Jordan will spend $2.3 billion over the next three years to improve infrastructure and living standards, with a series of projects planned including a seawater desalination plant it hopes will curb its recurring water crisis, the government said on Wednesday.
The proposed spending is part of a plan to revive the economy, made public two weeks after riots broke out in several parts of Jordan to protest against increasingly difficult living conditions. They were among the most deadly in the kingdom in decades.
Among projects in the “executive programme” of the plan, published by the government on its website on Wednesday, is a pipeline to supply Amman with water from a proposed desalinisation plant in the port city of Aqaba on the Red Sea.
Authorities were in discussions with Israel for years about supplying the kingdom with desalinated water but after disagreements between the two sides Jordan said last year it would construct a plant in the kingdom with western help.
Jordan has suffered from a host of environmental problems that have drained its underground water reserves, and it has had long-running disputes with Israel and Syria about sharing water resources. But Israel still provides Jordan with a major part of the kingdom's water needs.
A dedicated bus road in the capital Amman will be expanded and similar new roads will link Amman to Zarqa, Jordan's second city, and to Jerash in the north.
Spending will also go on plans for a proposed new administrative capital east of Amman, and on waste recycling and supplying industrial estates with natural gas.
The government described the programme as a “flexible live document” that will help achieve “sustainable development.”
It did not say how the $2.3 billion would be raised. Officials, however, have hinted that foreign aid will be a major source.
The government said last month that financing issues have delayed implementation of the economic reform plan, which it announced in June.
It aims to create more jobs, expand the middle class and raise living standards in the kingdom, but no projects have been introduced.
Jordan's economy has been stagnant for 12 years and unemployment is officially at about 23 per cent.
The 123-page plan forecasts doubling Jordan's gross domestic product to $82 billion over the next 10 years, with the help of $41 billion in unspecified funding and investment.
One million young people are expected to enter the workforce over this period.
A third of Jordan's 10 million population are under the age of 14 and overall income per head is $4,200.
The government expects 5 per cent inflation this year compared with 2 per cent last year. It describes inflation as relatively low compared with other countries.
But rising fuel costs prompted demonstrations and riots earlier this month, mainly in the southern governorate of Maan, where trucking is a main source of scarce, non-governmental jobs.
Four police personnel were killed before the unrest subsided.
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
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Six things you need to know about UAE Women’s Special Olympics football team
Several girls started playing football at age four
They describe sport as their passion
The girls don’t dwell on their condition
They just say they may need to work a little harder than others
When not in training, they play football with their brothers and sisters
The girls want to inspire others to join the UAE Special Olympics teams
8 traditional Jamaican dishes to try at Kingston 21
- Trench Town Rock: Jamaican-style curry goat served in a pastry basket with a carrot and potato garnish
- Rock Steady Jerk Chicken: chicken marinated for 24 hours and slow-cooked on the grill
- Mento Oxtail: flavoured oxtail stewed for five hours with herbs
- Ackee and salt fish: the national dish of Jamaica makes for a hearty breakfast
- Jamaican porridge: another breakfast favourite, can be made with peanut, cornmeal, banana and plantain
- Jamaican beef patty: a pastry with ground beef filling
- Hellshire Pon di Beach: Fresh fish with pickles
- Out of Many: traditional sweet potato pudding
Challenge Cup result:
1. UAE 3 faults
2. Ireland 9 faults
3. Brazil 11 faults
4. Spain 15 faults
5. Great Britain 17 faults
6. New Zealand 20 faults
7. Italy 26 faults
