Last month, World Bank’s Spring 2017 issue of the Jordan Economic Monitor was released in the height of high unemployment and slow economic performance in the Kingdom.
The Jordan Economic Monitor, a product of the World Bank’s Global Practice for Macroeconomics and Fiscal Management (GMFDR) team, outlined the problems facing the Kingdom’s current economic climate and implored the government to take swift action in rolling out strategic reforms in order to improve Jordan’s current economic slump.
The report outlines the importance of ‘Green Growth’ as a means in which to revitalize Jordan’s economy. “Jordan has an opportunity to vitalize green growth and undertake climate action as part of a sustainable solution to fiscal, economic, and climate vulnerabilities,” said Kanthan Shankar, the Word Bank’s acting director for the Middle East.
Jordan’s Economic Green Growth Plan aims to double the growth of Jordan’s economy between the years of 2018 and 2020. However, Lea Hakim, the World Bank economist for Jordan, said: “Short of a positive shock such as the reopening of trade routes with Iraq or a peaceful conclusion to the Syrian conflict, and given fiscal and monetary policy tightening, it is difficult to foresee an impactful jumpstart to growth unless strategic structural reforms are implemented at a quicker pace.”
As of now, the economy has remained sluggish. In 2016, growth slowed down to 2.0 percent from 2.4 percent in 2015; this is significantly below the 2.7 percent average for the MENA region. Additionally, with unemployment at 18.2 percent, labor force participation at 40.5 percent, and employment rates at 33.1 percent, women tend to be worse across the board regarding these indicators.
Furthermore, according to the report, a major challenge for the Jordanian authorities remains stimulating growth and job creation, while reining in the fiscal deficit and hosting more than 660,000 registered Syrian refugees. However, green growth is beginning to look like the appropriate alternative in tackling this economic slump. Promoting green growth could lead to new jobs, reduce reliance on imports, attract foreign direct investment, and bring in international climate finance, it said.
With Jordan being a part of the UN Framework Convention on Climate Change (UNFCCC), it has been one of the most active participants in fighting climate change in the region. Having made several commitments throughout the years with the Kyoto Protocol, Jordan’s National Climate Change Policy of 2013 and ratifying the Nationally Determined Contributions outlined in the Paris Agreement, Jordan has steadfastly seen green growth as a means in which to create a strong economy outside the Kingdom’s limited resources.
Jordan’s growth plan consists of three clusters—the Green Growth Corridor, Smart Urban and Rural Resilience. These three clusters represent a holistic approach toward implementing green projects, supporting job growth and promoting innovation throughout the country. Additionally, they represent a mergence between climate action, sustainable local development, and macroeconomic considerations.