Tourism and remittances support the national economy

This year, remittances of Jordanian expatriates are expected to top JD2.62 billion, while at the same time tourism receipts may reach JD3.2 billion. 

These two sources of foreign exchange are responsible for supporting Jordan’s balance of payments with up to JD5.82 billion a year, equal to 22.4 per cent of the country’s gross domestic product (GDP). This is obviously a very high ratio that can hardly be found elsewhere except, perhaps, in Egypt. 

Supporting, promoting and developing these two major sources of income in foreign exchange indicate a sound policy that should be re-enforced. However, even with the present low level of governmental support, it is most likely that tourism receipts will continue to grow, year after year, faster than the economy’s growth rate, thus gaining more importance. Expatriate remittances, on the other hand, will stabilise, with only a modest growth rate.  

The economic importance of the tourism sector is not confined to gaining foreign currencies; tourism activity creates lots of job opportunities as well.

In this respect, extra efforts should be exerted to prepare qualified staff in sufficient numbers to man hotels and restaurants and fill such jobs, instead of importing waiters from the Far East and managers from Europe and the US.

Expatriates’ remittances help in financing their families back home. It is the remittances that enable Jordan to import goods that are worth three times the proceeds of national exports. The major part of the trade deficit is being covered by remittances.

It should be noted that not all expatriate  remittances go to finance families’ consumption; part of the funds are saved in the form of deposits with banks, while another part is invested in real estate, company shares or other forms of investment.

Having said so much about the positive side of tourism and expatriates, it must be acknowledged that there is also an undeniable negative side. It demonstrates the fact that Jordan is heavily dependent on these two external sources, indicating that the   national economy is extremely sensitive and highly exposed to external factors that are difficult to predict or hedge.

The exposure of the Jordanian economy is extensive. It depends on external and uncertain sources and continues to be influenced by all regional and international unforeseen and uncontrollable developments. This is not new; Jordan has lived with such a state of affairs for long. Exposure is considered a natural situation in all small economies. In many cases Jordan was able to use regional crises to its own advantage.

Certain factors enabled Jordan to survive despite adverse circumstances. It is benefiting from a central geographical position, a state of stability, security and a good measure of democracy and openness. 

Tourism revenues and expatriate remittances will definitely be two prominent items, placed high on the upcoming 10-year national agenda, now under consideration.