Economists: Government Incentive Policies Drive Growth to 3%

This growth rate is the highest in years and comes despite exceptional circumstances in the region and the world.

The growth rate achieved is higher than the expectations of international financial institutions for the Jordanian economy during this period, thanks to government economic policies, incentives, and positive decisions that reflected on various indicators and led to achieving a higher growth rate than expected.

The agriculture, manufacturing, and electricity sectors were among the most prominent productive sectors that led economic growth, with the agriculture sector achieving the highest growth rate of 7.8%, followed by the manufacturing sector at 6.2%, and then the electricity sector at 5.0%.

In turn, financial and economic expert Dr. Mohammad Al-Hadab Al-Sarhan confirmed that the growth of the Jordanian economy by 3% during the second quarter of 2026, compared to 2.8% in the same quarter last year, is a positive result given the regional and exceptional circumstances surrounding the Kingdom. But more important than the growth figure itself is its composition, as a large part of it this time came from real productive sectors, which gives the growth greater value than an expansion based primarily on consumption or non-exportable activities.

Al-Sarhan explained that the manufacturing sector provides the strongest indication in the data; the sector grew by 6.2%, accounting for about 17.2% of GDP, and contributed alone about 1.04 percentage points out of a total growth of 3 points, or nearly 35% of the achieved growth. If the contributions of agriculture, electricity, and water are added to the industry, these four productive sectors contributed about 1.54 percentage points, or more than half of the economic growth during the second quarter, and these are some of the most important messages carried by the numbers.

He pointed out that this performance coincides with the improvement of foreign trade indicators, as total exports increased by 10.3% during the first seven months of the year, and national exports by 4.6%, while the trade deficit decreased by 6%. This does not mean that the growth of the industry alone is responsible for the improvement of foreign trade, but the direction of the two indicators together is important; because expanding the industrial base and increasing exportable production raise the economy's ability to attract foreign currencies, improve the trade balance, and create more jobs linked to production and investment.

Al-Sarhan explained that the numbers also reveal a disparity worth following between sectors; while agriculture grew by 7.8%, industry by 6.2%, and electricity by 5%, the real estate activities sector, which accounts for 12.2% of GDP, grew by only 0.9%, while the mining and quarrying sector declined by 3.4%. This means that there is room to increase growth further if the performance of the slower sectors improves, especially by increasing investment and productivity, reducing energy and transportation costs, and expanding foreign markets.

Al-Sarhan added that reaching 3% is important, but the real value of this figure will appear if it becomes the beginning of a continuous path, not just the result of a good economic quarter. The economy needs growth led by industry, investment, and exports, because this type of growth is most capable of reaching the labor market and household income. If Jordan can maintain the momentum of the industry, expand exports, and convert announced projects and investments into actual production, the question in the next phase will not only be how to maintain 3% growth, but how to build on it a higher and more sustainable growth rate that the citizen can feel more clearly.

Al-Sarhan pointed out that this performance comes in the context of King Abdullah II's follow-up to the implementation of the economic modernization vision and the stimulation of investment and productive projects, in parallel with the follow-up of His Highness Crown Prince Hussein bin Abdullah II to investment files, supply chains, and priority sectors, and government work within the executive program of the vision to support industry, investment, and exports. In his estimation, maintaining this momentum and accelerating the implementation of economic projects and reforms is the way to turn the current improvement from positive quarterly figures into sustainable growth that reflects more on jobs, income, and the standard of living of citizens.

Economic expert Munir Diya said that despite the geopolitical challenges facing the region, which affected most of the world's economies, the Jordanian economy continued to achieve more achievements, especially in the main economic indicators, the most prominent of which, according to the Department of Statistics, was the increase in the economic growth rate to 3% during the second quarter of this year, compared to the same period last year, and thus the Jordanian economy grew at a rate exceeding the expectations that ranged between 2.5 and 2.8%.

He added that this indicator is the most prominent among a group of economic indicators that the Jordanian economy has been able to achieve since the beginning of this year, whether in terms of increasing foreign reserves exceeding $28 billion, or increasing total exports by more than 14%, as well as increasing remittances from expatriates, stabilizing tourism income, and reducing unemployment rates, and many indicators that proved that the Jordanian economy is capable of withstanding and recording more stability and showing sufficient flexibility to deal with the successive crises witnessed by the region and the world.

He pointed out that the ability of a group of economic sectors to record high growth rates, benefiting from the state of instability in the region, and achieving additional momentum in growth rates and contributing more to GDP growth, pushed towards compensating for the decline of some sectors due to current security and political circumstances. This provided a boost for the national economy to achieve growth rates that exceeded expectations, and led the agriculture and manufacturing sectors and electricity to lead growth rates to advanced levels.

Diya pointed out that the government policies adopted by the government since the beginning of the crisis, and the economic decisions taken, contributed greatly to achieving this achievement, which will generate more confidence in the national economy, enhance its position before international institutions, and provide more space to attract more foreign investments, achieve more economic growth, and move forward in obtaining more international support to implement the major projects announced by Jordan, which exceed 10 billion dinars over the next three years, in the main sectors such as water, energy, transport, and infrastructure.