Jordan's economic outlook

The devastating impacts of COVID-19 have underscored a lack of preparedness by governments. It is also clear that COVID is unlikely to be the last crisis countries will face with increasingly frequent extreme climate change events, high financial vulnerabilities and rising levels of conflict in some countries with disrupted supply chains. Investing in preparedness rather than waiting for the next crisis to hit can help to prevent human and economic losses. The future of Jordanian mega projects will increase resilience, improve the country's responses and benefit from enormous opportunities in all sectors.

For rapid, resilient recovery, Jordan needs to implement reforms to enable an investment-driven growth model.This reform should prioritise the investment and business environment to promote programmes and financing in the sectors required. Jordan can seize the opportunity of recovery efforts to tackle structural challenges in the economy and priority economic sectors include 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 multi-infrastructure projects worth JD260 million. In addition, the Amman-Aqaba water de-salination and national conveyance project is worth JD2billion and would deliver 300MCM of water to scale up the water sector and ensure a sustainable path for water supply critical for both growth and macroeconomic stability.

It is necessary to focus on the efficiency and effectiveness of government institutions, promoting personal development to encourage performance excellence, embracing the concept of public service, upholding a professional code of conduct and instilling the principles of the rule of law, merit and equal opportunities. Decisive government actions are needed to unleash the private sector encourage Jordanian labour participation and training. Improving the business environment, governance and competition framework is crucial to engendering strong, durable and inclusive growth with limited fiscal space, including large infrastructure projects to address priority needs. 

These corrective actions will promote entrepreneurship and competitiveness and streamline investment efforts by reducing the obstacles foot print of the economy. It will significantly enhance the country's ability to retain and attract new investments, As an emerging market, Jordan shall prepare the private sector, including contractors, service providers and finance institutes, for the upcoming projects as the telecommunication sector will create JD700 million direct opportunities to upgrade the network for 5G and other leads associated with emerging technologies, such as additive manufacturing and the Internet of things to gathers the momentum of the fourth industrial revolution (4IR).

Many promising opportunities in the transportation sector, the national railway, and Aqaba Port will inject more than JD3 billion in the market within five years. Furthermore,downstream projects in the fourth expansion refinery and other expansions in Arab Potash and Jordan phosphate to build new petrochemical complexes, including chloride, potassium hydroxide, aluminum fluoride, sulfuric acid, diammonium phosphate, and ammonia storage tanks with more than JD3 billion investments, in addition to the hydrogen production project that can make a revolution on the climate change and the future of energy and technology. Moreover, to petrochemical projects, the government has announced the upcoming concessions for copper and gold mines, along with rare element and phosphate explorations in different locations; these investments can unlock multibillion opportunities and need amassive number of employees.

Today, countries with a limited industrial base exhibit a low readiness for the future through weak performanceacross all drivers; however, Jordan shall bolster the legislative and institutional environment, lower production costs and digitalise its services.Therefore, the government shall 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 between their counterparties, including third-party lenders and investors. The strategy shall involve a government investments management company to create an enabling environment for private-sector participation and de-risking transactions to allow investments to be the mainstream and generate sustainable economic growth.

The author is board memeber of Jordanian public sector Goverment Investment Management company