Jordan has teetered on the edge of economic and political disaster, but it has managed to avoid the worst of the Arab Spring revolution that has ravaged its neighbors.
Domestic and external factors, though, continue to plague the country as it tries to enforce painful economic cuts, while at the same time keep political dissent at bay.
Its neighbors have not helped its cause. While Jordan was shaken up by the events unfolding in Egypt, Tunisia and Bahrain over the past two years, the civil war in Syria has completely robbed the economy of all confidence.
At home, Jordanians have been protesting on unpopular cuts and have railed at lack of political reform, corruption and mismanagement in the country.
While analysts have been predicting a breakdown in Jordan since the Arab Spring began, King Abdullah II has so far adroitly managed to sidestep disaster.
Still, the authorities remain uncomfortable with events brewing in the country.
"The regional turmoil has imposed considerable costs on the Jordanian economy," said Bank Audi in a note. "While sound macroeconomic policies have helped Jordan to navigate through a challenging period, developments during the past couple of years somehow aggravated an already difficult economic situation in Jordan."
The Council on Foreign Relations (CfR), a Washington-based think-tank says there are three possible scenarios in Jordan:
1) A 'Tahrir Square'-like uprising in Amman,
2) An Islamist squeeze play against the monarchy,
3) The defection of the regime's core base of support in the East Bank.
Dissecting the possibilities
Tahrir-Square: It may not take much to trigger widespread dissent. Jordanians have been out on the streets many times before over the past couple of years, but continued frustration could push Jordanians over the edge.
"This scenario envisions growing demonstrations driven by a gradual but steady erosion of support for the king and possibly the monarchical system itself," said the CfR in a new report on the country.
However, the Council notes that it is an unlikely scenario given that opposition groups are not united on the issue of reforms. Indeed, political reforms would undermine East Bankers and empower Jordanians of Palestinian origin (more about them later).
Islamists: Jordan is more vulnerable to Islamic forces. The region is teeming with jihadists and Muslim Brotherhood Jordanian unit playing an active role, and the dominance of Hamas in the Palestinian Territories. Their collective efforts may force the Jordanian authorities' hand.
"A concerted effort to undermine the king by Islamists in Cairo, Damascus, and Ramallah working with the local Muslim Brotherhood and more radical Salafists would pose a substantial threat," says the CfR.
However, factors that militate against its success are the ideological divisions and ethnic splits (i.e. Palestinian versus Transjordanian) within the Brotherhood and the fact that Jordan's tribal-based security apparatus is likely up to the challenge, assuming it is confident of the political will of the king and his regime.
East Bank defections: Relations between East Bank Jordanians and Jordanians of Palestinian origin have deteriorated over the past few years. Most public sector jobs, including those in the military, go to East Bankers and they are traditionally aligned with the Hashemite kingdom; leaving the private sector in the hands of Palestinians.
But East Bankers have been upset with their weakening circumstances and have been protesting. "Recently, such opposition has begun to emerge due to poor economic circumstances, alienation from Amman's nouveau riche, anger at the regime's apparent indifference to tribal grievances, and disgust at what is perceived as royally sanctioned corruption," said CfR.
However, most Palestinians have not joined in the protest and in fact have outlined their own grievances such as equal citizenship rights and end to discrimination against them in the public sector.
"The policy has created a divided Jordanian society where sentiments of fear and distrust, and conflicting interests prevail," said Lamis El Muhtaseb at the Norwegian Peacebuilding Resource Centre.
"Despite the depth of the links between the two peoples, this discriminatory policy, East Bankers' fear of Jordan being made the 'alternative homeland' solution to the Israeli-Palestinian problem, and Palestinians' fear of being deprived of their Jordanian citizenships and left without an identity have increased the schism; divided and weakened the protest movement; and inevitably, strengthened the regime."
The CfR believes this is the most likely scenario that could tip the scales in favor of chaos in Jordan.
Economic austerity
Jordan is also hamstrung with its financial limitations. The economy grew a paltry 2.8% last year and is set to grow 3.3% this year, according to the International Monetary Fund.
At the same time, Jordan is grappling with the influx of Syrian refugees that are overwhelming the authorities and putting a great strain on resources.
"Other risks stem from lower growth, a weaker current account (in particular related to higher oil prices and a renewed disruption in gas supplies from Egypt), and a further delay in implementing the energy strategy designed to bring [state-owned] NEPCO back to cost recovery," said the IMF. "These risks could trigger lower confidence, which could translate into considerable pressures on reserves."
An austere fiscal policy and full liberalization of fuel prices remain unpopular, though effective tools to control expenses.
The IMF has a standby arrangement with Jordan, while aid and loans have poured in from multilateral parties apart from Western and GCC governments.
However, youth unemployment stands at 29%, which should be a cause of concern especially as the economy is unlikely to lift off anytime soon.
The government will have to move on a number of fronts to release the pressure. This includes some efforts to curb corruption which has stained the authorities' credibility. Pressure from Western governments may push Jordan to try to stamp out the menace.
Aid and other loans and financial support will be crucial to ensure that the country passes through its difficult period.
"Washington could take several steps, including providing Amman with more bilateral aid, organizing "friends of Jordan" to augment their own support to the kingdom, and using its influence to convince Saudi Arabia and other Gulf states to fulfill their pledges of financial support," said CfR.
Finally, real political reforms will need to be initiated to ease public resentment. Change to media laws and electoral law to include more elected representatives would bring more people in the political process.
© alifarabia.com 2013
