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Economy of Jordan
 
 
 

General

Jordan is a small country with limited natural resources, but has improved much since its inception as a country. Its current GDP per capita soared by 351% in the 70's. But this growth proved unsustainable and consequently shrank by 30% in the 80's. But it rebounded with growth of 36% in the 90's. Just over 10% of its land is arable, and even that is subject to the vagaries of a limited water supply. Rainfall is low and highly variable, and much of Jordan's available ground water is not renewable.

Jordan's economic resource base centres on phosphates, potash and their fertiliser derivatives; tourism; overseas remittances; and foreign aid. These are its principal sources of hard currency earnings. Tourism is, especially, a very important sector of the Jordanian economy, contributing between 10% and 12% to the country's GNP in 2006. In addition to the country's political stability, the geography offered makes Jordan an attractive tourism destination. Jordan's major tourist activities include numerous ancient places, its unique desert castles and unspoiled natural locations to its cultural and religious sites.

Lacking forests, coal reserves, hydroelectric power, or commercially viable oil deposits, Jordan relies on natural gas for 10% of its domestic energy needs. Jordan used to depend on Iraq for oil until the Iraq invasion in 2003 by the United States. Jordan is also classified as an emerging market.

Overview

Economy - overview
Jordan is a small Arab country with insufficient supplies of water, oil and other natural resources. Poverty, unemployment, and inflation are fundamental problems, but King ABDULLAH II, since assuming the throne in 1999, has undertaken some broad economic reforms in a long-term effort to improve living standards. Since Jordan's graduation from its most recent IMF program in 2002, Amman has continued to follow IMF guidelines, practicing careful monetary policy, making substantial headway with privatisation, and opening the trade regime. Jordan's exports have significantly increased under the free trade accord with the US and Jordanian Qualifying Industrial Zones (QIZ), which allow Jordan to export goods duty free to the US. In 2006, Jordan reduced its debt-to-GDP ratio significantly. These measures have helped improve productivity and have made Jordan more attractive for foreign investment. Before the US-led war in Iraq, Jordan imported most of its oil from Iraq. Since 2003, however, Jordan has been more dependent on oil from other Gulf nations. The government ended subsidies for petroleum and other consumer goods in 2008 in an effort to control the budget. The main challenges facing Jordan are reducing dependence on foreign grants, reducing the budget deficit, attracting investments and creating jobs.

GDP (purchasing power parity)
$27.99 billion (2007 est.)

GDP (official exchange rate)
$16.01 billion (2007 est.)

GDP - real growth rate
$4,900 (2007 est.)

GDP - composition by sector
agriculture: 3.5%
industry: 10.3%
services: 86.2% (2007 est.)

Labour force
1.563 million (2007 est.)


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