Interest in Jordan's parliamentary elections goes up in smoke
In an attempt to placate voters angry about fuel price hikes, Jordan has lowered cigarette prices. But the two moves have overshadowed the key thing: voting in upcoming elections.
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The unpopular gas price hikes were adopted at the request of the International Monetary Fund, which made them a condition for the Jordanian government to receive $2 billion in IMF aid to avert an economic collapse.Skip to next paragraph
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Jordan is struggling under a budget deficit of about 11 percent of GDP, and more hard times are likely on the way: After the parliamentary election, the new government is expected to raise electricity rates; the cutoff of cheaper Egyptian natural gas in 2011 because of attacks on the Sinai pipeline pushed up costs.
Mohammed Dairi, a parliamentary candidate running in Amman's third district, criticized the cigarette price cut as a bad public health policy but also acknowledged that Jordanians' top concern right now is their pocketbook.
"People don't talk right now about parliament. They talk about the price of gas," he says. "Jordanians want to make sure that they have a job and enough food on the table. They aren't interested in politics."
Analysts and Jordanians say that the anger over the price hikes were enhanced by a sense that government does not work for them because it is corrupt and too easily influenced by groups with wasta, or connections. Some see the decision on cigarettes as a related problem: an example of the government bowing to a powerful business lobby.
Khalid al Wazzani, an economist, says that the government has defended the cuts by arguing that it will stimulate demand for cigarettes and generate more tax revenue for the government. The price cut has had the desired effect, from the government's perspective. Demand for locally made cigarettes has surged since December, as their prices have become competitive with those of the smuggled cigarettes.
"Everybody is going for Marlboros because it's now at a regular price," says Hikmat Il-Turk, the owner of the Al Mhwarde Tobacco Shop in Amman. "They tried to make Jordanian cigarettes cheaper to compete with the illegal ones."
However, Mr. Wazzani believes the cigarette price cuts are a symptom of a government that is "soft" when it comes to resisting business interests.
"If corruption is when you don’t do your job properly, then this is it," says Wazzani, who also owns Is-Snaad, an Amman consulting firm. "If you insist on raising the price on gas, you should raise the tax on cigarettes. This is a precedent I have never seen anywhere in the world."
He said that the short-term economic benefit would be offset by a long-term rise in health expenditures.
Even grateful smokers in Jordan couldn’t help noticing that the cuts were timed just one month after the removal of the gas subsidies. At the tobacco shop, Mandouh Hannoun said that he’d prefer to have cheaper gas prices and higher cigarette prices.
"Consumers are always happy for lower prices, it’s only natural," he says. "It’s good for the cigarette companies. But it's bad for the public health of the people."
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