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COUNTRY PROFILES
JORDAN
Introduction
For several years economic growth of Jordan
was fitful but recently the economy has returned to a stage
of recovery. Jordan presents a steadily increasing economy
with the growth of GDP in the first two quarters of 2001 to
be 4% while in 2000 was 3.9% compared to the 1.6% in 1999.
Nevertheless, the economy is showing serious signs of recovery
having high growth rate, penetrating in the markets of Iraq
and Saudi Arabia by exports of goods and improving the balance
of payments from the remittances from the workers in the Gulf
states. The economy of Jordan had achieved a shift from a
primarily agricultural one to an economy with increasing shares
of the services, manufacturing, tourism and transport sectors
to the GDP. The government is following an economic reform
programme, which includes tax, tariff, trade and fiscal reforms
as well as privatisation. Large companies including oil and
electric power generation firms are targeted for privatisation.
Jordan has made great progress in recent years in restoring
normal relations with the Arab states of the Persian Gulf.
A number of agreements also have been concluded between Jordan
and Syria in recent years.
The Euro-Mediterranean Association Agreement
with Jordan was signed on November 24, 1997. It entered into
force on May 1, 2002 and replaced the Co-operation Agreement
of 1977 once ratification is completed. The main aim of the
Association Agreement is to create a free trade area between
the EU and Jordan within 12 years and to establish a comprehensive
framework for political, economic, and financial co-operation.
The Agreement was ratified by the European Parliament and
is still undergoing ratification in national parliaments in
the EU. Jordan ratified the agreement in September 1999. Trade
links between the EU and Jordan are stable: in 2000, 9% of
the country’s export went to the EU while around one third
of its imports came from the EU.
Under the MEDA programme in the 1996-2000
period, the country received EUR 269 million in grants (73%
disbursed) and 283 million euro in EIB loans on own resources.
Funding concentrated on structural adjustment operations,
the promotion of small- and medium-sized enterprises, the
water sector and the protection of the Jordanian cultural
heritage. In 2001, under MEDA 20 million € were granted to
support regulatory reforms and privatisation.
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