Jordan cuts food & fuel prices, and creates govt jobs

In a $230 mln package to preemptively prevent riots


Jordan approved around $230 million package to reduce prices of commodities and to create jobs in an attempt to aid the country’s poor and mitigate rising popular discontent, a newspaper reported on Thursday.

Jordan’s King Abdullah II’s decision was made last Monday when he said that basic goods should be available at the lowest possible prices for his citizens, the Gulf News reported.

The country’s deputy premier Ayman Safadi said in a news conference that there are other cuts which will include six percent of fuel, gasoline, and kerosene prices, and a subsidy of around $28.21 million to the country’s cooperative stores to help reduce the prices of basic commodities.

Safadi also added that another $28.21 million will be allocated to fight poverty and set up development projects in underprivileged areas including the creation of government jobs in several ministries such as health, education and development ones.

"These measures will cost the budget 120 million dinars ($169 million)," he said, adding that the measures aim to help "minimize the impact of economic problems on Jordanians... in light of soaring international prices."

To stave off riots

Jordan's price cuts in essential consumer items come after the deadly riots caused by joblessness and poor prospects for youths in Algeria and Tunisia, and after popular Jordanian labor activist Mohammad Sneid called for a protest.

Mohammad Sneid's call was supported by several left-leaning labor and tribal opposition groups.

The protest is against fuel and food prices, and inflation, which rose by 1.5 per cent to 6.1 percent last month. It was triggered by high unemployment and poverty among a population of six million, with a majority under 25 years.

Jordan lifted subsidies on fuel and gasoline as part of free-market reforms but imposes hefty taxes, the highest in the region.

Gasoline prices have recently risen in line with pressure on oil prices.

But Jordan has previously reduced the cost of sugar and rice in state-run supermarkets by 10 percent and enforced price caps on food price hikes, a cabinet statement said.