism receipts this year due to stability and security advantages over regional competitors, he added, agreeing with Mansur that external factors –– drop in euro exchange rate and oil prices –– represent an opportunity for Jordan’s economy. For the entire year, the analyst expected the GDP to grow by 3.5 percent, a figure he believed is “fair” with ongoing global and regional uncertainties. According to the DoS report, the hospitality sector, hotels and restaurants registered the highest growth rate in the January-March period at 14.2 percent followed by electricity and water sectors at 8.9 percent and social services at 8 percent.
