Imad Fakhoury: Interview

Interview: Imad Fakhoury

How are Jordan Vision 2025 and the IMF’s Extended Fund Facility (EFF) programme progressing?

IMAD FAKHOURY: The EFF programme was based on a national economic and fiscal reform plan derived from Jordan Vision 2025. The programme aims to improve fiscal self-reliance by increasing tax revenue, redirect subsidies to Jordanians who need it, which will also strengthen our economic resilience and macro-economic stability, reduce the debt-to-GDP ratio and lower the deficit to reach the light at end of the tunnel fiscally by 2019. Given the persisting unprecedented regional instability, we had to, as a government, refocus our attention on economic growth and the national employment agenda. Based on the stipulations of Jordan 2025 and the EFF programme, we selected the most critical priorities. These include structural and doing-business reforms, e-government and digitisation implementation, and sectoral strategies in water, energy, infrastructure, transport, human resource development, labour, health and education. Jordan surpassed 15 countries in the World Bank’s “Doing Business 2018” report. The government is committed to continuous improvement.

We launched the Jordan Economic Growth Plan (JEGP) 2018-22, which affirms these priorities and aims to transform the economy in accordance with Jordan Vision 2025. The JEGP encourages future socio-economic development by supporting the development of small and medium-sized enterprises, entrepreneurship, the competitiveness of the economy and export agenda, and our capacity to expand existing investments and attract new ones. For the first time in several decades we have been expanding at one-third of our typical growth rate, at 2.1-2.2% real economic growth. We think we can double or triple those rates by the end of this five-year period. Returning to our usual growth trajectory is a priority, and we aim to do this by partnering with the private sector and civil society organisations to ensure all parties are focused on inclusive economic growth and the national employment agenda.

What are the ministry’s primary priorities and expectations for 2018 onward?

FAKHOURY: Our main priority is working with the economic cabinet to maximise the use of public-private partnerships (PPPs). We hope to use this expansion of PPPs to implement the capital expenditure plan under the JEGP. Historically, this approach has been avoided and only used as a last resort; however, we’re now reversing that policy. This aligns with the World Bank’s spring 2017 announcement of a new development “cascade approach”: it now strongly supports the transfer of maximum capital expenditures to PPPs or private investments given the scarcity of public resources and efficiency of private sector. As a result, we only use public resources to finance capital expenditures when either there isn’t an appropriate role for the private sector or there is potential for market failure.

We are also working with our international financial institutions, donor partners and their private sectors to realign Jordan’s assistance programme in support of JEGP. In addition, we are positioning Jordan to contribute to reconstruction efforts across the region building on our historic role as a business gateway for the MENA region. Significant resources will need to be invested to restabilise and re-construct countries that have been affected by conflict. Jordan can play a major role in these reconstruction efforts, mainly on the software side. Jordan specialises in consulting and financial services, professional services, programme management, design and engineering, financial packaging, capacity building and public sector training, and other human capital services. Not to mention Jordan’s logistical capabilities and construction industries potential. We’re confident that our growth programme, economic clusters and expansion of free trade potential will position us to continue to attract new investments and markets. We now need to focus on turning the challenges we have faced into opportunities that can benefit not only our economy, but also the investors that use our markets.