Traveling to a country is the best way to learn about its monuments and natural attractions, but it also provides an interesting way to approach its economic reality. What are the sectors that contribute the most to the national GDP? How dependent is it on tourism? You’ll find the answers to these and other questions on this page about Jordan’s economy, where we focus on macro data that will help you understand its situation, both specifically and in relation to its neighbors in the Middle East.
Despite being considered one of the most stable countries in the Middle East, the instability and uncertainty of its neighbors negatively affect the economy of Jordan for various reasons.
Firstly, due to the fall in exports to countries such as Iraq or Syria, whose internal problems have hindered their economic growth and demand for Jordanian goods and services. Secondly, due to the waves of refugees arriving in Jordan and compromising the country’s social assistance and resources. And thirdly, due to the possible ‘contagion effect’, resulting in less foreign investment due to a certain level of distrust.
As a result, there has been a slowdown in the growth of Jordan’s economy since 2011, which peaked in 2010 with almost 6.5%, but was reduced to 2% a few years later. Consequently, the country has been forced to seek external assistance, specifically through support programs from the International Monetary Fund.
Jordan’s economy is mainly based on services (75.5% of GDP), while industry accounts for 19.6% and agriculture represents 4.9% of the total.
There are two factors that explain the relatively low weight of industry and agriculture in Jordan’s economy. In the first case, the absence of natural resources for energy production penalizes the industry: it has no oil, unlike its Gulf neighbors, and also has no natural gas. In the second case, the extreme aridity of Jordanian territory means that only 10% of its land is arable, concentrated mainly in the northern Jordan Valley.
However, these are the main sectors or strategic products for Jordan’s economy, and their corresponding contribution to the national GDP:
Public administration: 34.4% Finance and private ownership: 18.8% Various manufacturing, such as textile products: 17.4% Tourism and commerce (hotels, bars, restaurants, etc.): 9.2% Transport and communications: 8.4% Agriculture: 4.9% Construction: 2.8% Mining: 2.2%. The main minerals extracted and exported are phosphates for fertilizers (fifth largest producer in the world) and potash.
Beyond these specific sectors, one transversal sector that can be mentioned is luxury, which has a prominent presence in the country. Although it may not have the strength of other Arab countries, such as the United Arab Emirates or Qatar, the truth is that its monumental and natural attractions, combined with Jordanian hospitality, make many premium travelers set their sights on this country. Therefore, there are exclusive resorts and high-standing services in destinations such as Aqaba or the Dead Sea.
To understand the situation of the country’s economy, we have compiled here some macro data provided by the Spanish embassy in Amman:
However, some of these data may be somewhat distorted by the impact of the Covid-19 crisis on Jordan’s economy, which caused a sudden halt for several months due to the population’s confinement and the drastic reduction of international visitors.