Hopes rest of export-led recovery
The International Monetary Fund and World Bank, the multilateral lenders that have both commit- ted funding to Jordan, see the economy’s recovery based on an export-based rebound. The IMF sees exports growing 4%-6% a year in the three years to 2021 in line with forecasts from the World Bank. The IMF used its April 2019 biannual forecasts to point to GDP growth of 2.2% in 2019 rather than the 2.7% pencilled in in October 2018. Activity is then forecast to accelerate to 2.4%, 2.6% and 2.8% in 2020, 2021, and 2022 respectively. However, six months earlier the IMF had looked for growth of 2.9% and 3.0% in 2020 and 2021. In its April 2019 economic forecast, the World Bank said the economy was constrained by structural impediments and a di cult regional environment. It expects GDP growth to increase by 2.2% in 2019 and by 2.4% in 2020. It said that this recovery was based on export-based growth that hinged on a restoration of macroeconomic stability, a support- ive external environment including o cial support, lower cost of generating energy, stable inter- national oil prices.
Relief for households as in ation hits zero
In ation slowed for the fourth month in a row to post zero price growth in March 2019. It was the lowest reading since de ation was recorded in October 2016. The IMF expects in ation to slow to 2,0% in 2019 from 4.5% in 2018 before rising gently to 2.5% by 2022. There was more relief for households as the Central Bank of Jordan has kept interest rates on hold since December 2018, when it raised borrowing costs by a quarter of a percentage point. The rise from 4.5% to an annual rate of 4.75% followed a similar increase in September 2018. The threat of higher prices sparked protests among households already struggling with the rising cost of food and other staples.