Structural adjustment and social protection in the Middle East and North Africa: food subsidies in Jordan

Abstract

Jordan has been praised by the International Monetary Fund (IMF) and the World Bank (WB) as a successful case of social protection reform. While implementing a structural adjustment programme (SAP), Jordan accepted the WB's policy assistance and successfully eliminated food subsidies, which the IMF/WB have repeatedly criticized for their inefficiency as a poverty alleviation programme. Nevertheless, even while officially suspending food subsidies, the Jordanian government still continued to fund them. Moreover, it officially reinstituted the subsidies in 2005. This fact demonstrates that the policy assistance is not powerful enough to change the food subsidy system, which is in-built in the social contract in Jordan.