Why only 7.6% economic growth?
The preliminary estimates of the Department of Statistics indicated that the real growth of Jordan’s gross domestic product (GDP) rose during the first half of 2005 at the rate of 7.6 per cent in comparison to the level reached during the same period of last year. This is, of course, a good growth percentage; some commentators thought that it is too good to be believed and may have been exaggerated to boost the morale of the business circles.
Actually this high percentage of growth could be on the conservative side. It seems that the Department of Statistics prefers to err on the side of reserve than on the side of exaggeration. I venture to claim that the real economic growth in 2005 could have been estimated at close to 10 per cent had the Department of Statistics been a little bit more aggressive in its calculations.
As it is well known, share prices at the Amman Stock Exchange rose to three times the level reached one year ago. This development placed billion of extra dinars at the disposal of share owners which must have altered their behaviour towards consumption and investment in the positive direction. Of course consumption and investment are components of the GDP. They rise and fall with the rise and fall of GDP. [more]