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Jordan: The World Bank’s Concerns about Poverty, Lack of Transparency, and Unstable Economic Situation

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Eng. Saleem  Al-Batayneh

Let’s imagine the scene in light of the lack of tools to predict what is in the knowledge of the unseen in the first place, No one knows what the intention of the World Bank is to intimidate the Jordanian public opinion, or at least to prepare it for the next difficult stage! The victim here is a people who have become poor, struggling with forces that sometimes throw them to the ground and sometimes throw them a fatal blow, and the state is silent and does not hear advice, and it needs a big voice to wake it upThe World Bank paints a grim picture of the current state of Jordan, highlighting the pressing issues of poverty, hidden hunger, and socioeconomic disparity. He questions the World Bank’s intentions, speculating whether they aim to intimidate Jordanian public opinion or prepare them for an upcoming difficult phase. Al-Batayneh emphasizes that the real victims are the Jordanian people, who are grappling with poverty and forces that continually knock them down, while the government remains silent and unresponsive. He believes that a strong voice is needed to awaken the authorities.

The problem of poverty and hidden hunger in Jordan is multifaceted and continues to grow, posing a threat to societal cohesion and stability. This situation has exacerbated the gap between different social classes. Al-Batayneh points out that Jordan’s poor have been neglected, even in the outputs of the Royal Commission for Economic and Political Modernization, and warns of future shocks that Jordanians may face.

Various studies and reports, including the recent World Bank report on global poverty in 2023, express concerns about the economic and living conditions in Jordan. The World Bank warns of potential shocks resulting from increased poverty rates, a growing number of poor and vulnerable individuals, limited job opportunities, stagnant per capita growth, weak family income growth, high commodity prices, and inflation. These factors put a significant portion of non-poor citizens at risk of falling into poverty, and the situation may worsen compared to the challenges faced during the COVID-19 crisis.

Furthermore, the Vice President of the World Bank for the Middle East, Farid Belhaj, identified Jordan as one of the four countries in the region that the World Bank is concerned about. Belhaj attributes this concern to high levels of public debt, inflation, and the Jordanian government’s failure to disclose undisclosed debts, particularly from state-owned enterprises. Belhaj emphasizes the need for transparency as a crucial first step toward initiating reforms and ensuring clear and transparent financial records.

In a 2018 document, the World Bank specifically highlighted the unfavourable conditions faced by Jordanian citizens, projecting that one-third of the population would fall below the poverty line in 2019. Jordan also ranked fourth among the poorest countries in the Arab world at that time.

The World Bank’s “Global Economic Prospects” report from 2021 predicts an increase in Jordan’s public debt from 115.6% to 117.9% of GDP by 2024. Additionally, a World Bank report from 2003 reveals that the bank’s executive managers approved an action plan presented by Jordan, securing $305 million in loans to combat poverty, improve education, and enhance the performance of the public sector.

Overall, the concerns raised by the World Bank regarding poverty, lack of transparency, and an unstable economic situation in Jordan call for urgent attention and comprehensive reforms to address these issues and uplift the lives of the Jordanian people.

Another document issued by the World Bank in 2018 highlighted the unfavourable conditions faced by Jordanian citizens, revealing that a third of the population would be below the poverty line in 2019. Moreover, Jordan was ranked as the fourth poorest country in the Arab world at that time. The World Bank’s “Global Economic Prospects” report of 2021 is projected that Jordan’s public debt will increase from 115.6% to 117.9% of GDP by 2024. In a diagnostic study conducted in 2016 by the World Bank, it was found that Jordan suffers from the “missing middle” syndrome and an individualistic mindset that fails to grasp the true meaning of risk management.

The study also emphasized the importance of measuring the risk for any economy by comparing public debt with the gross domestic product, as this ratio serves as an indicator of economic health. Previous reports have indicated that Jordan has one of the highest debt-to-GDP ratios among developing countries. While most governments around the world spend between 50-60% of their GDP on providing a decent standard of living for their citizens, Jordan allocates only 2.1% of its GDP for this purpose, according to a report published in 2021 by the Bloomberg newspaper and the American Economic and Wall Street Journal.

Over the past fifteen years, the Jordanian economy has suffered from a lack of identity and clarity. Distorted policies and mismanagement of resources have led to a decline in living standards, an increase in poverty and unemployment rates, and a centralization of power in the management of the state’s resources. The absence of tangible economic and development plans and programs, as well as a focus on comprehensive development planning based on a robust economic foundation, have contributed to the deterioration of the economy.

The World Bank has repeatedly warned Jordan against borrowing from international financial institutions at high-interest rates. Other organizations, such as the Food and Agriculture Organization (FAO), have also warned about the detrimental impact of global inflation on expanding the ranks of the poor in several countries, including Jordan.

Poverty in Jordan has taken on various forms, extending beyond traditional notions of destitution and begging for survival. It now encompasses those with insufficient income and purchasing power, limited access to healthcare and education, and limited job opportunities. Non-material poverty, often referred to as multidimensional poverty, includes factors such as poor health, inadequate public education, social injustice, high youth unemployment, and social exclusion. This type of poverty is particularly dangerous as it threatens the political and social stability of the state, and undermines the fabric of society.

The current situation calls for effective governance and legislative action. Jordan must address its overwhelming indebtedness and focus on generating revenue, implementing proper taxation, addressing violations, and seeking loans, aid, and grants with a comprehensive risk management framework. The state should recognize that investing in healthcare, education, and transportation is vital to prevent people from falling into poverty.

Former Jordanian Deptuy