Jordan’s Prime Minister Omar Al Razzaz has identified tackling youth unemployment as a priority as he embarks on the second year of a five-year economic programme targeted at stimulating his country’s economy.
In an interview with The National in Davos, Mr Al Razzaz said he had a clear message for the annual meeting of the World Economic Forum: "Jordan is a resilient country, politically and economically, with investment and growth in spite of the troubled neighbourhood that we live in."
Jordan has traditionally been one of the most active Arab countries at the forum and often hosts a regional conference with the WEF. Although Jordan’s King Abdullah II was not at Davos this year, Mr Al Razzaz arrived with a delegation focused on economic growth.
After taking a number of measures to deal with domestic economic woes, the Jordanian prime minister said the kingdom was “really committed” to economic reform and expansion.
“We came here to Davos to tell our partners that this programme is owned by Jordanians and we are starting to see the results … we want to be accountable to our public, especially our youth and our partners.
“We started with a very specific action plan for getting the economy moving again. It started with all sorts of structural reforms that had to do with the business environment, infrastructure, including female labour participation, making our energy sector more efficient. We now have results to show after the first year of a five-year plan."
These measures include taking more advantage of existing free trade agreements, including with the United States, exempting land transactions and apartments from some taxes, and supporting small and medium enterprises.
The number of tourist visitors is up by 10 per cent after low cost airliners were brought in; the IT sector has grown by 11 per cent after companies were exempted from new taxes, with business process outsourcing growing by 47 per cent.
“We are now exporting to 120 countries around the world, with exports as sophisticated as pharmaceuticals and as simple as food products, all this range is based on talented human capital,” Mr Al Razzaz said.
And yet the challenges are substantial, especially with Jordan’s debt to GDP ratio among the highest in the world, at more than 92 per cent compared with the IMF target of 88 per cent.
“The IMF itself recognises today that its own projections for Jordan, regional and global growth were exaggerated," said Mr Al Razzaz. "The IMF has revised its own projections and part of the Davos discussion is how we are witnessing a slowdown across the world, and extreme slowdown in our region due to its circumstances."
One of the key issues facing Jordan, he said, is “how do you keep your deficit in check and at the same time stimulate your economy, because our economy is shrinking. It means we have to spend more but spend carefully, so we can create a virtuous circle.”
However, these measures take time to make a direct impact. People on the street are yet to feel it in their pockets, something Mr Al Razzaz is aware of.
“It has been more than a decade for the average Jordanian citizen where he has not seen a real improvement in income and quality of life. They need to feel something tangible even if it is modest, and at the same time see the structural changes that need three, four or five years,” he said.
Public sector wages were raised, but more work remains to be done.
“Youth unemployment is the target; that is Jordan’s most important resource and if we are not deploying it well and correctly, that is a major failure," the prime minister said.
“The hardest part is creating jobs for youth. We are creating incentives for investors, because that is a real sustainable way of creating employment, but we are also encouraging youth to start their own companies." Regulation has been put in place to allow for working from home, in addition to vocational training coming in to help build skills of young people. A new six-month programme called Khidmat Watan [National Service] has been introduced for Jordanian youth to pick up important skills."
Last year, Jordan witnessed teacher strikes that led to weeks of disruption and a government reshuffle. As a former education minister, Mr Al Razzaz was heavily involved in the negotiations with the teachers’ union.
“There is a political and educational aspect to it. On the education front, government recognised that we need a different system for the career path of teachers – it didn’t reward them in the right way.
“We have a Jordan teacher’s union and Jordan takes professional unions seriously, we have a political system that allows political unions and political parties and that has been one of the strengths of Jordan.”
Jordan is one of the few Arab countries that has witnessed protests without bloodshed, nor state violence to suppress them. Mr Al Razzaz is proud of that record. “When youth come out and they say we want jobs, they are not being disloyal, they are expressing a sincere desire for something; we should be working with them, not against them. Our security forces have that critical role to play in allowing them to express their views and freedom of speech is enshrined in our constitution, so we respect that, but we also want to make sure that major intersections are not blocked, etcetera.
“I salute our security forces for being extremely self-restrained. Not a single bullet, not a drop of blood, fortunately. That requires a lot of restraint and a lot of understanding that all of our security forces are essentially there to protect our people and their right to express their opinion.”
Jordan also has to contend with instability in the region, especially with the continued Israeli occupation of Palestine. “His Majesty the King last week in his address at the EU was sounding the alarm bell about the serious risk that, if a two-state solution is undermined to a point where it is no longer feasible, we are thrusting not just the Middle East but the whole world into more conflict, and that conflict will affect peace and prosperity in the region. We live in a global village, there is no isolated effect.”
The prime minister was vocal in his concern over the developments in Palestine and Jordan. “Just because reaching a two-state solution and giving Palestinians their own state with their capital in Jerusalem is difficult to achieve, it doesn’t mean we turn our backs and look at secondary issues in the region and elsewhere. Nor should it mean that we allow the unilateral measures that have been taken by Israel to go on.
“These measures and the facts they create on the ground, if they are allowed to go on, they are closing the door to a two-state solution and opening the door for an apartheid state that includes Palestinians at best as second-rate citizens. This is no road to peace," he said.
“We see short-termism; tactics about solving the Palestinian issue by reducing Palestinian political aspirations to finance. This will not happen and will not lead to peace."
Political compromises are vital to stabilise the Arab world, Mr Al Razzaz said.
“In Jordan sometimes we feel like we are just repeating ourselves in calling for political settlements, bringing all stakeholders around the table to reach political compromises. This applies not only to Syria but every country in the region that is witnessing this strife, most recently in Libya.
"The less respect we have for countries’ sovereignty, the less respect for territorial integrity and the more we undermine these countries by regional and global interventions that support one group against the other, the more we are going down a dark tunnel.”