Tourist arrivals will likely see a drop in the coming weeks
Escalating tensions and violence in Gaza will weaken overall private consumption in Jordan through Q4 2023 at least. MNCs can expect to see a drop in tourism numbers in the short term as security concerns remain elevated over the coming weeks. Route-to-market disruptions in Amman may increase if protests escalate. While public sector investments will likely be maintained, private sector investment sentiment toward Jordan may weaken in the medium term should the conflict persist over the coming weeks.
- Jordan has canceled a four-way summit it was expected to host with US President Joe Biden alongside the Egyptian and Palestinian leaders to discuss Gaza. King Abdullah has strongly condemned the Israeli air strike that hit the Al-Ahli Hospital in Gaza City, calling it a “shame on humanity.”
- Protests broke out in Amman on Tuesday (October 17) outside the Israeli embassy as dozens of protesters attempted to storm the embassy.
- Jordan announced the closure of King Hussein Bridge on October 10 to passenger and freight traffic. The official spokesman of the Jordanian Public Security Directorate said that the bridge’s closure comes at the request of Israeli authorities, citing security reasons. At the time of this writing, the Sheikh Hussein (north) crossing and the southern crossing remain open.
- Despite the Jordanian’s Tourism Board statement, travel agencies are already seeing some cancellations, and United Airlines (likely the first of many) will waive cancellation fees.
Jordanian-Israeli ties will remain tense in the coming weeks as King Abdullah firmly rejects the possibility of a mass exodus of Palestinian refugees into Jordan. The King Hussein Bridge will remain closed for the foreseeable future, as security risks remain high. Terrorism risk remains low, but isolated attacks are possible (albeit at a lower likelihood than in Egypt). Pro-Palestine protests will continue in Amman as the conflict escalates. Despite the low likelihood of elevated security risks, the tourism sector will be directly impacted in the short term. Tourist arrivals will see a significant drop in the next few weeks as security concerns remain elevated. While economic support from the US and the Gulf (notably Saudi Arabia) will remain, growth in private investments is under risk should the conflict escalate in the coming weeks.
- Hamas-Israel conflict will have severe economic ramifications
- Hamas-Israel conflict: Implications for Egypt
- Hamas-Israel conflict: Risk of regional spillover
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