Saudis to Host Jordan-Support Meeting After Tax Bill Protests

  • Leaders from Saudi, U.A.E., Kuwait, Jordan to meet Sunday
  • Economic reforms seen as adding to poverty, squeezing poor

Anti riot police and security forces block the path of protesters during a demonstration against a draft income tax law near the prime minister's office in Amman, Jordan, on June 6. 

Photographer: Annie Sakkab/Bloomberg

Saudi Arabia and two other Gulf nations will hold a conference to discuss support for Jordan after a proposed income-tax increase sparked protests and led to the removal of the prime minister.

Leaders from Saudi Arabia, the United Arab Emirates, Kuwait and Jordan will meet on Sunday in Mecca to discuss “ways of supporting Jordan in order to exit the financial crises,” the official Saudi Press Agency reported, citing a statement by the royal court.

Jordan has been relying on foreign aid to shore up its finances. The influx of 1.5 million Iraqi and Syrian refugees has further strained a nation whose public debt equals its economic output. The government’s planned reforms were seen exacerbating poverty in a country where unemployment is at its highest in 20 years.

Debt Load

Jordan has been relying on foreign aid to shore up its finances

Source: IMF

Incoming Prime Minister Omar Al Razzaz defused some of the largest protests the country has seen in years after saying he will withdraw the tax bill for review. The bill came under an International Monetary Fund-supported reform program that proposed lowering the threshold for taxable income, eliminating some tax breaks, and increasing levies on some businesses.

Saudi Arabia and the U.A.E. could ease the pressure to rapidly proceed with reform measures the IMF is pushing by ponying up $500 million this year, said Ryan Bohl, Middle East and North Africa analyst at Texas-based Stratfor consultancy.

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