By Dr. Yusuf Mansur*
The latest estimates released by Jordan’s Department of
Statistics on September 30, 2026, show that real GDP grew by 3% in the second
quarter of this year—a rate I had previously anticipated—compared with around
2.8% in the same quarter of 2025 and 2.9% in the first quarter of 2026. The
Jordanian economy has thus reached the 3% threshold, following a gradual
improvement in growth over recent years.
The significance of this figure lies not simply in reaching
3%, but in the direction of travel. What, then, is driving growth today? Most
encouragingly, a significant part of the improvement is coming from the
productive economy. Recent data point to strong performance in manufacturing
and several related productive and service activities. This matters because
growth driven by industry, investment, and exports is fundamentally different
in both character and impact from growth that relies primarily on consumption
or short-term activity.
Manufacturing does not grow in isolation. Its expansion
stimulates transportation, trade, and services, while creating greater
opportunities for exports and employment. The larger the contribution of
high-productivity, high-value-added sectors, the greater the economy’s ability
to sustain growth rather than merely experience temporary upswings.
We will not move quickly from 3% growth to 4%, 5%, or even
8%. Sustaining significantly higher growth requires a gradual restructuring of
the Jordanian economy, not a single policy decision or a short-term stimulus
package. Under normal circumstances, an economy cannot double its growth rate
overnight. Higher sustainable growth requires expanding more productive and
higher-value-added sectors, increasing investment, deepening the industrial and
export base, accelerating the adoption of technology, improving water, energy,
and transport infrastructure, and better aligning human capital with the needs
of a changing economy. These are structural transformations, and they require
time, investment, capital accumulation, and productivity gains.
This is precisely why the pipeline of upcoming projects is
so important when assessing Jordan’s future growth prospects. The second
Executive Programme of the Economic Modernisation Vision for 2026–2029 includes
182 initiatives across 25 sectors, to be implemented through 392 projects. It
also includes major investment projects and public-private partnerships, while
the government expects investment in partnership with the private sector to
approach JD10 billion over the programme period. Some of these projects are
already being tendered or implemented in energy, water, transport, and
infrastructure.
The focus on projects matters greatly. Policies and
legislation can improve the economic environment, but projects are what
translate policy direction into actual investment and new productive capacity.
Nor does a major project deliver its full economic impact all at once. Its
effect begins during implementation through spending, employment, construction,
transportation, and demand for services. The impact becomes deeper once the
project is operational, adding new productive capacity, reducing some of the costs
facing the economy, and creating opportunities for further investment.
A significant part of the economic impact of projects
currently under preparation or implementation has therefore yet to appear fully
in GDP figures. This makes the current growth performance even more
encouraging: Jordan has reached the 3% threshold while a new cycle of
investment and major projects is still in its early stages.
There is a third factor that should never be underestimated:
confidence and expectations. An investor deciding whether to build a factory, a
company considering expansion, or a household deciding whether to purchase a
home or a durable good all make decisions today partly on the basis of what
they expect tomorrow to bring. This is why economics has long attached
considerable importance to confidence and expectations in explaining
investment, consumption, and overall economic activity.
In this context, an April 2026 public opinion survey by the
University of Jordan’s Center for Strategic Studies, conducted a year and a
half after the formation of the government, provides a useful indication of
public sentiment. It found that 54% of respondents in the national sample
believed that things in Jordan were moving in a positive direction. In
addition, 62% believed that the government had been capable of carrying out the
responsibilities of the period, while 64% said the same of the prime minister.
These findings do not mean that Jordan’s economic challenges
have disappeared. They do, however, indicate that a majority of those surveyed
continue to view the country’s overall direction positively, at a time when
economic growth is improving, and a new cycle of projects and investment is
beginning.
This confidence coincides with two important developments:
growth that has already materialised, and projects and investments whose full
impact has yet to be felt. Confidence does not create growth on its own. But
when accompanied by investment, implementation, and improving economic
indicators, it matters because it influences the willingness of companies and
investors to expand and commit capital.
It would therefore be wrong to argue that rising confidence
alone has caused stronger growth; the economic relationship is far more
complex. But better expectations do matter. They can encourage investors to act
rather than wait and give businesses greater confidence to expand. When this is
accompanied by project implementation and rising productivity, it adds further
momentum to the growth process.
Nor should our objective simply be to move the headline
growth rate from 3% to 4% or 5%. What matters more is that growth increasingly
results from higher productivity, relies more heavily on investment, exports,
and technology, and becomes better able to create jobs and raise citizens’
incomes. The purpose of economic growth is not to improve the numbers in the
national accounts; it is to improve people’s lives.
The picture today gives grounds for optimism. The economy is
growing at a stronger pace, productive sectors are gaining momentum, a
substantial portfolio of projects and investments is gradually moving into
implementation, and the government has placed projects, growth, and execution
at the heart of its economic programme. This is taking place alongside a
notable degree of confidence and positive expectations.
Three percent is not the ceiling for Jordan’s economy.
Perhaps its real significance is that it has been achieved at the beginning of
a new cycle of projects and investment, not at its end. As these projects move
into implementation, productive sectors continue to strengthen, and confidence
and expectations improve, Jordan has an opportunity to move gradually towards
higher and more sustainable rates of growth. Reaching those rates will not
happen overnight. It will be the result of restructuring the economy, raising
productivity, and broadening its investment and productive base.
*The
author is a former Jordanian Minister of State for Economic Affairs.
Published in Jordan Times 03 October, 2026
https://jordantimes.com/opinion/yusuf-mansur/jordan-at-threshold-of-new-growth-era-1307782
No comments:
Post a Comment