Foreign aid shaped social development in Jordan from 2000 to 2024 by supporting resilience rather than structural transformation
This article argues that while foreign aid successfully bolstered Jordan's social resilience and maintained human development gains between 2000 and 2024 amidst regional shocks, it failed to drive structural transformation, resulting in rising unemployment and poverty due to an overreliance on budget support rather than productive investment.
Original paper licensed under CC BY 4.0 (https://creativecommons.org/licenses/by/4.0/). This is an AI-generated explanation of the paper below. It is not written or endorsed by the authors. For technical accuracy, refer to the original paper. Read full disclaimer
In the world of international development, money from wealthy nations often flows to countries facing difficult times, with the hope that these funds will lift people out of poverty and build stronger economies. This practice relies on a few simple ideas: that extra money can fill gaps in a country's budget, that it can pay for schools and hospitals when local funds run low, and that it can help a nation recover from disasters like wars or floods. For decades, observers have watched to see if this money actually changes the fundamental structure of a society, turning struggling economies into thriving ones, or if it merely keeps the lights on during a crisis. The question is not just whether the aid arrives, but what it actually builds. Does it create jobs and reduce inequality, or does it simply prevent things from getting worse while the underlying problems remain?
A recent study by Musa Shteiwi of the University of Jordan examines this exact question by looking at the country of Jordan over a twenty-four-year period, from 2000 to 2024. This era was defined by constant turbulence, including regional wars, a massive influx of refugees from Syria, and a global pandemic. During these years, Jordan received billions of dollars in foreign assistance from various donors. The researcher gathered data on how this money was spent, tracking everything from the total amount of aid to specific sectors like education, health, and infrastructure. He then compared this spending against real-world outcomes for the people of Jordan, looking at unemployment rates, the number of people living in poverty, and measures of overall well-being. The goal was to determine if the aid helped the country transform its economy or if it only helped the country survive.
The findings reveal a clear and somewhat surprising split. The foreign aid was highly effective at one specific task: building resilience. When the Syrian crisis began and millions of refugees arrived, the aid money allowed the Jordanian government to keep its schools open, its hospitals running, and its water systems functioning. Without this financial support, the study suggests that public services would have collapsed under the pressure. As a result, the overall human development of the country improved. The standard measure of health, education, and living standards, known as the Human Development Index, rose steadily from 0.672 in the year 2000 to 0.754 in 2023. In this sense, the aid worked exactly as intended for a crisis response; it protected the population and maintained stability.
However, the same aid failed to produce a structural transformation. While the country remained stable and its people remained healthy and educated, the economy did not create enough jobs to absorb the workforce. Over the same period, the unemployment rate for Jordanians rose from 13.7 percent to 21.4 percent. The situation was even more severe for women, whose unemployment rate climbed from 21.0 percent to 32.9 percent. The study points to the way the money was distributed as the reason for this failure. Nearly half of all the aid received between 2020 and 2023 went directly to the government's budget to cover general expenses and keep services running. Only a tiny fraction, about 5.3 percent, was directed toward economic development projects designed to create new businesses and jobs.
This imbalance explains why the country could maintain its schools and hospitals while its job market continued to shrink. The aid acted as a shield, preventing the social fabric from tearing apart during times of shock, but it did not act as a hammer to reshape the economy. The researcher notes that while people became more educated and healthier, these gains did not translate into employment opportunities, particularly for women. The gap between men and women in the job market actually widened, with the difference in unemployment rates growing from less than 9 percentage points to nearly 15. Furthermore, poverty levels, which had been relatively low in the early 2000s, showed signs of a sharp increase by 2023, with estimates suggesting that between 24 and 35 percent of the population was living in poverty.
The study concludes that foreign aid in Jordan successfully achieved the goal of resilience but fell short of the goal of transformation. It kept the country standing when it might have otherwise fallen, but it did not help it rise to a new level of economic independence. The money was used to maintain the status quo of public services rather than to invest in the productive sectors that generate employment. For the future, the research suggests that if donors and the Jordanian government want to see real change, they must shift their focus. Instead of just funding the budget to keep things running, they need to direct a much larger share of resources toward projects that create jobs, support private businesses, and specifically address the barriers that keep women out of the workforce. Without this shift, the country may remain stable, but it will continue to struggle with high unemployment and deepening poverty.
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