Jordan's real GDP growth speeded up to 3.06% y/y in the second quarter of the year from 2.6% in Q1 as all the major economic sectors achieved positive growth rates led by mining and quarrying, construction and agriculture, data from the statistics office DoS showed. In H1 2013, the GDP growth averaged 2.83%. Despite the partial spillovers of the Syrian turmoil and the related inflow of refugees into Jordan, the country has benefited from its stable political and security environment, rising remittances from expatriates and strong private consumption to boost the GDP growth.
It is worth noting that bank lending has been steadily growing in 2013, rising 7.7% y/y to JOD 18.56bn (USD 26.2bn) at end-July 2013 supported mainly by higher private-sector borrowing.
Jordan’s GDP growth will increase to 3.3% in 2013 from 2.8% a year earlier, on rising government capital spending, higher domestic consumption and a recovery in exports, the IMF said in its latest World Economic Outlook published in April.
Recovering regional demand and basic commodity prices, mainly of potassium and phosphates, led to a 12.8% y/y expansion in mining and quarrying in Q2 compared with a 18.3% drop in the previous quarter. The second best performer in Q2 was the construction sector which grew by 9.5% y/y, accelerating from 7.8% the quarter before. Strong local, expat and Arab demand for housing remain the main growth engines.
Favourable seasonal factors during the cultivation period led to an 8.7% y/y rise in the agriculture output reversing an 8.3% contraction in Q1.The social services sector followed at 5.8% growth given strong public spending.
Trade, hotel and restaurants output increased 1.8% y/y in Q2. The transport and logistics sector grew 3.6% over the period due to strong activity though Iraq and the GCC. The financial services, insurance and real estate sector expanded 4.1% y/y in Q2.
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