IMF Staff Concludes Visit to Jordan
IMF News, March 15, 2017
Source details
- Canonical URL
- IMF Staff Concludes Visit to Jordan
Other formats
Bibliographic details
- Published: March 15, 2017
Mission summary
- A team from the International Monetary Fund (IMF) led by Martin Cerisola visited Amman from March 5-9 to take stock of recent economic developments and discuss planned economic policies for 2017 and beyond.
- End-of-Mission press releases convey preliminary findings after a visit; views expressed are those of IMF staff and do not necessarily represent the views of the IMF’s Executive Board.
- This mission will not result in a Board discussion.
- It was agreed that discussions will continue during the Spring Meetings in Washington, DC, with a view to complete the review of the Extended Fund Facility.
Macroeconomic performance and outlook
- Growth is expected at around 2.0 percent in 2016.
- Growth is expected to pick up modestly in 2017, driven by some rebound in exports, tourism, and remittances.
- Unemployment increased to 15.3 percent.
- Inflation has accelerated to 2.5 percent (year-on-year (y/y)) in January and to 4.6 percent (y/y) in February, reflecting higher global food prices and the one-off impact of the fiscal measures.
- Credit to the private sector increased by around 10 percent y-o-y in December 2016.
Fiscal stance and public finances
- The overall fiscal deficit is estimated at 3.6 percent of GDP in 2016.
- The fiscal deficit is projected to decline to less than 3 percent in 2017 in light of fiscal measures underpinning the 2017 budget.
- Fiscal measures had a one-off impact on inflation.
External position and reserves
- The current account deficit is expected to reach 9.5 percent of GDP in 2016 compared to 9.1 percent in 2015.
- Recent data suggest a recovery in remittances and tourism, which could contribute to reduce the current account deficit in 2017.
- Recent steps by the Central Bank of Jordan in raising key monetary policy rates have helped to preserve the attractiveness of the Jordanian dinar and keep international reserves at adequate levels.
Policy discussions, risks, and recommendations
- The conflicts in Syria and Iraq continue to weigh on Jordan’s economy and constitute a major external risk.
- The pressure from refugees on the economy merits continued support from the international community.
- Authorities reiterated their commitment to sound policies that reduce vulnerabilities and support growth.
- Discussions focused on:
- Taking stock of recent developments and exploring changes to the macroeconomic framework.
- Authorities’ plans for policies and reforms to preserve macroeconomic stability and to enhance growth and employment prospects.
- The IMF is committed to maintaining its dialogue with the authorities and supporting Jordan’s national program of economic reforms.
Key statistics (as reported)
- Visit dates: March 5-9 (year of visit reported in release).
- Press Release No.: 17/83.
- Growth (2016): around 2.0 percent.
- Unemployment: 15.3 percent.
- Inflation: 2.5 percent (y/y) in January; 4.6 percent (y/y) in February.
- Fiscal deficit (2016, overall): 3.6 percent of GDP.
- Fiscal deficit (2017 projection): less than 3 percent of GDP.
- Current account deficit (2016): 9.5 percent of GDP.
- Current account deficit (2015): 9.1 percent of GDP.
- Private sector credit growth: around 10 percent y-o-y in December 2016.
IMF Press Release No. 17/83, March 15, 2017.