Jordan

THE WORLD BANK estimated the poverty rate in Jordan in 1992 at 15 percent. More recent figures from the Economic and Social Commission of Western Asia indicated that in 1995 as much as 23 percent of the Jordanian population were considered poor. This poverty measure included a wide range of indicators, such as income, health, nutritional status, as well as school enrollment figures. Based on a 1997 Household Expenditure and Income Survey, the number of Jordanians living below the poverty line amounted to 523,000 in 1999.

A profile of the poor in Jordan during the 1990s and beginning of 2000 yielded the following characteristics. There is a high incidence of poverty among fe-male-headed households, which is attributed to the generally low education level among females, and in many cases the lack of a male provider. The risk of being poor is significantly higher for households where the head has no education than for households that have more than a secondary education. This is irrespective of whether the main provider in the household is employed or not.

Unemployed Jordanians constituted less than six percent of the poor, which highlights the fact that poverty is a problem of low family income rather than unemployment. When considering the marital status of the household head, being divorced is associated with a high risk of being poor. Divorcing often means that persons are disassociated from relatives as well as the immediate family. Households in the capital city of Amman generally have higher income levels than households in other regions.

Especially affected by the risk of poverty are camp refugees. Camp refugees and the displaced, groups made up mainly of Palestinians, have had to carry a burden of being poorer that is twice as high as for non-refugees, irrespective of education and employment status. That results from the fact that they have less wealth in the forms of savings and durable capital goods, and are more affected by economic recession since they work in the construction sectors that are very vulnerable to economic recession.

Jordan's economy has proven to be extremely vulnerable to external shocks. This was manifested on a number of occasions during the 1980s and 1990s. Jordan experienced an economic crisis in the late 1980s, leading to an overall decline in average incomes, a substantial increase in poverty, and worsening inequality. The Jordanian government responded to the economic crisis by implementing a structural reform program in order to enhance economic growth, reduce trade and fiscal imbalances, and protect the poor. A subset of the reform policies included the gradual elimination of general food subsidies such as bread, rice, and sugar. Despite the simultaneous adoption of some compensatory measures (target cash assistance), especially to protect the poor, the removal of food subsidies was widely believed to have caused greater hardship and to have increased poverty even further. Violent riots ensued in various cities and the police had to intervene in order to establish order.

Potential foreign investors remain extremely cautious of Jordan's geopolitical position because of its proximity to Iraq, the Palestinian territories, and Israel, and it is seen as a major liability. The imposition of sanctions on Iraq in 1990 severely constricted bilateral trade since, up to that point, Iraq had been Jordan's main trade partner. The Gulf War induced a large number of workers and their families to return from Kuwait to Jordan, along with repatriation of their financial assets. Growing demand for skilled workers in the Gulf attracted thousands of Jordanians to the benefit of Jordan through the receipt of remittances by families or savings accounts. Remittances from expatriate workers in the Gulf worth $1.3 billion in 1989 were drastically curtailed, and in the case of those in Kuwait (80 percent of the overseas workforce), stopped completely.

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