The Jordan Strategy Forum hosted Professor Zafiris Tzannatos, Senior Fellow at the Jordan Strategy Forum, a former official of several international institutions, and Chair of the Department of Economics at the American University of Beirut, to give an overview of the "Current Dynamics of the Jordanian Economy and Future Outlook", with wide participation from JSF members from the Jordanian private sector. The event was sponsored by Jordan Kuwait Bank and KbW Investments.

In her welcoming remarks, the CEO of the Jordan Strategy Forum, H.E. Nesreen Barakat, emphasized the Forum's ongoing commitment to analyzing and studying the impact of regional and global events on the Jordanian economy. She noted that this meeting with the private sector builds upon previous discussions held by the Jordan Strategy Forum with the Economic and Financial Committees in the Senate House and the parliament.

For his part, JSF member H.E. Abdelelah AlKhatib, who moderated the session, pointed to the importance of holding such meetings with the private sector to discuss its role in driving economic growth and development. He stressed the importance of effective partnerships between the public and private sectors to achieve desired growth in line with the Economic Modernization Vision. AlKhatib also underscored the pivotal role played by the private sector in employment, stimulating the business environment, and fostering innovation.

Professor Zafiris pointed out that despite the many challenges it has faced in recent years, Jordan has been able to maintain the stability of its economy, albeit at relatively low growth rates. The successive shocks, including the global financial crisis, the Arab Spring, the arrival of Syrian refugees, the emergence of  ISIS and the disruption of trade routes, the interruption of Egyptian gas supplies, the spread of the COVID-19 pandemic, and more recently the war in Ukraine and the war on Gaza, all have significantly affected the Jordanian economy in terms of high public debt, low investment rates, low value-added of economic activities, low productivity, and high unemployment rates.

Professor Zafiris duly recognized Jordan’s many efforts to keep the economy on a steady course through the introduction and revisions of its vision, strategies, plans, policies, and projects that have culminated in the recently adopted Economic Modernization Vision 2033.

Zafiris said that the private sector – the main engine of economic growth – still faces many structural challenges, especially the high public debt, pointing out that these challenges need to be addressed swiftly, so to avert their impact on various economic sectors as well as on unemployment. 

Looking forward, Zafiris said that there are assurances for debt sustainability till the end of the decade, given the implementation momentum of the Modernization Vision so far. Pointing out that though Jordan may still be affected by unavoidable external shocks such as geopolitical and regional tensions, further tightening of financial conditions, weaker global growth, renewed surge in commodity prices, lower international trade and investment and climate risks, pursuing consistently the remaining actions in the Modernization Vision will contribute further to debt reduction and reignite the potential of the private sector. 

Zafiris stressed the importance of ensuring adequate private-sector financing, particularly through public-private partnerships, and the crucial role of continued donor support in strengthening these efforts.

From a fiscal perspective based on the international experience, Zafiris emphasized the importance of avoiding reductions in public spending, which could lead to austerity with adverse impacts on the economy and people. He called for redirecting expenditures to areas with the highest economic and social returns, and rationalizing public spending, especially on pensions, electricity, and water, while optimizing revenue collection by taxing private sector production last.

During the meeting, Forum members engaged in an extensive dialogue with Professor Zafiris on current economic challenges and effective cooperation to achieve sustainable development. They discussed potential impacts on economic sectors such as tourism, industry, energy, water and climate adaptation, agriculture, technology due to global and regional economic fluctuations.