Human development as driver of economic growth

Human factor is a vital element of a well-functioning market economy. In the Jordanian context, Jordanians have always had an implicit consensus that human development is the key to a robust and prosperous Jordan. Due to limited natural resources, humans became the main resource to the Jordanian economy over the years. However, these resources are not exploited in the most efficient manner, due to the several challenges hindering them from achieving their potentials. Those challenges fall into three main categories; health, education and transportation — the very same categories that constituted the main pillars of the fourth and latest governmental economic reform package. 

Prime Minister Omar Razzaz said that this package aims to maintain the sustainability of the preceding economic stimulus packages outcomes. However, in general, the new measures seem to be unsustainable with short-living growth fruits, given the governmental poor fiscal situation. In addition, Jordan ranks 102 globally on the Human Development Index issued by the UNDP, and 79 on the Human Capital Index issued by the World Bank. These ranks indicate the Jordanian deep need for serious structural reforms in health and education to improve human development status. 

Regarding the education and health sectors, the measures included increased capital spending to build new schools, hospitals and healthcare centers. Such measures are necessary to meet the increasing public demand on these services.  Yet, the government dismissed that this kind of increased investment in 2020 will lead to increased running costs in the future in terms of wages and maintenance, an additional heavy burden on the government's weak fiscal shoulders. 

Moreover, the real challenge in these sectors is spending efficiency rather than the spending amounts. For instance, according to the prime minister, government expenditure on the health sector, 8.12 per cent of GDP, is higher than the global average, 6.6 per cent of GDP. Hence, increased spending will not solve the main issue. Enhanced efficiency and service quality is the case. 

In education, building more schools is a necessary step to absorb the growing population needs. Howbeit, the issue of educational quality is not addressed yet. The overall educational product needs to be reinvented and reformed. Primary and secondary school curriculums became obsolete and they require revolutionary reform that equips Jordanians to be competitive with their international peers. 

Overall, the recently taken governmental measures can be considered as a good tactical move to meet the growing demand for public provisions. However, the government must commit simultaneously to the implementation of the national human resources development plan in order to make the Jordanian human as the main growth driver in Jordan’s future.