Jordan’s king suspends price rises in wake of civil chaos

Jordanian King Abdullah II intervened directly, instructing the government to shelve hikes.
Friday 01/06/2018
A file picture shows Jordan’s King Abdullah II speaking during a news conference. (Reuters)
A file picture shows Jordan’s King Abdullah II speaking during a news conference. (Reuters)

TUNIS - Jordan's King Abdullah II ordered a halt to electricity and fuel price increases that had been agreed to with the International Monetary Fund (IMF) as part of reforms for the cash-strapped country’s economy.

Hundreds of Jordanians took to the streets May 31 in Amman protesting the price hikes, burning tyres and calling for the “fall of the government,” Agence France-Presse reported.

The protests followed government decrees mandating price increases of up to 5.5% on fuel and 19% on electricity prices, as well as planning for a new income tax.

However, King Abdullah directly intervened early June 1, instructing the government to shelve hikes that would have gone into effect that day, the official Petra news agency reported.

Prices have gradually risen in Jordan in recent years as the government pushed economic reforms demanded by the IMF. The country has a public debt of $35 billion, equivalent to 90% of its gross domestic product.

It secured a $723 million, 3-year line of credit in 2016 from the IMF to support economic and financial reforms and was told it must end subsidies and increase taxes as preconditions for future loans.

Earlier this year, Jordan practically doubled bread prices after dropping subsidies on the staple. Value added taxes were increased on many goods, including cigarettes. Fuel prices have increased five times since the beginning of the year. Electricity bills have risen 55% since February.

Government estimates state that 18.5% of the population is unemployed and 20% is said to be on the brink of poverty.

More than 1,000 demonstrators gathered outside the prime minister’s office in Amman late May 31, chanting: “The people want the government to fall.”

In the northern cities of Irbid and Ajloun, demonstrators blocked roads with burning tyres, and in the Tabarbour suburb of Amman motorists blocked roads with vehicles.