Cairo Amman Bank Flash Comment: Jordan's Trade Deficit Narrowed By 15.7% In The First Seven Months Of 2015

The Department of Statistics released figures showing that Jordan’s trade deficit narrowed by JD 929.7 million or 15.7% during the first  7 months  of 2015 compared to the same period in 2014.

• The trade balance stood at JD -5,006.8 million in the first seven months of 2015, compared to JD -5,936.5 million over the same period in 2014.

• This drop comes as exports, imports, and re-exports have decreased over the same time period. National exports have decreased by 7.7% in the first 7 months, whereas imports have decreased by 12.5%. Meanwhile, re-exports have decreased by 2.5%.
• Total exports have decreased to JD 3,179.3  million in the first seven months of 2015 from JD 3,417.5 million for the same period in 2014, as intensifying political instability in the region weighs further on Jordan’s main exports. Fertilizer exports decreased sharply by 22.9%, fruits and vegetable exports decreased by 4.1%, pharmaceutical exports decreased by 12.8%, potash exports decreased by 3.3%. Meanwhile, clothes exports increased by 10.8% and phosphate exports increased by 4.1%.
• On the other hand, imports decreased to reach JD 8,186.1 million in the first seven months of 2015 with a decrease of 12.5% compared with the same period of 2014. The decrease is attributed to a drop in imports of iron and its products by 13.1%. On the other hand, machinery and its parts’ imports rose by 18.2%, vehicles imports rose by 13.6%, electrical machinery and their parts rose by 17%, while jewelry and precious metals’ imports rose the most by 45.8%.
• Most significantly, crude oil imports have decreased by 45.6% to reach JD 1,431.3 during the first seven months from JD 2,631.8 million over the same time period in the previous year, likely due to a drop in international oil prices over the same time period.

• A more detailed look at Jordan’s monthly oil bill reveals that oil imports in July 2015 were down by 36.7% when compared to July 2015:

 in million JD

• Looking ahead, the sustained drop in oil prices is expected to continue to reflect positively on the trade balance in 2015, which will help offset the significant drop in exports.