Do We Have A “Plan B”?!

By Jumana Ghunaimat

تم نشره في Mon 24 October / Oct 2016. 12:00 AM
  • Jumana Ghunaimat

Jordan’s economic predicament is nothing new. It did not come as a surprise, to the governments of Jordan, on contraire; it traces years back all the way to 2008, the year of the Global Financial Crisis, followed by a leap in oil prices, the fluctuation in the sourcing of Egyptian natural gas, up until the unfolding of the “Arab Spring” and beyond, leaving the Kingdom breathless in its race to come with rapid changes, landing one devastating blow after another to the economic situation.

That, and percussion of it all, including the recession in monetary and financial indices, pushing us back into the lap of the International Monetary Fund (IMF), after we had just concluded an economic reform programme sponsored by the IMF, inclusive of all the difficult decisions passed, didn’t change a thing in regards to the administration of the Country’s national economy!

Many governments had come and gone, and dozens of committees were formed along the way, with their many strategies, and still, we are going in circles! All the work done, to diagnose the economic issues, all the official theorisation on causes and remedies, got us nowhere but all the way back to the start, unfortunately; where we have to start, now, outlining a national reformation plan for our economy.

More so, because the agreed arrangements with the IMF will not get us out of our hole, at best; they may prevent us from slipping further in, we need to place a national reform agenda, directed at the leveraging our economy, identify its economic identity, and begin the reformation process that would bring our sick and weary economy back to life, instead of sufficing with the sedative recipes the Fund is giving us.

The diagnosis is no longer a mystery, or a secret, now that the economic situation is suffocating everybody. Public spending now averages around JOD10 billion annually, accumulating a deficit that has penetrated the acceptable ceilings. This is caused by the current expansion of expenditures lead by catastrophic, superficial policies and planning, to the point that it has become so difficult to control spending, that allocating financial resources cover other categories including pensions, salaries, interests payable and premiums, has become similarly uneasy.

On the other hand, the current GDP growth rate is not enough to meet the pressures of standing financial indices, which will not alleviate so long as the GDP does not shoot up, for example, from USD37 billion, now, to USD50 billion to USD60 billion. Which means we need our GDP, which hovers now around 2 per cent, to grow back to its previous levels before 2008, somewhere between 6 and 8 per cent.

So, how can it be done?

We should start working, instead of just theorising economics; first, we need to outline the characteristics of our economy, given it’s primarily a service economy, which depends mainly on human capital and qualified, trained, labour. This dictates a national planning in this particular direction, leading to the establishment of a strong economic build that bases on the expansion of sectors in whole; from tourism, to education, and health sectors, demanding more focus on these sectors.

Sadly, it seems we have yet to make the first step down a path of a thousand miles in the direction of attaining a growing economy that would secure our current and coming generations a future. Everything that is being done to day amounts to no more than just the adoption of containment recipes that address the sickness’s symptoms, in the stead of actually treating the problem with real remedies or rehabilitation.

It is expected, and demanded of Dr Hani Mulqi’s government to take this crucial issue seriously, instead of just sticking to the implementation of IMF programmes; once more we say: these programmes may prevent the recession of indices for now, but they will not suffice in the attainment of needed development. Will the government prepare a “Plan B”?!