Alright Then… What Should We Do?

By Jumana Ghunaimat

تم نشره في Thu 20 October / Oct 2016. 12:00 AM
  • Jumana Ghunaimat

It true, all that is being said about the dangerous extents to which our financial situation has deteriorated; it is also true that the attained economic growth so far is insufficient. Similarly, it is also, just as true, that the regional condition is tightening as well. Despite all that, indebtedness and deficits need to be controlled, in order to be able to make it through the next few difficult years, evident from standing conditions at hand.

Nothing indicates that there is a promising fundamental change in regards to the economic situation, particularly taking into consideration the amounts of grants expected for next year, or the year after it. Most probably, the Gulf grants will not be renewed, simply because every Gulf state is dealing with their own issues and difficulties that have culminated now.

Saudi Arabia, notably, was Jordan’s prime donor over the last few years. And according to leaked information, Riyadh is taking a different approach in its support for Jordan; no more direct financial aids. From now on, Saudi will be investing in Jordan through the Jordan-Saudi Investment Fund, which requires several years for its effects to reflect on our economy. More so, Saudi too are now looking for creditors themselves, the way Jordan is, albeit for different reasons.

Other Gulf states will most probably not renew their collective USD1 billion grant to Jordan, provided by the 4 Gulf donor countries; Saudi Arabia, United Arab Emirates, Kuwait, and Qatar. The latter too fell back on its piece of the grant, allocated supposedly for capital expenditure.

Typically, this non-renewal would create a scalable crisis for financial planners, in regards to allocating alternative sources and funding for capital spending.

Certainly, the financial crisis, in light of receding local revenues and grants, does not mean the government is released of their responsibilities towards citizens, whether it be water, health and medical services, infrastructural services, or any other kind of public service that falls within the span of the respective public sphere. This, also complicates the situation for the State, as the attainment of alternative funding is not at all easy, given the combined local, regional, and even global condition.

Additionally, because quick fixes have become difficult, or rather unattainable, one would hope the government would seek to establish “new”, not so out of vogue, solutions, by draining its citizenry dry; which may be, in their view, the easiest and shortest way to go, especially with this evident and utter disregard of the negative public mood, which is caused by the increased living costs Jordanians have to endure. Subsequently, this disregard, coupled with reckless financial policies, will definitely reflect poorly, even dangerously on the domestic social fabric and its stability.

Once again, as such policy seems easy, it requires much reconsideration; perhaps a look back into the unfoldings of the last 4 years. Jordanians coped with a multitude of difficult decision, failing however patient, to see positive results come out of all these “reforms” in the figures of public finances, which weakens the citizenry’s conviction in that the pressures they bear will bring about relief.

Accordingly, there are a dozen examples on that. Since 2012, back-then Prime Minister Dr Abdullah Nsoor decided to float fuel prices, and continued to make further unpopular decision. Nonetheless, years after, we found out that the problem, despite all extreme measures adopted, has grown! Deficits increased, indebtedness as well has reached dangerous levels. Consequentially, where are all the promised outcomes of the many coarse decisions ratified by the government?

That said, the more important and logical question is: How can the citizenry trust its government again, accept the ratification of such decisions, while having not touched any betterment in a single aspect of public life in return for the huge price paid over the years?!

Whether or not the reforms have any positive outcomes, next year’s budget will come out, and we’ll see.