Jordan, monarchy and government in trouble
Demonstrations have toppled the government. The new government is trying to listen to the people, amid pressure from the IMF and major migrations
- Wednesday, 03 April 2019
The IMF's intervention, the exponential increase in the number of refugees from Syria and Iraq and the law on cyber-crime: these are the three main issues that risk pitching the Hashemite monarchy into the quagmire. The call for structural reforms with a view to redressing the public debt is becoming increasingly urgent for the realm, which has had to reckon with the numerous street uprisings triggered by the rising prices of raw materials and the need to protect the freedom of the press, endangered by the amendments to the law on cyber-crime put forward by the previous government and now withdrawn by the new one.
Omar Razzaz, the current prime minister in power since June 2018, is having to weather the consequences of the choices made by the previous government. Criticised from the outset for having included 16 members of the Hani Mulki government (which ran the country for 2 years) in his 28-strong team of ministers, in October, just a few months after taking office Razzaz decided to reshuffle his cabinet by creating a new ministry and merging a number of others. By appointing 7 women at the head of important ministries (including the Ministry of Communication, now run by Jumana Ghunaimat, the government's spokesperson) Omar Razzaz has set a record for the number of women in positions of power in the history of Jordanian governments. However, this drive towards innovation has not gone as far as introducing the much hoped-for changes on the economic front, where a stunted rate of growth that for years has stood at around 2% - never rising above 2.4% - is compounded by the presence of the IMF officials which also weighs heavily on internal policies. These factors have been picked up by the opposition forces that has been accusing the recent governments of gross incompetence in the management of the economic crisis. In September 2018 the country's public debt stood at 96.2% of GDP, having risen by 2 more points the previous year; unemployment is at 18% and the young and women worst off, while inflation stands at 4.5%. This extremely tricky social and economic outlook creates tension within a country that has other plenty of other issues to deal with. For one its neighbours – mainly Syria and Iraq – certainly don't contribute to the realm's stability.
Among the various measures introduced under the guidance of the IMF in order to lower costs, the Hani Mulki government cut the bread subsidies and increased VAT. The population poured into the streets to protest these imposed austerity measures. Recent meetings in Washington between the representatives of the new government and the IMF have reshaped these actions and as a result VAT in now 4 points lower on essential goods that are taxed at 10% and 16%, such as pasta, cheese, fruit and vegetables, tinned fish and meat. Initially the Razzaz government had introduced a series of medium term reforms to improve resource management, the country's level of competitiveness and an appropriate level of international monetary reserves.
Over the course of the next 5 years Kuwait, the United Arab Emirates and Saudi Arabia will pour 2.5 billion dollars of aid into Amman's coffers for its handling of the migration crisis, which has depleted the realm's reserves. The EU, Jordan's most important trade partner (in 2017 it accounted for 17.4% of the total, ahead of the US (13.4%), Saudi Arabia (13.4%) and China (10.9%)), has simplified the exportation of the realm's products with the possibility of receiving goods not just from the 18 Free Trade Areas foreseen by the agreements, but from the entire country and especially from companies that employ Syrians in their workforces. This incentive will be triggered once 200,000 Syrian workers will have been introduced to the Jordanian labour market. Trade relations between Jordan and the EU are managed by the Association Agreement of 2002 that set out a free trade area for Jordanian and European goods. It identified 18 Special Economic Zones for the origin of the realm's products. In 2016 the agreement was upgraded, simplifying the rules of origin for Jordanian goods exported to the EU. In December 2018 the Jordan-EU initiative was expanded further and now expires in 2030 and covers a vast range of products. Once again, a matter connected to the biblical migration from the north influences the country's social and economic policies.
According to the UNHCR, Jordan hosts 1,400,000 Syrian refugees. The numbers speak for themselves; updated to December 2018, the registered refugees are 671,148, with the Amman governorship hosting 196,597. The refugees currently in camps managed by the government and the UNHCR are 126,064, while those unregistered and not staying at UN/government facilities are another 545,084. These numbers provide an immediate indication of the kind of humanitarian effort Jordan has had to face, with its own population hardly reaching 10 million. To promote their inclusion within the country's economic fabric, in 2017 Amman issued 46,000 work permits to registered Syrians, and approximately 45,000 in 2018.
The Global Trends document produced by the UN Refugee Agency explains how Jordan is the country that hosts the tenth largest refugee population in the world, preceded (from first to last) by Turkey, Pakistan, Uganda, Lebanon, Iran, Germany, Bangladesh, Sudan and Ethiopia. The case of Jordan is even more striking if we look at the population/refugee ratio: in this ranking Jordan is second in the world – preceded by Lebanon and ahead of Turkey – with 71 refugees for every 1000 inhabitants. In Lebanon there are 164 refugees every 1000, and 43 in Turkey. Over the course of history Jordan has welcomed refugees from Palestine (1948), Iraq (2003) and Syria since 2011. According to the Foreign Minister Ayman Safaid Jordan has already spent 10 billion dollars hosting Syrian refugees alone, with an even greater sum weighing on its shoulders once the US, as President Trump has announced, cuts its funding of the UNRWA, the UN Relief and Work Agency for Palestinian Refugees.
In addition to the economic front, the street protests that led to the Mulki government's fall showed the people's opposition to the review of certain parts of the law on cyber-crime which, if implemented, could restrict the freedom of the press. In December 2018, when meeting with journalists, Jumana Ghunaimat, the Razzaz government's spokesperson, explained that the new government was not going to push through the changes to the law given the obvious discontent among the population and after a series of meetings the prime minister had with members of the civil society and labour representatives.
The ill feeling hinges on proposals that would increase sanctions and expand the range of application of so called hate speech legislation. One of these defines hate speech as "any statement or deed that is likely to fuel subversion of a religious, sectarian, ethnic or regional nature". The provision also calls for an increase in the length of jail sentences, from the current week to between 3 months and a year, as well as hiking fines from 700 to 1,400 dollars. The government, Ghunaimat explained, will reassess the judicial process for crimes classified as hate speech and those for the spreading of fake news. Article 11 of the law on cybercrime will therefore be emended to align with the Jordanian Constitution and international standards.
King Abd Allah II plays a fundamental role in stabilising the country and the image it portrays abroad. Jordan is an important player in the region, as it maintains relations with Israel and is making diplomatic overtures towards Syria now the borders have reopened. Saudi Arabia still has plenty of influence on the Hashemite monarchy, even though at this point in time relations are not so warm following Mohammad bin Salman's decision to back the US peace plan for Palestine. The International community cannot afford further turbulence in the Near East, especially in Jordan, that stands as a crucial link between the Arab world and the West, as an EU and US partner, and has played a major role in halting the advance of the Islamic State.
This article is also published in the March/April issue of eastwest.