04/06/2018

Jordan faces large-scale protests

Amman Skyline Xxxl

Over the past week, the Hashemite Kingdom of Jordan has witnessed large-scale street protests against IMF-backed austerity measures which include a proposed new income tax law and increases in electricity and fuel prices. Opposition websites and social media feeds abound with videos of largely peaceful demonstrations in both Amman and provincial capitals calling for the incumbent government of Prime Minister Hani Mulki to resign. Unfortunately for King Abdullah II, a simple change of cabinet will do little to remedy the underlying political and economic disenfranchisement of ordinary citizens.

The recent protests in Jordan have grabbed headlines partly because they have not been seen on this scale for some time. Unlike the Syrian and Egyptian regimes, the incumbent monarch King ‘Abdullah II of Jordan has not faced any serious challenge to his rule in the wake of the Arab Spring. A series of demonstrations for economic and political reform in 2011 and 2012, characterised by calls for an end to corruption, resulted in temporary concessions but no fundamental reshaping of the country’s political structure or its elites. Moreover, as the horrors in neighbouring Syrian began to unfold in subsequent years, many Jordanians became less inclined to risk opening old wounds and divisions in order to bring about political change. The difference in 2018, however, is that ordinary citizens are feeling the pinch in their pockets much more acutely than before. Unemployment is at 18%. And many have had enough.

Lacking any oil and gas resources, and heavily reliant on overseas aid, Jordan’s economy has been sharply affected by the influx of 1.4 million Syrian refugees into the country since 2011, as it was by the arrival of Iraqi migrants post-2003. The Gulf Corporation Council’s decision not to renew a five year financial assistance package to the Kingdom in February this year has further squeezed the state budget, which is currently running a deficit of GBP 40 billion and debt-to-GDP ratio of 95%. The interruption of gas supplies from Egypt since 2014 has cost the country an estimated USD 6 billion as it has shifted to other more expensive methods of electricity production.

Compounding these budgetary woes is a sharp divide between the haves and the have-nots in the country, which feeds the narrative of a corrupt elite detached from its citizens. The capital Amman encapsulates this asymmetry – a city of two halves split between the richer ‘West Amman’ with its expensive cafes, large mansions and foreign Embassies, and the sprawling districts of ‘East Amman’, where large sections of the population are increasingly struggling to stay above the breadline. In these areas, there is little belief that any rise in taxation of their wealthier compatriots will be of any tangible benefit to them via improved public services. The entrenchment of patronage networks and corrupt practices (known locally as “wasta”) has led to widespread cynicism towards the political class and little confidence that members of parliament are there to represent their interests.

To remove the sting of popular discontent, King ‘Abdullah has historically used his powers to dismiss his cabinet and swear in a new executive. This enables him to demonstrate he is listening to ordinary Jordanians and to appear neutral. This time, however, a cosmetic political reshuffle will do little in the face of declining wages and living standards. Even if the current protests fizzle out in the short-term, the country faces some turbulent months ahead.

Tom Ready

Associate Director

thomas.ready@aperio-intelligence.com