Jordan's Industrial Exports Surge, Boosting Economic Growth

What's Happening?

Jordan's industrial exports have seen a significant increase in the first half of 2025, reaching approximately 4 billion dinars compared to 3.7 billion dinars in the same period of 2024. This growth, amounting to an increase of 259 million dinars, highlights the resilience and competitiveness of Jordanian industry. The manufacturing sector grew by 8%, with leather and clothing, food industries, and chemicals and cosmetics leading the growth. These sectors contributed 71% of the increase, demonstrating their ability to adapt to global market needs. The growth in exports is crucial for Jordan's economy as it enhances local value added, improves the current account, and reduces reliance on imports.

Why It's Important?

The increase in industrial exports is vital for Jordan's economy as it brings more foreign currency into the country, improving the current account balance. Higher exports lead to increased company profits, boosting income tax revenues and reducing the need for external borrowing. This growth also strengthens the government's budget by increasing indirect taxes like sales tax. Diversifying export markets to countries like Syria, Ethiopia, and India reduces dependency on traditional markets, ensuring a steady flow of foreign currency. However, challenges such as rising energy costs and global supply chain issues remain, necessitating improvements in energy efficiency and logistics.

What's Next?

Jordan needs to focus on increasing local content in exports and enhancing productivity in leading sectors to sustain export growth. The government should support industrial sectors by promoting energy efficiency, strengthening logistics systems, and facilitating trade finance. Addressing technical requirements in new markets and managing global supply chain problems will be crucial for maintaining growth momentum. By doing so, Jordan can achieve a stronger current account, reduce fiscal deficits, and establish a robust presence in global markets.