“Some people want it to happen, some wish it would happen, others make it happen”….here I am wondering who’s making this happen and why???? Though Michael Jordan said this in the context of Basketball, this sort of fits in quite snugly with what’s going on with this new coziness between Jordan and the GCC too.
The news last week that Jordan has received an initial nod to join the GCC came as a surprise to a lot of people, but someone definitely had been working on it in the background to make this happen. While for the GCC it may be political reasons, for Jordan it makes quite a bit of economic sense too.
- Think about it, when Oman and Bahrain went into a tail spin earlier this year with political unrest, the GCC promptly announced that they’ll be happy to loan a few billion (USD 20 Billion ) to prop their economies. Jordan got no such comfort.
- While Bahrain and Oman lived the high life on borrowed cheap oil supplies from the GCC (with market rate oil imports their fiscal deficits would have been uglier), the Hashemite Kingdom of Jordan kept looking on with hungry eyes. (Jordan incidentally imports 95% of its energy requirements)
I may be oversimplifying things here, but everyone I talk to say Jordan's woes have its sources in not having oil, water and all that blah!, but hey there are countries and emirates in the region which have made better progress than Jordan over the years without water and oil reserves. Jordan with the cutest local economy, open regulatory policies and an amazing educated workforce which most of the GCC countries would not be able to catch up on in the next few decades is a no-brainer for progress. Isnt it!
And then Bang! Reality - Anywhere else in the world, I would have thought the potential of having a few billion in soft loans being pumped into the economy would have moved financial markets, but in Sleepy hollow Amman, the exchange barely moved a needle. In fact if I’m not mistaken it went down by some basis points last week in the middle of all this. (but I’m happy to be corrected on it). Why?
What’s even more curious is when nearly 40% of the total Amman Exchange market capitalization is held by two stocks – Arab Bank and HBTF, shouldn’t these stocks have moved more positively on this news and indirectly the exchange as a whole. I mean, think about it, with the announcement coming in, this time next year, Banks will be comfortable with the fact that their govt exchequer will have some more money if ever an intervention is required into the economy; Jordanians will have access to lower gas prices and oil prices and will be in a temporary state of emotional euphoria on joining this club…but if the stock prices are any indicator ..there’s something that I’m missing out on.
I’m thinking everyone’s feeling this is just a PR Gimmick, and no one thinks this will see the light of the day until the next few years.
Can someone please wake me up when Jordan is ready to do a slam dunk! Until then…itzzzz bizzzzzness azzz uzzzual…zzzzzzzz
The news last week that Jordan has received an initial nod to join the GCC came as a surprise to a lot of people, but someone definitely had been working on it in the background to make this happen. While for the GCC it may be political reasons, for Jordan it makes quite a bit of economic sense too.
- Think about it, when Oman and Bahrain went into a tail spin earlier this year with political unrest, the GCC promptly announced that they’ll be happy to loan a few billion (USD 20 Billion ) to prop their economies. Jordan got no such comfort.
- While Bahrain and Oman lived the high life on borrowed cheap oil supplies from the GCC (with market rate oil imports their fiscal deficits would have been uglier), the Hashemite Kingdom of Jordan kept looking on with hungry eyes. (Jordan incidentally imports 95% of its energy requirements)
I may be oversimplifying things here, but everyone I talk to say Jordan's woes have its sources in not having oil, water and all that blah!, but hey there are countries and emirates in the region which have made better progress than Jordan over the years without water and oil reserves. Jordan with the cutest local economy, open regulatory policies and an amazing educated workforce which most of the GCC countries would not be able to catch up on in the next few decades is a no-brainer for progress. Isnt it!
And then Bang! Reality - Anywhere else in the world, I would have thought the potential of having a few billion in soft loans being pumped into the economy would have moved financial markets, but in Sleepy hollow Amman, the exchange barely moved a needle. In fact if I’m not mistaken it went down by some basis points last week in the middle of all this. (but I’m happy to be corrected on it). Why?
What’s even more curious is when nearly 40% of the total Amman Exchange market capitalization is held by two stocks – Arab Bank and HBTF, shouldn’t these stocks have moved more positively on this news and indirectly the exchange as a whole. I mean, think about it, with the announcement coming in, this time next year, Banks will be comfortable with the fact that their govt exchequer will have some more money if ever an intervention is required into the economy; Jordanians will have access to lower gas prices and oil prices and will be in a temporary state of emotional euphoria on joining this club…but if the stock prices are any indicator ..there’s something that I’m missing out on.
I’m thinking everyone’s feeling this is just a PR Gimmick, and no one thinks this will see the light of the day until the next few years.
Can someone please wake me up when Jordan is ready to do a slam dunk! Until then…itzzzz bizzzzzness azzz uzzzual…zzzzzzzz
