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Can Jordan dodge the downturn bullet?

It is expecting thousands of workers home from the Gulf, but whether that's a positive remains to be seen.

The behavior of migrant workers in a downturn is hard to predict. As layoffs begin throughout the Gulf, some estimates have up to 25 percent of the Gulf workforce returning to their homes by the end of 2009. But many may also migrate to Gulf countries less affected by the downturn, or if there is a quick recovery they may return to the Gulf after only a short time in their home countries.

“It’s not easy to say precisely what’s going to happen,” says Ahmed Oran, head of the economics department at the University of Jordan. “The magnitude of the international crisis is not known yet and it has not ended.”

Despite its limited effect on Jordan thus far, the crisis is starting to send ripples through select segments of the economy here.

Last year, Tony El-Khal established a real estate development branch of his UAE-based firm in Jordan. He had planned to begin building twin towers in Amman, but put the project on hold until his company could assess the economic situation going forward. While El-Khal didn’t lay anyone off, he cancelled plans to hire new employees for the project.

He is, however, optimistic that, if not this year, the situation will begin to improve shortly thereafter. “We were hoping that the first half would be bad, and the second half would be the correction, but it seems no, the second half of this year will be not so good as well,” he says.

While businessmen like El-Khal remain optimistic, those on the receiving end of hiring freezes face a much bleaker predicament.

Wajdi El-Asir runs a small electrical engineering firm that contracts out to large construction projects. Just a year ago he had trouble keeping up with the amount of work available. Now, he’s had to lay off two of his 15 employees and is struggling to find even a small project to keep others on the payroll.

“No one is starting new projects right now, because they don’t know what will happen,” he says.

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