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Economic Freedom
A Path to Stability in Jordan and Beyond

4.1 Minutes
Gloria Al-Khalasa is a Communications Officer at the Friedrich Naumann Foundation for Freedom (FNF) in Jordan. With a degree in Languages and Translation, she has experience in NGOs . She is multilingual, fluent in Ukrainian, Russian, English and Italian, and also has a keen interest in photography and composing articles.
  Gloria Halasa
Economic Freedom as a Path to Stability in Jordan

Why this conversation matters now

Across the Middle East, growth is slowing and uncertainty is rising. Regional conflicts, tight public finances, and the global trade environment all weigh on prospects. Yet Jordan has quietly maintained macroeconomic stability, kept inflation low, and pursued reforms aimed at unlocking private-sector growth. This is precisely where liberal principles—open markets, the rule of law, entrepreneurship, and accountable governance—can turn stability into opportunity. (The World Bank Documents)

Jordan’s baseline: stability with constraints

Recent assessments point to a mixed picture. Inflation has remained low and reserve buffers are solid, supported by cautious monetary and fiscal policy. But growth hovers near the mid-2% range and unemployment remains high—especially among youth—signaling that stability has not yet translated into enough quality jobs. (IMF)

  • Inflation & buffers: The IMF notes low inflation and strong reserves alongside steady policy implementation—conditions that help anchor confidence. (IMF)
  • Growth & jobs: World Bank projections show growth around 2.5% in 2025–26, which is not sufficient to rapidly absorb new entrants into the labor market. Youth unemployment remains elevated—around 42% in 2024 per World Bank/ILO estimates. (The World Bank Documents)

Complicating this landscape is Jordan’s role as a host country for refugees—a long-standing commitment that reflects the country’s humanitarian ethos while adding fiscal and labor-market pressures that must be managed with smart policy and international partnership. (UNHCR Operational Data Portal)

The liberal economic lens

Liberalism argues that economic freedom and democratic accountability reinforce each other: when citizens can start firms, access capital, compete fairly, and trust predictable rules, they are more likely to invest in their future—and to participate constructively in public life. In practice, this comes down to three priorities for Jordan and the region:

  1. Open, competitive markets with clear rules.
    Transparent regulations, streamlined licensing, and contract enforcement are essential to attract investment and raise productivity. IMF and World Bank analyses consistently link higher, more inclusive growth in Jordan to structural reforms that lower barriers to entry and reduce the state’s footprint in competitive markets. (IMF)
  2. Entrepreneurship and skills.
    A vibrant private sector depends on human capital. Reducing youth unemployment requires pairing macro-stability with targeted measures: digital skills, SME finance, and easier firm entry/exit. Programs that mentor first-time founders—especially women and refugees—translate values into livelihoods.
  3. Accountability and predictability.
    Sound public finances, independent institutions, and data-driven policy keep inflation in check and reduce uncertainty—vital for long-horizon investment decisions. Jordan’s recent arrangements with international partners, including IMF facilities that support resilience and reform, can help crowd in private capital when matched by tangible domestic reforms. (IMF)

Jordan’s opportunity spaces

1) Energy transition and cost competitiveness

Jordan has expanded renewables rapidly in the past decade and is now pursuing efficiency and green-hydrogen roadmaps. Lower, more predictable energy costs and efficiency gains can raise firm competitiveness, reduce import dependence, and attract clean-industry investment—especially if grid and market rules enable private participation and fair pricing. (energy-jordan-germany.org)

2) Digital economy and services exports

With stability and English-Arabic bilingual talent, Jordan can grow niches in fintech, business-process outsourcing, and creative industries. Policies that ease cross-border digital trade, protect data, and enable e-payments and digital IDs will help SMEs scale.

3) Refugee inclusion tied to growth

Jordan’s experience shows that with the right frameworks—work permits, skills recognition, and investment into host communities—refugee inclusion can support formalization and local demand. Continued international support remains crucial, but the long-term payoff is a larger, more dynamic market. (UNHCR Operational Data Portal)

Regional headwinds—and how economic freedom helps

MENA growth prospects have softened amid global trade frictions and price volatility, which can crimp investment and export demand. The liberal response is not protectionism but resilience through openness: diversified trade links, competition that spurs innovation, and transparent rules that make economies shock-absorbing rather than shock-amplifying. For Jordan, this means doubling down on reforms that boost productivity and crowd in private capital while maintaining social protection for the most vulnerable. (World Bank)

What success could look like

  • Faster firm entry and growth: measurable reductions in time and cost to start or expand a business; more SMEs accessing finance.
  • Jobs for youth: rising formal employment rates for 15–24s, especially for young women. (World Bank Open Data)
  • Energy costs and reliability: greater renewable/efficiency penetration with market reforms that deliver competitive tariffs for industry. (memr.gov.jo)
  • Predictable macro framework: low, stable inflation and steady reserves alongside gradual, credible fiscal consolidation. (IMF)

FNF’s role: from values to outcomes

FNF’s mission is to advance freedom as the basis for human dignity and prosperity. In Jordan, that means convening dialogue among policymakers, entrepreneurs, investors, and civil society; supporting skills for enterprise and employability; and sharing comparative lessons from liberal economies. Programmatically, this aligns with initiatives that:

  • Lower barriers for entrepreneurs (regulatory literacy, mentorship, access to markets),
  • Build employability (digital and green-economy skills), and
  • Champion rule-of-law reforms (transparency, competition, and fair procurement).

In a challenging neighborhood, Jordan shows that macroeconomic stability plus liberal reforms can widen opportunity—turning resilience into durable growth and expanding the space for democratic participation.