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2018 Annual Assessment

This year an economic crisis forced Jordan’s Prime Minister Hani Mulki to tender his resignation to King Abdulla II (June 4, 2018), in order to quell public protests against the economic reform Mulki had attempted to introduce. The reform was an International Monetary Fund condition for extending Jordan the credit it needed. At the end of Ramadan (May 31, 2018), people took to the streets throughout the kingdom and called for a general strike to protest tax hikes and higher prices for basic goods. In an unusual move, the Bedouin tribes loyal to the government took part in the protest, which was led by the trade unions (and not by members of the Islamic Brotherhood, as such protests usually are).

Over the years of war in Syria, Jordan was obliged to absorb 1.4 million refugees, who now account for 13 percent of the kingdom’s population. They are a burden on Jordan’s fragile economy and a source of instability. The refugees from Syria were preceded by hundreds of thousands of refugees from Iraq. Nearly 20 percent of Jordan’s budget is now dedicated to hosting refugees within its territory. The Jordanian economy is also suffering due to restrictions on trade with its neighbors, countries mired in violent internal conflict (though stabilization could potentially allow trade to resume with Syria which, before the civil war, accounted for over 50 percent of Jordan’s foreign trade). Tourism – a major component of the Jordanian economy – has sharply declined due to a perceived lack of security in the region. The supply of discounted gas from Egypt was interrupted by attacks on the Sinai pipeline, forcing Jordan to resort to more expensive alternatives. These issues are exacerbating more deeply-rooted problems with the Jordanian economy: a bloated public sector, the fact that only 36 percent of all working-age Jordanian citizens are actually employed, a female employment rate of just 15 percent, and a young-adult unemployment rate of 40 percent.

Alongside the economic woes and social unrest, the Jordanian regime faces security challenges that originate outside the country’s borders: terrorism, spillover of the Syrian civil war into Jordanian territory, and now – the danger that, in the wake of the arrangement coalescing in Syria, hostile Iran-backed forces will, under Syrian auspices, approach the Jordanian border. The Jordanian regime also has to contend with locally-based radical Islamic groups, as well as the fact that over half the country’s population is of Palestinian origin and influenced by the vicissitudes of the Israeli-Palestinian conflict.

Jordan’s fragility and the threats it has to cope with are pushing it into deeper cooperation with Israel, with an emphasis on security and intelligence (Netanyahu met with King Abdullah II in Amman on June 18, 2018). The two countries’ shared interest in maintaining cooperation proved helpful in settling the July 2017 incident in which an Israeli security guard shot and killed two Jordanian citizens. There is meaningful cooperation between Israel and Jordan in the energy sphere as well: an agreement signed on September 26, 2016 specifies the provision of $10 billion dollars’ worth of Israeli gas to Jordan over a 15-year period.

Jordan is concerned about the ramifications of the Israeli-Palestinian diplomatic stalemate for its own stability. Jordan is also worried that the American peace plan will undermine its special role in the East Jerusalem Islamic holy sites – a factor behind its negative reaction, alongside that of the Palestinians, to Trump’s decision to move the embassy to Jerusalem.