The investor confidence index in Jordan during the second quarter of 2026 showed an increase of 21.9%, reaching 186.6 points compared to 153.1 points in the first quarter, while other economic components and indicators reflected divergent trends, most notably the decline in the industrial production quantity index for the third consecutive quarter, and the decrease in the confidence indices for the monetary and financial systems.
The Jordanian investor confidence index is based on three sub-indices measuring economic activity, the monetary system, and the financial system, meaning that the rise in the overall index reflects an improvement in the outcome of its components.
Economic expert Hashem Aqel said that the rise in investor confidence reflects an improvement in the perception of the ability to manage economic risks and the emergence of better opportunities, but it does not yet represent a complete shift towards viewing Jordan as a large-scale investment market.
He added that the rise in the confidence index to 186.6 points was mainly driven by a jump in the confidence index for economic activity to 200 points, the highest quarterly level in three years, coinciding with the growth of real GDP by 3% and the direct foreign investment inflows reaching about 457.5 million dinars.
Aqel explained that the improvement is more related to the relative stability in economic activity, the stability of the exchange rate, reserves, and the economy's ability to manage risks, while investment opportunities remain linked to the ability of the economic and institutional environment to convert them into viable projects.
He pointed out that the investor is primarily looking for stability in legislation, speed of procedures, the ability to achieve an appropriate return on risk, along with ease of access to financing, export markets, energy, skilled labor, while the size of the local market is of less importance compared to Jordan's ability to be a regional or export base.
Aqel pointed out that the challenge does not necessarily lie in the absence of investment opportunities, but in the ability to quickly and efficiently convert these opportunities into productive projects, especially in the energy, water, mining, tourism, pharmaceuticals, information technology, and export industries sectors.
Aqel believes that the real test of the current rise lies in the transition of optimism from indicators to the actual economy, through productive and sustainable investments, increased capital formation, exports, value added, and job creation, along with the efficient implementation of major projects and the improvement of business environment indicators.
For his part, economic expert Hussam Aaish said that the rise in the index reflects a real improvement, but it is still a partial improvement, explaining that economic activity was the main driver of the recorded jump, driven by the growth of real GDP by 3%, direct foreign investment inflows of 457.5 million dinars, and a reduction in the budget deficit compared to the previous quarter.
Aaish added that these data indicate an improvement in the investment environment and confidence in the overall economic performance, but the decline in the industrial production quantity index for the third consecutive quarter represents a contrasting signal, confirming that the improvement in confidence has not yet translated into a balanced increase in production capacity.
He explained that foreign investment inflows during the second quarter represent an important indication of the Jordanian economy's ability to attract capital, despite regional and international circumstances characterized by uncertainty, but one quarter is not enough to judge the sustainability of this trend.
Aaish pointed out that the evaluation of investments is not related to the size of the flows alone, but to their nature, the sectors they target, and their ability to create new production capacities, increase exports, provide job opportunities, and transfer technology, considering that the actual test lies in converting these flows into tangible economic results.
Conversely, the increase in the overall index does not mean that all its components are moving in the same direction, as the confidence indices for the monetary and financial systems declined, and the index data showed a decrease in the value of foreign reserves from 19.01 billion dinars in the first quarter to 18.49 billion dinars in the second quarter, coinciding with an increase in the value of returned checks to about 275 million dinars, compared to 260.7 million dinars in the previous quarter.
Aaish explained that part of these developments was linked to regional circumstances, gold price fluctuations, and the repercussions of geopolitical tensions, pointing out that reading these indicators in isolation from their context may lead to inaccurate conclusions, as the strength of the rise in the economic activity index was sufficient to compensate for the decline in the monetary and financial components and raise the overall index.
The decline in the industrial production quantity index stands out in this scenario as one of the most prominent points of divergence, as Aaish explained that rising energy prices, production inputs, and external conditions contributed to affecting industrial activity, despite the growth of real GDP and the improvement of foreign investment.
He added that the continued decline in the industrial index for several quarters may turn into a point of weakness, especially since the industry is linked to productivity, exports, job opportunities, and long-term investment, making the question not only about growth rates, but also about the nature of the sectors driving it and the extent of its impact on the real economy.
This divergence indicates that the rise in confidence does not necessarily mean the achievement of all economic results on the ground, as Aaish explained that the confidence index carries a forward-looking nature that reflects the improvement in the environment and expectations, but it does not automatically mean an increase in investment, production, and employment to the same extent.
The reading of the two experts converges on the fact that the rise in confidence represents a positive signal for the Jordanian economy, but it does not alone constitute evidence of a sustainable economic transformation, as the sustainability of this improvement remains linked to its ability to transition from the index to investment, from investment to production, and then to exports, job opportunities, and income.
Thus, the second quarter represents a notable milestone in the path of investment confidence, but at the same time, it places the Jordanian economy before a more important test, which is to convert the rise in confidence into tangible productive activity, especially in light of the continued divergence between the improvement in growth and investment indicators on the one hand, and the decline in the industrial production quantity index and some components of the monetary and financial system on the other hand.
