Massive Tourism, Oil Pipeline Projects to Boost Jordanian Economy
Nicole Robinson / Abdullah Hayek /
Jordan’s tourism sector is booming. In the first quarter of 2023, tourism increased by 90.7%, surpassing tourism numbers in the first quarter of pre-COVID 2019.
Petra, Wadi Rum, Karak Castle, Aqaba, and the Dead Sea are just a few of the sites that have put the Western-friendly Hashemite kingdom of Jordan on the map. Tourism, however, is not the only growing economic sector in Jordan. The technology and energy sectors show potential for economic growth in a kingdom heavily dependent on foreign aid.
With a population of 11 million, Jordan is a key U.S. regional ally on global counterterrorism, at peace with Israel, and a moderating influence in the Arab world. The country’s 760,000 registered Iraqi, Syrian, and Palestinian refugees, however, put pressure on an economy with limited natural resources, a bloated public sector, and a weak private sector. The COVID-19 pandemic and the impact of Russia’s war on Ukraine on global food and energy markets exacerbated matters with high debt, unemployment, and rising poverty.
To ease Jordan’s economic burdens, the United States provides more aid than any other country, totaling more than $23.8 billion over the past 70 years and reaching $2.6 billion in 2020 alone. Foreign aid, however, can never be the basis for long-term growth.
From 2020 to 2023, Jordan’s score in The Heritage Foundation’s Economic Index dropped 7.2 points. Jordan has benefited from a fairly open trade and investment system, but economic growth has stalled due to the lack of regulatory reform. (The Daily Signal is the news outlet of The Heritage Foundation.)
Nevertheless, Jordan enjoys some natural economic advantages. Religious tourism is a great start.
For Christians, Jordan holds special significance. Although the country is predominantly Muslim, it is home to some of the oldest Christian communities in the world and to important Christian religious sites. Jesus Christ was baptized by John the Baptist along the Jordan River. The site, known as “Bethany Beyond the Jordan,” attracts about 200,000 visitors annually.
To boost the number of visitors at this important religious site, a $300 million project was launched in December. The proposed project includes a new tourist hub with a visitor center, baptismal pool, and a series of walkways and bridges to explore the area lined with restaurants, souvenir shops, and botanical gardens.
Government funds will not finance the project. Nine faith-based organizations are mobilizing private investment to build welcome areas and 12 new churches. The Baptist World Alliance, a global network of Baptist churches, will partner with the Jordanian Baptist Convention to construct a Baptist outpost. The Anglicans, Greek Orthodox, Catholics, Evangelical Lutherans, and others are also slated to build new churches, guest houses, and residences for monks and priests.
The 30,000-square-meter Catholic Church will be the largest church complex in the Middle East. The Catholic Latin patriarch of Jerusalem called the site a “place of unity” amid tensions in the Middle East.
Jordan expects the upgraded religious site will attract more than a million visitors annually, boost tourism income, and strengthen interfaith ties between Muslims and Christians.
Tourism alone, however, will not solve Jordan’s economic woes nor provide enough jobs for its educated workforce. According to the U.S. International Trade Administration, “The Information Communications and Technology (ICT) sector in Jordan is one of the fastest growing sectors in Jordan’s economy, accounting for 3.8% of [gross domestic product] with total annual revenue exceeding [$2.3 billion.]”
Jordanian Crown Prince Hussein bin Abdullah II wants to position Jordan as a regional leader in the tech sector by sponsoring coding boot camps, hackathons, and entrepreneurship competitions, intended to enhance Information Communications and Technology skills among Jordanian youth. Neighboring Israel is a global leader in cybersecurity and digital innovation. Growth in the tech sector would give Jordan access to the region’s market of 400 million consumers.
Energy represents another major growth sector. The Basra-Aqaba oil pipeline project, a joint venture between the governments of Jordan and Iraq to construct a new oil pipeline between the southern Iraqi city of Basra and the Jordanian port of Aqaba on the Red Sea, aims to boost Jordan’s energy security and provide Iraq with a new and safe export route for its oil.
The two nearly 1,050-mile-long pipelines would be able to pump out 2 million to 3 million barrels per day. The project is expected to cost $18 billion to build.
The project’s economic benefits are significant for both Jordan and Iraq. For Jordan, the pipelines could bring between $500 million and $3 billion in transit fees each year. For Iraq, the pipeline could diversify the country’s export routes and link its economy to more stable Arab neighbors and away from Iran.
For Europe and the United States, the pipeline would reduce the world’s reliance on oil transmitted through the Strait of Hormuz.
U.S. foreign aid is an expensive, band-aid solution to Jordan’s economic problem. By promoting trade and investment, diversifying its economy, and encouraging investment-driven entrepreneurship and innovation, Jordan can create a more sustainable and prosperous future for its people.
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