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Jordan

Last updated: February 23, 2023
The Hashemite Kingdom of Jordan is located in the eastern Mediterranean, but has only a narrow 26-kilometer-long sea access to the Red Sea in the Gulf of Aqaba. Jordan borders Israel and the Palestinian Territories to the west, Syria to the north, Iraq to the northeast, and Saudi Arabia to the south. The country is about four times smaller than Germany.  With a population of nearly eleven million, Jordan hosts about 675,000 Syrian refugees, according to the UN Refugee Agency (UNHCR), making it the second-highest per capita refugee population in the world after Lebanon. In addition, Jordan’s history has been marked by hosting refugees from the Palestinian territories, Iraq, Kuwait, and Yemen. The capital, Amman, is located in the northeastern part of the country.
In 1999, His Majesty King Abdullah II succeeded his late father King Hussein on the throne. Through political reforms and economic liberalization measures, most recently the new Political Parties Law and the Jordan 2025 National Vision and Strategy, Abdullah II initiated a transformation of the national economy and opened it to the world market.
Jordan’s foreign policy is shaped by both its Arab neighborhood and its historically Western orientation. It is a member of the UN and the Arab League, as well as the World Trade Organization (WTO) and the Greater Arab Free Trade Area (GAFTA). An association agreement with the EU has been in effect since 2002. Along with Morocco, Tunisia and Egypt, Jordan is also a party to the Agadir Agreement, a free trade area that aims to synchronize rules on product standards and tariffs and eliminate all trade tariffs between signatories.
In 2020, Jordan had the second largest International Finance Corporation (IFC) investment portfolio in the Mediterranean and Middle East region, aiming to strengthen private sector engagement and job creation through direct investment, public-private partnerships, and major business climate reforms.
The Jordanian economy has a strong services sector; its share of GDP is constant at 66.6 percent, generated primarily by tourism, banking and financial services, and IT. Tourism has gone through a period of diversification (cultural tourism, health tourism, ecotourism, and adventure vacations). Reforms and academic cooperation programs have paved the way for a knowledge-based economy; for example, political activity is now allowed for students. The manufacturing industry (28.8 % of GDP) is concentrated primarily in the textile industry and the construction and chemical sectors. Several laws aim to facilitate the privatization of the water sector. Characteristic of all industries is that small and medium-sized enterprises (SMEs) generate most of the economic output in the private sector.
Jordan’s main exports are fertilizers, calcium phosphates, packaged medicines, clothing and apparel, and phosphoric acid. The main imported goods are automobiles, refined petroleum, natural gas, crude oil, and clothing and apparel. The Jordanian economy is heavily dependent on foreign investment. The country offers interesting business opportunities in a politically stable environment and an investment-friendly atmosphere. Investors benefit from stable exchange rates and relatively moderate inflation rates.
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