The Crisis in Jordan: Political and Economic Implications

Thursday, June 14, 2018

Featuring

Imad K. Harb
Director of Research and Analysis, Arab Center Washington DC

Joe Macaron
Resident Fellow, Arab Center Washington DC

Aaron Magid
Middle East analyst and journalist for Foreign Affairs, The New Republic, and Al-Monitor

Khalil Jahshan – Moderator
Executive Director, Arab Center Washington DC

 

Event Summary

Washington, DC—June 14, 2018—Over the last two weeks, the Hashemite Kingdom of Jordan has seen widespread protests, with thousands of Jordanians flocking to the streets from Irbid to Amman to Aqaba. The protests, which brought down the sitting prime minister and led to the formation of a new government, were a response to a more pervasive underlying crisis that has long plagued the country. Arab Center Washington DC (ACW) held an in-house briefing on the crisis to assess its political and economic implications. Panelists were ACW’s Research and Analysis Director Imad Harb and Resident Fellow Joe Macaron, along with Aaron Magid, a Middle East analyst and journalist for Al-Monitor. ACW Executive Director Khalil E. Jahshan offered opening remarks and moderated the discussion.

“Jordanian governments, successive ones, have been better at crisis management than at resolving the inherent issues or difficulties that contributed to previous crises.” — Khalil Jahshan, ACW

Aaron Magid led off the discussion with a survey of the economic situation in Jordan at present. He then explored the political and regional elements of Jordan’s internal conflict. “The economic challenges” facing average Jordanians are “great,” Magid said, noting that “fuel prices have risen five times over the course of 2018; bread prices have doubled; [and] you have unemployment at about 18 percent, according to official stats.” Amman’s rising costs, lack of resources, inflated spending, and limited sources of revenue are all aspects of a fundamentally flawed economic structure, Magid explained, one that must be reformed if Jordan is to avoid becoming insolvent. He opined that among Jordanians, “there is deep distrust towards…the political apparatus.” Despite all these problems, Jordan’s neighbors and other actors with influence in the region have vested interests in maintaining Jordan’s stability, Magid said, and could lend a helping hand to King Abdullah II.

“For many Jordanians who are working—and they are working, whether at a government job or not a government job—they just can’t make it.” — Aaron Magid, Analyst

Joe Macaron provided the broader historical context for Jordan’s current crisis, observing that four challenges persist for the government in Amman: demographics, a lack of resources, geography, and the legitimacy of the monarchy. Macaron stated that since the era of King Hussein, the ruling family has manipulated the economic institutions of the kingdom to balance competing interests and maintain monopoly on power. Many of the ruling family’s efforts at ensuring loyalty throughout the country were designed to ensure that different groups—on which the royal family depended—benefitted from wealth the government had accumulated; this has now resulted in a bloated public sector that has directly contributed to the economic struggles that sparked the most recent demonstrations. Essentially, Jordan’s rulers have been willing to jeopardize the health of the economy in order to curry favor with competing power bases in the kingdom. Macaron said that the Jordanian economy must undergo significant reform to alleviate the problems and reduce public debt, but he added that “successive governments since 1989 tried to…avoid the difficult decision of cutting the size of the [Jordanian] public sector.” Going forward, Macaron argued, the protests could have wide-ranging impact on the government’s ability to reform the economy, saying that a public backlash would hinder the International Monetary Fund’s attempts to press Amman for much needed economic reforms. Present and future Jordanian governments, he said, could simply try to manage the crisis now and hope for positive regional developments that would provide the kingdom with the breathing room it needs—as long as such developments would not require undertaking controversial economic reforms.

“There’s an old saying that Jordan is caught between Iraq and a hard place and this is the reality of Jordanian regional policies.” — Joe Macaron, ACW

Imad K. Harb concluded with his assessment of Jordan’s foreign policy positions in light of its internal political and economic crises because, saying that “foreign policy originates in domestic politics.” Harb described four policy “circles” in which Jordan exists: its relationship to the Palestine cause and role in maintaining Israeli security; its role in managing the fallout of the Syrian war; the indirect effects of the ongoing Gulf Cooperation Council (GCC) crisis; and Jordan’s involvement in the global “war on terror.” All of these circles influence Jordan’s relationships with its neighbors in the region and the international community more broadly. As long as Jordan depends on outside aid to survive, Harb deduced, its foreign policy decisions will be heavily influenced by this overarching need.

“Jordan, as the typical rentier state … really depends for a lot of its economic well-being on rents, and the GCC countries have been providers of [that] aid.” — Imad Harb, ACW

Event Photos