About HKTDC | Media Room | Contact HKTDC | Wish List Wish List () | My HKTDC |
繁體 简体
Save As PDF Print this page

Jordan: Regional Turmoil Dampens Investors' Confidence

Key Information
Population8.11 million
Area89,342 sq km
CurrencyJordanian dinar (pegged to the US dollar at 1 USD = 0.709 JOD)
Official language(s)Arabic
Form of governmentConstitutional monarchy


Major Exports (% of total, 2014)Major Imports (% of total, 2014)
Manufactures (72.0%)Manufactures (47.6%)
Agricultural products (20.3%)Fuels and mining products (29.0%)
Fuels and mining products (7.7%)Agricultural products (18.8%)
Top three export countries (% of total, 2014)Top three import countries (% of total, 2014)
USA (15.8%)Saudi Arabia (19.4%)
Iraq (15.3%)China (10.5%)
Saudi Arabia (12.4%)USA (5.8%)

Source: Economist Intelligence Unit (www.eiu.com), World Trade Organization


Political Highlights

The Hashemite Kingdom of Jordan (“Jordan”) is a constitutional monarchy. Following the Arab Spring in 2011, King Abdullah II, in power since 1999, initiated a modest political reform programme and also sought international support to further economic reforms.

Adverse regional developments, in particular with the Syria and Iraq crises, remained the largest recent shock affecting Jordan, as reflected in the large refugee influx, disrupted trade routes and lower tourism inflows. As of February 2016, Jordan has already accepted more than 600,000 of the 4.6 million Syrians who have registered with the United Nations as refugees. The large influx of Syrian refugees has been placing a huge strain on Jordan’s security and social welfare systems.

Jordan adopts pro-Western foreign policy and maintains strong ties with the US and EU. The US provides Jordan with increased logistical, financial and military support to cope with the refugee inflow and the rise of the Islamic State. The EU also pledged that they would become more deeply engaged diplomatically, increase commercial and other co-operation agreements, and step up financial backing for Jordan, given concerns about the influx of refugees from the region to Europe.

Economic Trend

Economic Indicators2013201420152016*2017*
Nominal GDP (USD bn)33.635.838.8
Real GDP growth (%)2.8
GDP per capita (USD)4,660
Inflation (%)4.8
Budget balance (% of GDP)-8.2
Current account balance (% of GDP)-10.3
External debt (% of GDP)69.0

* Estimates
Source: Economist Intelligence Unit (www.eiu.com)


With few natural resources and a small industrial base, Jordan has an economy which is heavily dependent on external aid from abroad, tourism, expatriate worker remittances, and the service sector. Jordan has enjoyed the benefits of lower oil prices since the second half of 2014, which have helped to bring down the budget deficit, lower inflation and keep import costs in check, but they have concurrently constrained remittance, investment and aid inflows from the Gulf states. Trade has also suffered from the conflicts in Iraq and Syria, two key traditional export markets for Jordan, and from the closure of the Syrian-Jordanian border, which has hindered trade to Turkey, Lebanon and Europe and deprived Jordan of valuable transit activity between Europe and Saudi Arabia.

Government finances in Jordan were structurally weak and relied heavily on foreign aid. The International Monetary Fund (IMF) approved a US$ 2 billion Stand-by Arrangement for Jordan during 2012-15 to address fiscal and external challenges and foster high and inclusive growth. Gulf Arab backers have sharply reduced financial support to Jordan in the past year amid the collapse in oil prices.

Jordan has pegged its currency (dinar) to the US dollar since 1995. The Central Bank of Jordan’s readily available foreign exchange reserves remained at a comfortable level of US$ 15.2 billion at end of 2015, equivalent of 9 months of imports. Looking ahead, consumer and business confidence will remain constrained in the near term by the impact of regional turmoil and the effect of lower oil prices on regional liquidity.

Chart: Hong Kong total exports to Jordan
Chart: Hong Kong total exports to Jordan

Hong Kong-Jordan Trade

Total exports from Hong Kong to Jordan increased by 30.2% from HK$1,061 million in 2014 to HK$1,382 million in 2015. The top three export categories to Jordan were: (1) telecommunications, audio & video equipment (+118.5%), (2) textiles (+3.6%), and (3) office machines & computers (+23.1%), which represented 70.8% of total exports to Jordan.

ECIC Underwriting Experience

The ECIC imposes no restrictions on covering Jordanian buyers. Currently, the insured buyers in Jordan are mainly small and medium sized companies. For 2015, the number of credit limit applications on Jordan increased by 33.3%, while the amount of credit limit applications and insured business decreased by 2.6% and 2.4% respectively. Major insured products were textiles, footwear and electronics, which represented 99.6% of ECIC’s insured business on Jordan. The Corporation’s underwriting experience on Jordan has been satisfactory, with no claim payment or payment difficulty case reported from May 2015 to April 2016.

Content provided by Picture: Hong Kong Export Credit Insurance Corporation
Comments (0)
Shows local time in Hong Kong (GMT+8 hours)

HKTDC welcomes your views. Please stay on topic and be respectful of other readers.
Review our Comment Policy

*Add a comment (up to 5,000 characters)