Jordan

In-depth country-focused analysis on Jordan's economic, political and operational risk environment, complemented by detailed sector insight

Jordan

Our comprehensive assessment of Jordan's operating environment and the outlook for its leading sectors are formed by bringing together a wealth of data on global markets that affect Jordan, as well as the latest industry developments that could impact Jordan's industries. This unique integrated approach has given us an impeccable track-record for predicting important shifts in the markets, ensuring you’re aware of the latest market opportunities and risks in Jordan before your competitors.

Country Risk

Jordan Country Risk

BMI View:

Core Views

  • Jordan's political risk profile remains intrinsically connected to the region's security outlook. Threats to the country's stability will remain elevated as long as the fighting in Syria and Iraq continues. Domestically, high youth unemployment and the government's uncompromising approach towards the Jordanian Islamist opposition raise longer-term risks, with this trend exacerbated by the large influx of Syrian refugees in the country.

  • We are more positive towards the Jordanian economy than at any point since 2010, with lower oil prices and signs of progress on the government's infrastructure investments set to boost economic activity throughout 2015. We forecast real GDP growth of 3.6% this year, compared to an annual average of 2.7% between 2010 and 2013.

  • We believe that the Central Bank...

To read the full article Register for Free or Login

Jordan Operational Risk Coverage (9)

Jordan Operational Risk

BMI View:

BMI View: Jordan's labour force is, on the whole, well educated and highly urbanised with a high level of primary education and literacy. Investors will find a readily available pool of skilled and semi-skilled labourers who are cheap to hire and fire. However, key sources of risk include high levels of unemployment, which may encourage social unrest if sustained, and low levels of female participation in the workforce. Taking these factors into account, Jordan scores 54.5 out of 100 in BMI's Labour Market Risk Index. It ranks sixth out of 19 countries in the MENA region, behind...

To read the full article Register for Free or Login

Jordan Crime & Security

BMI View:

With a negligible murder rate of between 1 and 2 per 100,000, and an effective and low corruption police force, Jordan proves to be a low-risk country for investors. Yet despite Jordan possessing very effective intelligence and counter-terrorism agencies, risk does remain in the form of high terrorist threat. In spite of this, Jordan is one of the safer countries in MENA and the Arab world, with the country attaining a security risk score at a low 48.2 out of 100, placing it 83 rd in the world. Regionally, Jordan figures quite highly as it is only bettered by the Gulf states, and thus exceeds all of its neighbours with the exception of Saudi Arabia.

Crimes like robberies and assault appear low but these are potentially opaque, as Jordan, along with several other Arab countries, recognises a process called otwa whereby families resolve disputes among themselves, with minor governmental oversight. This could...

To read the full article Register for Free or Login

Jordan Labour Market

BMI View:

Jordan's labour force is, on the whole, well educated and highly urbanised with a high level of primary education and literacy - even in rural areas. Investors will find a readily available pool of skilled and semi-skilled labourers who are cheap to hire and fire. Jordan scores 53.7 out of 100 overall for Labour Market Risk. At 66 th in the world and just behind Mexico, Jordan ranks 6th within MENA, behind Israel and the GCC only (with the exception of Kuwait and Oman). Regionally, Jordan figures highly. Jordan betters two of its neighbours (Syria and Iraq) in every aspect, with a higher availability of labour score than Saudi Arabia and one of the highest educational scores in the region.

While women show higher rates of university enrolment than the regional average, they continue to be relegated to mostly domestic roles. Another negative aspect of Jordan's labour force is the so called brain-drain effect, as many of the more...

To read the full article Register for Free or Login

Jordan Logistics

BMI View:

BMI View: Jordan's geostrategic location and fairly well-connected road and port networks ensure ready access to major regional and international markets, representing a crucial advantage to businesses based in the country. Trade activities are further reinforced by an efficient trade bureaucracy and governance system, though export procedures are considerably more competitive in terms of costs and document requirements than import procedures. However, planned airport, port and railway infrastructure upgrades will be necessary to preserve Jordan's competitiveness vis-a-vis strong logistics competitors in the region, notably in the Gulf Cooperation Council (GCC). Although Jordan...

To read the full article Register for Free or Login

Jordan Trade & Investment

BMI View:

BMI View: Jordan's open economy, stable political regime and welcoming attitude to FDI make the country an increasingly attractive investment destination within the highly unstable MENA region. The country has enacted a number of business-friendly reforms over the last two decades, lowering barriers to trade, removing caps on foreign ownership, and improving bureaucratic and legal procedures. Investors will also be enticed by low tax rates and generous incentives. Nevertheless, we caution that a number of obstacles continue to cloud the operating environment. Chief among these are lingering concerns over corruption, which hinders bureaucratic and judicial efficiency. In addition, the availability of credit remains constrained by...

To read the full article Register for Free or Login

Jordan Industry Coverage (7)

Autos

Jordan Autos

BMI View:

BMI retains a negative near-term view on the new vehicle sales outlook for Jordan, Lebanon and Syria. This reflects the deteriorating regional economic and political situation. We are now targeting falls in auto sales for all three countries over 2015.

Starting with Jordan, BMI retains a downbeat stance towards new vehicle sales this quarter, as we feel that the growing threat to the Kingdom's borders from ongoing attacks from Islamic State (IS) insurgents more than outweighs what is a reasonably propitious domestic macroeconomic backdrop.

According to an April 2015 report by the Associated Press (AP), ongoing border violence has led to the closure of the sole Syria-Jordan trade crossing, effectively paralysing its overland trade routes. The report also stated that Jordanian exports were already down by 17% y-o-y over the first two months of 2015, before the...

To read the full article Register for Free or Login

Commercial Banking

Jordan Commercial Banking

BMI View:

...
Commercial Banking Sector Indicators
Date Total assets Client loans Bond portfolio Other Liabilities and capital Capital Client deposits

To read the full article Register for Free or Login

Defence & Security

Jordan Defence & Security

BMI View:

BMI View: Amid regional instability, Jordan remains a key U.S. ally and we expect this defence relationship to develop further over the course of 2015. As defence budgets tend to grow amidst increased threat perceptions, for 2015, we forecast Jordan's defence expenditure to grow at annual rate of 9.7% to bring spending to USD2.8bn despite stagnation in the wider economy.

BMI determines an overall upward trend in the annual rate of growth in Jordan's defence expenditure. We think spending may be boosted by a substantial increase in U.S. military aid to Jordan currently under discussion in the Congress. We note that in the short to medium term manpower as a percentage...

To read the full article Register for Free or Login

Insurance

Jordan Insurance

BMI View:

BMI View: Jordan's insurance sector is dominated by the non-life sector and will remain so. Within this, key growth areas can be found in medical and property lines of business, both set to grow at double digit rates through to 2019. Fragmentation in the non-life sector offers opportunities to new entrants, but has also driven price downwards through high levels of competition. Growth in 2015 of 7% will see premiums reach USD800mn.

Jordan is a small, underdeveloped and reasonably rapidly growing insurance market. Insurance sector growth is driven by the steady development of trickle-down wealth, but remains primarily concentrated in the dominant non-life sector. The non-life market in particular is strengthened by its openness to participation from (mainly regional) multi-nationals such as the local elements of Arabia Insurance, Kuwait's...

To read the full article Register for Free or Login

Medical Devices

Jordan Medical Devices

BMI View:

BMI Industry View: The Jordanian medical device market is projected to grow at an above average pace of 9.3% per annum to 2018, but the overall market size and per capita spend will remain comparatively small in global terms. The key driver of growth remains medical tourism, for which Jordan is the No 1 destination in the region.

Headline Industry Forecasts

  • The Jordanian medical device market is projected to expand by a CAGR of 9.3% which should see it rise from an estimated USD243.7mn (JOD172.6mn) in 2013 to USD380.9mn (JOD270.4mn) in 2018. In per capita terms, the market is projected to rise from an estimated USD33.5 (JOD23.7) per capita in 2013 to an estimated USD47.9 (JOD34.0) per capita in 2018.

  • ...

To read the full article Register for Free or Login

Pharmaceuticals & Healthcare

Jordan Pharmaceuticals & Healthcare

BMI View:

BMI View: The majority of Jordan's pharmaceuticals will remain sourced from abroad despite the impressive domestic manufacturing industry. Local drugmakers will continue to supply the market with generic medicines but higher value innovative drugs will continue to be supplied by multinationals. Significant counterfeit medicine circulation and economic and political instability in neighbouring Syria will weigh down the domestic pharmaceutical markets appeal to foreign investment.

Headline Expenditure Projections

  • Pharmaceuticals: JOD643mn (USD905mn) in 2014 to JOD683mn (USD962mn) in 2015; +6.3% in local currency terms and US dollar terms. Forecast unchanged from Q3...

To read the full article Register for Free or Login

Telecommunications

Jordan Telecommunications

BMI View:

BMI View: Jordan's telecoms market suffered a tough year in 2014, with declines in both mobile and fixed voice subscriptions. While the fixed voice decrease is part of an overall global trend, the one in mobile came from a saturated market with a majority of prepaid subscriptions, many being discounted as inactive after stronger regulatory pressure on registration. We do not expect strong growth in the market, and believe that operators will look to deepen and not widen their customer base. The launch of 4G services, and the possible move towards converged plans, has the potential to drive revenues upwards, though competition will remain strong.

Key Data

  • ...

To read the full article Register for Free or Login

Latest Jordan Articles

Latest Jordan Blogs

  • The tentative rapprochement between Iran and the US, which began in the sec...

  • The Middle East is at a critical juncture. The anticipated nuclear deal bet...

  • Four years after the start of the Arab Spring, the prospects for much of th...

Latest Jordan Podcasts

  • As a decade of rising oil prices comes to an end, OPEC's decision to l...

  • The rise of jihadist group Islamic State (IS) in Syria and Iraq poses ...

  • The recent conflict between Israel and Hamas risked spiralling out of ...