Standard Chartered puts Jordan’s expected growth at 3.5% in 2009, compared to 5.2% in 2008 (annual growth between 2004-2007 was high at above 6%). Long known for its political stability and strong leadership, Jordan has seen massive investment in the real estate and tourism sectors of late. Moreover, investment has been one of the key drivers of Jordan’s growth, due primarily to improved investment laws. To that extent, the Gulf states and affluent Iraqis have invested heavily in the real estate and tourism sectors. In fact, investment is the second largest contributor to GDP. And while the nation’s current account deficit is the main concern, the bank noted, said deficit is expected to ease in the coming year given that over 20% of the import bill is from oil and that Jordan is the 23rd largest importer of wheat in the world. Finally, while remittances may slow due to a global slowdown, they are likely to remain relatively strong. However, Jordan’s largest export partner is the United States, and demand for its top export (clothing) will naturally wane.

One popular sector to invest in may be financial services. Business Intelligence Middle East notes:

[Jordan’s] banking sector is strong due to the conservative management by the central bank. Supervision has been key. Non performing loans (NPLs) are low, 4% of total loans, liquidity ratio is at 138%, and the asset to deposit ratio is less than 80%.

Jordan’s government can be commended for its foresight during the recent boom years, from 2004-2007, when annual growth was around 6%. Privatization, the reduction of foreign debt, and the elimination of fuel subsidies will help the nation’s economy as global economies begin to recover from the financial credit crunch. That said, its fiscal expansion in light of a budget deficit (budget spending will be up by 18% in 2009 and includes a 36% increase in the monthly minimum wage) will keep its deficit from shrinking.

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