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French Version

Ministries of Planning and Trade get a reshuffling; Abul Ragheb set to take on the transformation

The King emphasized how economic reforms could be more effective if the government pursued a more socio-economic development strategy, endorsed nationwide, and integrated with all concerned economic and social endowments in the Kingdom.

Prime Minister Ali Abul Ragheb's indicates the changes being made at His Majesty King Abdullah's request will usher in a sweeping transformation for the local economy.

The appointment of new ministers for Planning and Trade and Industry posts surprised most economists and observers in the Kingdom who expected a change more in policy than in personnel. His Majesty's statements to Abul Ragheb earlier this month left little question about direction. The King emphasized how economic reforms could be more effective if the government pursued a more socio-economic development strategy, endorsed nationwide, and integrated with all concerned economic and social endowments in the Kingdom.

The King's letter emphasized his intent was to improve the Jordanian standard of living in 2002. This is an attempt to help the government secure socio-economic growth and financial stability.

Economists agree the latest changes are only the beginning of a long route to sustainable development. They agree previous economic reform programs in Jordan have failed thus far to establish a basis for a sustainable economic growth. "What Jordan needs is stable, highly evolved development policies to reinforce the economic reforms in the Kingdom," said economist Yousef Mansour, "This should be pursued through the implementation of development programs in different economic and social sectors to make the economic reforms more cost-efficient." Various reform programs have been implemented in Jordan since 1989. The programs were directly subject to the cabinet's financial and economic perspectives. Jordanians still remember the drastic consequences of the 1988 breakdown in the local economy. It forced the government to pursue a reformist attitude and resultant reform programs. This is unlikely to happen again in the foreseeable future. "Reform programs are good for the government to know what it has to do. But these programs did not provide a comprehensive revision of the public expenditures and projects the government conducted throughout the Kingdom," Mansour explained.

Accordingly, public expenditures in the last 10 years have gradually increased 70 percent since the 1980s. The poverty rate has witness a similar trend through this same period.

The appointment of the Royal Court's economic chief, Bassem Awadallah, as Minister of Planning is seen as an attempt to ensure the government follows the King's steps. Awadallah is also known as an advocate of the private sector. The replacement of Wasif Azar with Salah Aldain Bashir as Minister of Industry and Trade will help Abul Ragheb fortify legislative adjustments and make economic reforms and investments more applicable. Bashir, a lawyer, was one of those who paved the way for Jordan's membership in the World Trade Organization and the establishment of the Aqaba Special Economic Zone. Recent studies indicate previous economic reform programs ignored the significance of social development in the rural areas, a fact that yield uneven growth in the Kingdom. Focus on this paves the way for a private sector role in the socio-economic development. "The private sector has the will to employ its money in local investments. But this should be made on a clear basis," said Hamdi Al Tabba, chief of the Jordanian Businessmen Association. Al Tabba noted the recent $3 billion projects introduced by the government two weeks ago held great potential for the private sector. What makes the latest changes more significant is King Abdallah urged the government to be more open and transparent towards its objectives.

This will inevitably force Abul Ragheb to pursue a national mandate, and make all the economic sectors partners in the re-building of socio-economic development.

Similar to Al Tabba, economists agree Abul Ragheb's cabinet still does not have specific procedures for the transfer of government-led institutions to the private sector. "The King has already drawn up a path for the government. I believe the premier needs to follow these steps carefully," said Munir Hamarneh, professor of economics at the University of Jordan.

He told The Star the challenges facing the economy are enormous and the government must be careful of any step it makes toward this end. Economists agree privatization is a very significant part of any economic recovery. Hamarneh wants the government to revise the privatization polices currently in place. "Governments in developing countries like Jordan must have flexible policies towards their private sectors. This circumstance grows more and more pressing for the Kingdom." Abul Ragheb's recent trip to Japan to restore aid originating in Japan International Corporation Agency (JICA) has been embraced but Hamarneh views foreign involvement in the Jordanian economy with some suspicion.

Hamarneh is wary of Abul Ragheb's optimism in attracting more and more foreign investment to try and wake up the sluggish economy in Jordan as an example. "The next step for the government is to draw up a plan to re-invest the revenues of privatized institutions for the betterment of the economy."

Ghassan Joha
The Star

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