The Toughest Test for Governments

By Jumana Ghunaimat

تم نشره في Sat 6 August / Aug 2016. 12:00 AM
  • Jumana Ghunaimat

Over the last few years, Jordan’s economy was able to adapt with a variety of difficult local and regional factors, which allowed for it to overcome several coarse phases. We did not end up like Greece, like the former Ministry of Finance warned we would; and the Jordanian Dinar was not affected in the way the Egyptian Pound was, on the contrary, our national currency stabilised by wise fiscal policies.

While it is true that our economy has endured safely, to an extent, so far much difficulty over the years, this does not mean that the threat to the stability of our economy have been removed; contrarily, they have deepened. Poverty rates skyrocketed, despite the official denial; as did unemployment rates, in spite of the many employment campaigns led by the former government, which should have had a positive effect, but did not. These actual outcomes of the official “propaganda” reflected in no way measureable to us!

Accordingly, income rates did not see a balancing raise; monthly income medians remained very low, which is evident in “Social Security Corporation (SSC)” figures and official statistics, from Social Security income medians, to outcomes of the recent income and family expenses census; all indicate that no significant rise, in any, in income averages was induced in recent years to balance any of the macro economic imbalances.

Naturally, the global drop in oil prices contributed immensely to alleviating some of the pressures incurred over the most recent year or two; driving down the national importation bill by over JOD1 billion last year alone. Weirdly enough, though; this fortune did not reflect, at all, on the ever so culminating expenditure deficit in our budget, which is indicative of a catastrophic consumption pattern, unfitting of the suffocating givens and conditions among people in general.

More so, additional aids, over that same period, had helped government treasuries keep the capital expenditure term alive in our budget and drive down the general deficit. In this discourse, the Gulf grant, particularly provided much support, totalling at USD5 billion over some years at annual USD1 billion basis, of which Jordan received USD750 billion every year, with Qatar falling out of arrangement and failing to pay a single penny over the extension of the Gulf Grant.

Additionally, there is also the quite generous support to Jordan, granted by the US; through direct financial aids ranging between USD1 billion and USD1.25 billion every year, next to global assurances on low interest loan from international parties. This particular pipeline is explicitly supposed to be continuous, according to the Americans, over the next number of years, unlike the fate of the Gulf Grant, which remains so far undisclosed to us.

Besides that, no exceptional aid is expected or in route. No other party will help extract Jordan out of the difficult financial situation it is in; there are only 2 sources of non-refundable grants, and we all know them by now.

In the end, what is meant by all that, is to say that all the factors for our financial survival, over the recent period of time, were foreign, external factors, that had absolutely nothing to do with the governments’ policies that have been overly reliant on reinterring policies to fund the Treasury. This, in turn, was only sustained by the popular mood and careful willingness to this this coarse phase through.

But after all these years, the Country’s economy remains, still, Jordan’s Achilles’ heel; apparently, the political spheres of the Country’s dynamics seem simpler, and more tied to the Decision Maker’s will to reform, which is evident in the upcoming elections to be carried out in accordance to an elections bill that received a general welcoming, as it —at least— got us rid of the deformed “Single-Vote” law.

Therefore, the economic question remains the toughest test for governments in Jordan. As for Dr Hani Mulqi’s government, they have many an instruments to tackle this issue. The first, and foremost of them, is the government’s economic team. Next to that is one instrument previous governments lacked; the Board for Economic Policies, which is aimed at supporting and sustaining works in the fields of economic policy and development.

Moreover, we have the new agreement with the International Monetary Fund (IMF), which is supposed to improve indices; perhaps this time, the IMF actually overcome their previous failures in previous programmes and finally attains the positive growth, instead of the negative results recurrent in the last couple of implementations!

After all, perhaps the government should carefully, and thoroughly look into what it has at hand, to outline a national economic reformation programme, inclusive of all above; that would reflect, finally, with betterment in the lives of Jordanians. Is it possible? The people have waited so long. How much longer do they have to wait?