Phenix Center for Economic & Informatics Studies Phenix Center for Economic & Informatics Studies
Green energy is a critical issue that demands focused attention from Jordanian policymakers. The transition to green energy is not only an environmental imperative but also a crucial economic opportunity. This transformation is urgently needed to address the economic, environmental, and security challenges facing Jordan.
The economic enterprises most in need are small and medium-sized enterprises (SMEs), which constitute more than 90% of businesses in Jordan and employ around 60% of the workforce. These institutions encompass various economic sectors, especially industry and services, and face numerous challenges in the energy transition process, the most significant of which are access to financing, regulatory obstacles, and market competition.
As Jordan increasingly adopts green energy, particularly renewable sources, SMEs play a pivotal role, given the country’s heavy reliance on imported energy.
Despite the challenges, SMEs have the potential to benefit significantly from cost savings and increased competitiveness by embracing green energy. However, they encounter new hurdles such as taxes and regulatory restrictions, including bureaucratic, financial, and infrastructural constraints. This underscores the need for innovative government policies and effective responses from SMEs themselves.
Many international organizations have supported reforms to improve the business environment for Jordanian SMEs. This international support can bolster these enterprises’ ability to adapt to renewable energy and accelerate the energy transition.
In this context, the government is expected to enhance renewable energy financing by attracting investments from both public and private sectors in solar and wind energy projects. Exploring innovative financing models, such as developing green corridors and fostering innovation ecosystems, is also essential to boost investment and collaboration in the renewable energy sector. Additionally, policies must be developed and implemented to streamline regulatory procedures, provide incentives, and offer assistance to encourage and expedite the transition, thereby enhancing SME participation in the green economy.
Moreover, a focus on vocational and technical training, along with general education, is necessary to promote a culture of understanding and utilizing renewable energy. Robust systems to track progress, integrate climate adaptation strategies (like water conservation and sustainable agriculture), and improve the existing grid and infrastructure to support renewable energy integration are also crucial. Expanding technical assistance services is equally important.
Furthermore, meeting the diverse renewable energy needs of various economic sectors and activities, supported by capacity-building initiatives and information exchange, will ensure widespread support for energy efficiency and renewable resource adoption.
The shift towards green energy is not a choice; it is an urgent necessity for Jordan. Achieving this transition at an appropriate pace requires concerted efforts from the government and SMEs, encompassing policy support, financing, and heightened public awareness.
With proper planning and adequate support, Jordan can capitalize on the opportunities inherent in this path. This will positively impact the country’s economic situation, address challenges hindering economic growth, and ultimately yield significant economic and environmental benefits for current and future generations.
