Jordan, minerals extraction and the resource curse

In its role as a competitive producer of phosphate and potash Jordan has not suffered noticeably from the Resource Curse over the past 50 years. However, the effects on its economy because of its geographical proximity to major oil-producing states have been both positive and negative. It is arguable that an oil resource curse has applied to Jordan.Significant capital inflows from the oil economies during the 1970s enabled development of key sectors of the Jordanian economy, including mining and some manufacturing and enhanced the nation’s infrastructure. However, declining real oil prices and falling worker remittances during the 1980s led to painful readjustments and adversely impacted on Jordan’s economic development. There has been little or no evidence of Dutch disease in Jordan since 1960, though wars in energy rich nations such as Kuwait, Iraq and even Iran, have had an adverse impact on the economy. Mineral exploitation also has not adversely affected education spending.The direct and indirect effects of minerals and energy extraction at home and in nearby nations presently place Jordan at about the 50th percentile in the list of world nations in terms of their human development profile.

► This paper analyses the impact of minerals on the Jordanian economy.
► Jordan’s performance has been assessed using MMSD framework.
► A time series regression model has been estimated.
► Variables that have influenced the economy have been identified.
► Dutch disease impact was analyzed.