Oil and turmoil
Jordan’s adjustment challenges amid local and regional change
in Oil and the political economy in the Middle East
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This chapter investigates impacts of low oil prices, from 2014 onwards, on Jordan’s fiscal and foreign policy. High prices of oil have long been blamed for amplifying Jordan’s fiscal deficits, also counterbalanced via aid and remittances from Gulf Cooperative Council (GCC) states. These economic linkages in turn deepened GCC states’ influence over Jordanian foreign policy. By contrast, has cheap oil lightened Jordan’s fiscal deficits and political dependency on GCC states? This chapter argues that it has not. Jordan’s fiscal deficits expanded with cheap oil. While low oil prices and cuts in GCC aid initially buffeted Jordanian foreign policy under the GCC’s pressure, the depth of Jordan’s debt crisis and the public’s mounting discontent over fiscal reform ultimately pushed Jordan to solicit even more aid. This compromised fiscal reform and Jordan’s foreign policy autonomy, despite the low oil prices from 2014 to 2018.

Oil and the political economy in the Middle East

Post-2014 adjustment policies of the Arab Gulf and beyond

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