Jordan's economy shows signs of recovery this year

AMMAN - The national economy has shown signs of recovery and is expected to achieve positive growth rates in the coming years, Central Bank of Jordan (CBJ) Governor Ziad Fariz said on Wednesday.

Inaugurating the fifth forum on banks’ social responsibility, Fariz added that Jordan has managed to overcome formidable challenges in the past five years, the Jordan News Agency, Petra, reported.

The regional and world situations, he said, have led to a decline in growth rates to way less than their historic rates of 7.1 per cent recorded before regional crises emerged to an average of 2.6 per cent after the outbreak of crises between 2010 and 2016.

However, according to the governor, the growth rate remained positive, reaching in the first half of the year 2.1 per cent, and is expected to reach 2.2 per cent by yearend, compared to 2 per cent by the end of 2016.

The governor cited a rise in tourism revenues by 12.7 per cent by the end of October, compared with a decline of 1.8 per cent in the same period of 2016.

Meanwhile, direct foreign investments grew by 30 per cent in the first half of 2017, and expatriate remittances went up by 0.7 per cent by the end of September, compared with a decline of 4 per cent in the same period last year, he added.

The governor also underlined the stability of national exports, after recording a 7.8 per cent drop in 2015 and 2016, noting that exports rose by 8 per cent by the end of August this year.

As for the reopening of borders with Iraq, he said, there are some signs that trade with Baghdad has been improving, stressing that the volume of exports to Iraq will take some time to restore the pre-closure levels.

The effect of the reopening is expected to be obvious as of the second half of 2018, Fariz told his audience.

Listing more positive developments, the CBJ chief said that capital expenditure grew by 7.4 per cent by the end of September, compared with a 9.4 per cent drop in the same period of last year, Fariz noted, stressing that such a growth contributes to improving performance of the various sectors of the national economy.

The situation will improve further in light of the government’s determination to build more partnerships with the private sector to implement capital projects, he explained.

The governor also cited a steady increase in the credit facilities banks grant to the private sector, which registered a growth rate of 7.8 per cent by the end of September this year.

Meanwhile, the central bank has done a good job in implementing its own mandate, according to the governor.

Fariz said that the CBJ has succeeded in maintaining the Kingdom’s monetary and financial stability and increasing demand on the Jordanian dinar as a safe haven for local and foreign savings.