Despite decline, Jordan remains among most economically free nations

AMMAN — Despite Jordanian businesses having good access to sound money, the performance of the legal structure and the security of property rights remain modest, according to a recently released international report.

Jordan ranked 14th worldwide among 159 countries, with an overall rating of 7.82 out of 10 points in the 2016 Economic Freedoms report compiled by Canada-based Fraser Institute and based on 2014 data.

In the report, the Kingdom came in third among Arab countries, following the United Arab Emirates (7.98) and Qatar (7.91). 

The index measures the degree to which the policies and institutions of countries are supportive of economic freedom through five parameters.

The parameters are: size of government, legal system and security of property rights, access to sound money, freedom to trade internationally and regulation of credit, labour and business.

Jordan scored highest in the access to sound money (9.5), followed by the size of government and the freedom to trade internationally (8 points for each), 7.5 points for regulations, to finish with the lowest score for the legal system and security of property rights parameter (6.1).  

In last year’s report, which drew on data from 2013, Jordan’s overall rating stood at 7.93 out of 10, which entitled the country to the seventh ranking worldwide and the second regionally, topped only by the UAE.

The report cites Jordan, Kuwait, the UAE, Oman and Saudi Arabia as the countries with the largest decreases in rankings.

Hong Kong and Singapore topped the list at 9.03 and 8.71 respectively, while Libya (4.58) and Venezuela (3.29) came last.

Commenting on the report’s findings, economist Zayyan Zawaneh cited an international trend of decline in economic freedom, even in capitalist countries that claim to be promoting these freedoms, but indeed embark on restrictive actions, such as obstructing Chinese investments in the United States and Europe for “national security purposes”.

The decline in economic freedom in Jordan over the past few years is mainly due to decisions based on miscalculations as well as weak public sector performance, he told The Jordan Times Monday.

However, the government must work on improving Jordan’s performance in such reports as they directly influence the influx of investments into the Kingdom, he added.

Zawaneh acknowledged an impact of the Syrian crisis on Jordan’s economic freedom, yet this must not be taken as a pretext for not exerting additional efforts  to improve the national economy.

He cited bureaucracy as an example of a major hindrance to progress, noting that while authorities need up to 12 days to carry out a security check to issue a visa for a non-Jordanian willing to visit for medical tourism purposes, other countries in the region would issue the visa in a couple of days. 

Gender

In a chapter on gender disparity in legal rights and its effect on economic freedom, the index connects Jordan’s low female labour-force participation rates, which are around 15 per cent, to “the legal obligation for women to obey their husbands”, a matter that results in fewer women working outside the home in spite of their constitutional right to work.

Reem Aslan, an International Labour Organisation consultant, told The Jordan Times that the main reasons for women’s low economic participation in Jordan are the lack of daycare facilities at the workplace, low salaries and the lack of efficient transportation means.

Around 60,000 out of the 200,000 Jordanians actively seeking jobs are women, according to Aslan, who cited studies showing a trend of growing female presence in the workplace prior to giving birth, while for working mothers the curve starts declining.