PERCHED on a hill beneath a ruined Crusader castle, Karak feels a world away from Amman, Jordan’s crowded and expensive capital. The sleepy city is surrounded by lush farms and sits astride the tourist trail, both of which should provide jobs. Yet it has been buffeted by the problems that afflict the rest of the kingdom. Mayhem in Syria and Iraq has hurt farm exports. A terrorist attack by Islamic State (IS) in 2016 sent tourists fleeing. Earlier this year protests broke out in Karak and other cities over the perpetually troubled state of Jordan’s economy.
The spark was a package of price rises announced in January as part of an IMF-backed reform programme. Bread prices nearly doubled and fuel taxes climbed from 24% to 30%. Such measures are necessary: Jordan spends $1.2bn a year (9% of its budget) to subsidise food, fuel and water. The debt-to-GDP ratio hit 95% last year, in part because just 3% of Jordanians pay income tax. But austerity is compounding their pain. The unemployment...Continue reading
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