Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

The COVID-19 pandemic has resulted in an unprecedented shock to firms with adverse consequences for existing productive capacities. At the same time, digitalization has increasingly been touted as a key pathway for mitigating economic losses from the pandemic, and we expect firms facing digital constraints to be less resilient to supply shocks. This paper uses firm-level data to investigate whether digitally-enabled firms have been able to mitigate economic losses arising from the pandemic better than digitally-constrained firms in the Middle East and Central Asia region using a difference-in-differences approach. Controlling for demand conditions, we find that digitally-enabled firms faced a lower decline in sales by about 4 percentage points during the pandemic compared to digitally-constrained firms, suggesting that digitalization acted as a hedge during the pandemic. Against this backdrop, our results suggest that policymakers need to close the digital gap and accelerate firms’ digital transformation. This will be essential for economies to bounce back from the pandemic, and build the foundations for future resilience.

Jordan

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

This paper discusses Jordan’s 2022 Article IV Consultation and Fourth Review under the Extended Arrangement under the Extended Fund Facility (EFF), Request for Augmentation and Rephasing of Access, and Modification of Performance Criteria. Jordan's EFF program remains firmly on track. The authorities have maintained macroeconomic stability and market access, while protecting the most vulnerable, and implementing key structural reforms, especially in the area of public finances. The IMF remains committed to supporting Jordan, including by augmenting access under the EFF to help address higher financing needs from higher international commodity prices and tightened global financial conditions. Donor support is critical to enable Jordan to cope with these global economic headwinds, while hosting 1.3 million Syrian refugees.

Jordan

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

Jordan.

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

Early success in containing the spread of COVID-19 has been challenged by two subsequent waves of the pandemic. Timely and effective fiscal and monetary policy responses helped contain the contraction in activity to 1.6 percent in 2020, shallower than the 3 percent expected at the first review. The authorities have also made significant efforts to protect jobs and the most vulnerable. Still, unemployment has surged to a record 25 percent in Q4 2020, with youth unemployment at 55 percent. The impact on fiscal and external balances has been significant, with public debt reaching 88 percent of GDP at end-2020. Nonetheless, despite the challenges from new virus variants and weaker tourism prospects, macroeconomic stability has been maintained, thanks to the authorities’ proactive policy stance; and a moderate 2 percent growth rate is projected for 2021 (slightly below the 2.5 percent projected in the first review), with a near-full reopening expected in the summer. The new parliament extended a vote of confidence to the incoming government in January, and approved the 2021 budget—consistent with the program—in February.

Jordan

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

This paper on Jordan focuses on the financial system stability assessment. Jordan’s financial sector, dominated by banks, has withstood several large external shocks since the latest financial sector assessment program (FSAP) that was conducted in 2008–09 in part thanks to measures implemented by the authorities to enhance the system’s resilience and oversight. The FSAP’s systemic risk analysis found that Jordan’s banking sector appeared broadly resilient. Banks would be able to withstand a large global stagflationary shock, if it were to occur, given high levels of system-wide regulatory capital and robust earnings. The challenging external risk environment highlights the need strengthening the financial stability framework. The FSAP recommended that the banking supervision approach be more risk-based and forward-looking. Pillar 2 supervisory assessments should be developed for more risk-sensitive capital requirements. The macroprudential framework needs stronger decision-making and a more refined strategy. Several data gaps should be filled to implement stress tests on a globally consolidated basis, run systemic foreign currency liquidity analyses, and perform more granular analyses of household and corporate sector vulnerabilities to guide the calibration of borrower-based macroprudential tools.

Jordan