Background:

Fahd al-Fānik is a well-known Jordanian economist and financial consultant. He discusses the issue of the Jordanian economy, the situation of the poor and suggests a number of ways of tackling these issues.

Side A:

The Jordanian budget used to depend on foreign aid, dating to when the British ruled Jordan. Jordanian civilians were paying taxes for the civilian budget, and the British were paying for the cost of the army. This continued until 1956. Following that, Jordan depended on Arab aid from Syria, Egypt and Saudi Arabia who together gave 10 million British pounds. This agreement, however, did not last due to political disputes and only Saudi Arabia along with the United States continued to offer aid to Jordan. Arab aid became more important after 1973, when the oil prices doubled and thus, Jordan depended on the Gulf States once more due to lack of involvement from other Arab countries. Thus, Jordan had a lot of debt (approximately 8 billion dollars).

Besides the debt Jordan had, the people were also living under bad living conditions with shortages of resources, such as water. According to Fahd al-Fānik, Jordanians only had access to running water twice a week, having to live on stored water for the rest of the week. On the contrary, since the peace settlement with Israel in 1994, Jordan’s economy has been improving due to attraction of foreign investors. Jordan is much safer now, and the numbers of tourists have doubled.

With the emerging of the Palestinian state, Jordan was ready to establish holding companies in the West Bank and form these companies for investment, but the Palestinians were disappointed with their country as it is: still lawless, no police and no way of collecting debt. Al-Fānik believes that the investing will depend on Palestine’s future stability. In terms of Israel, Jordan is doing business with the nation, but faces some shortcomings in terms of real-estate. In Israel, it is forbidden to buy/own real estate as a foreigner, and therefore forbidden as a Jordanian to buy real estate in Palestinian areas. There is additionally, an agreement that states that Jordan’s products can be exported to Israel free of charge, the Israelis accepted the agreement provided that Jordan accepts the principles of free trade.

Side B:

Furthermore, al-Fānik stresses the issue of poverty in Jordan, which has decreased, yet the poorest 6% of the country are still suffering the most. Germany funds Jordan to help these people find jobs because a lot of them are poor not because they lack education, but because of the shortage of jobs available. Around 15.000 Jordanians have been funded with money to start their own businesses, which in turn will create more jobs for others as well. Additionally, charities in Jordan are also helping, but according to al-Fānik, the main way of improving the situation of the poor in Jordan is by increasing the salaries of government officials. There are many of government officials who have retired and are now living off heritage money.