Background

It is always the case in economic analysis; economic growth is often considered as a necessary condition for improvement of living standards. Persistent income inequalities, even in economies with high growth rate in GDP, however, have led to the recognition that economic growth alone may not reduce poverty and income inequality; one must also take into account the distribution of benefits from economic growth among different segments of the population, especially the poorest households. Real GDP may grow by 10% in a given year, but this figure doesn't tell policy-makers which households benefit from this increase in national income. For example, the additional income may go mostly to middle or upper-income households, may go mainly to poor households, or may benefit all households equally. As a country with quite apparent unequal household income distribution, it is critical for Jordan to monitor this aspect of economic development. It is also important to assess the likely impacts of policy actions on income distribution, and to design long-term development strategies that target poverty.

Jordan, however, like many other countries, has established poverty reduction as a development objective and has designed various policies to achieve this objective. Examples include investment in infrastructure, the establishment of free and industrial zone, and the promotion of economic diversification strategy. Besides, other government policies, such as fuel taxes/subsidies or trade liberalization, may not be specifically designed to target poverty, but can have far-reaching effects on the incomes of different kinds of households, and the economic incentives faced by different sectors of the economy. With that in mind, however, few questions may arise, such as; are these adopted policies consistent with government's poverty reduction objectives? Are they going to contribute much more to poverty reduction in the economy? That said, so do external economic events, such as crude oil price increases, global financial crises or drought, can also have unequal effects on different households. Without an appropriate economic tool, there is no way to assess the macro-economic impact of economic policies and external events on income distribution, and especially the status of the poorest households segment of the economy.
The Social Accounting Matrix (SAM) is a tool that can provide a detailed picture for the flows of all economic transactions taking place during an accounting period (usually one year) within an economy. Therefore, the SAM represents instrument for quantifying the flows in the economic circuit and for simulating the effects resulting from any changes in such flows, whereas the SAM shows the income generated and its distribution among different institutions such as firms, households, government, and the rest of the world.

On the other hand, SAM is used to build macroeconomic models explicitly designed to analyze the distributional impacts of policy change, that is, the effects on employment, incomes and poverty of different household groups. That makes it exceptionally suited to addressing Jordan’s broad development challenges: promoting sustainable economic development and growth, lowering income inequalities, and reducing poverty.

Constructing the SAM has two main objectives: First: Organizing information about the economic and social structure of a country over a period of time, Second: SAM embodies a useful analytical framework for modeling, in which it provides a inputs for integral part of the benchmark data set required to build computable general equilibrium (CGE) model.
The main data sources for a SAM are input-output tables, national income statistics, and household income and expenditure statistics. Although SAM is derived from I/O table, statistically SAM is broader than an I/O table. Accordingly, SAM is shows more details related to all sorts of transactions within an economy. However, an I/O table records economic transactions alone, irrespective of the social background of the transactions. Contrarily SAM, as a national account, attempts to classify various institutions to their socio-economic backgrounds instead/in addition to their economic or functional activities.

The Ministry of Planning and International Cooperation has already taken the lead in constructing and launching the SAM for 2006. The Ministry is in the process updating the SAM for the year 2010. To this end the Ministry is seeking international expertise to support their work on producing the SAM.

Duties and Responsibilities

Objectives and tasks of the Assignment

For Jordan, SAM is an extremely valuable tool, particularly after completing and producing the input-output tables 2010 for Jordanian economy. It is providing a model that can help policymakers think systematically about what kind of future they want and what actions to take today in order to achieve that future. As an economy-wide model, the SAM provides a concrete basis for moving away from segmental standalone planning or modeling approach to integrated, economy-wide planning and modeling approach that capture all segments and sectors of the national economy. The National Development Program (NDP), Medium-Term Fiscal Framework (MTFF), and any future development vision for Jordan are, but few, that can benefit from analysis using a SAM-based model. SAM, therefore, can provide quantitative answers to various socio-economic development planning issues and pertinent problems.

Scope of work

  • Updating the Commodities and Activities Account;
  • Updating the Factor Accounts (i.e. labor, capital, and rent);
  • Updating and configuration of the Institution Accounts (i.e. Household accounts, Corporates accounts, Government accounts);
  • Updating the Capital Accounts Delineation and Structuring;
  • Updating and Structuring the Rest of the World (Exports, Imports, Transfers, ….etc.) Accounts;
  • Balancing processes of the Jordanian SAM 2010;
  • Finalizing and putting in a publishable format and statistical shape.

Deliverables

The consultancy duration is 4 months of signing the contract and deliverables will be as follows:

  • Complete the updated activity and commodity account, the first month of implementation;
  • Complete the updated factor and institutions account, the second month of implementation
  • Complete rest of the world and capital account, the third month of implementation;
  • Complete integrated Social Accounting Matrix, the fourth month of implementation.

Competencies

  • Strong communication, and interpersonal skills;
  • Demonstrated research and analytical skills;
  • Good knowledge of the UN system;
  • Extensive experience in Social Accounting Matrix (SAM) building, structuring and balancing;
  • Displays cultural, gender, religion, race, nationality and age sensitivity and adaptability;
  • Highest standards of integrity, discretion and loyalty.

Required Skills and Experience

Education

  • PHD in economics, statistics, or any other related field.

Experience

  • Ten years of experience at least in a related field;
  • Advanced knowledge of economic statistics, household expenditure and income survey statistics, balance of payment, financial governmental statistics, etc.
Computer skills
  • Excellent computer and word processing skills.

Language Requirements

  • Fluency in written and spoken English and Arabic.
Documents to be included when submitting the proposals

Interested individual consultants must submit the following documents/information to demonstrate their qualifications: 

  • 2-3 page proposal:  Explaining why they are the most suitable for the work; Provide a brief methodology on how they will approach and conduct the work (if applicable);
  • Financial proposal (which includes a breakdown of consultancy fees, travel cost, per diem;)
  • Personal CV including past experience in similar projects and at least 3 references.

Noting that, only applications which include the above, will be considered.

Financial proposal

Lump sum contracts

The financial proposal shall specify a total lump sum amount including fees. Payments are based upon output, i.e. upon delivery of the services specified in the TOR. In order to assist the requesting unit in the comparison of financial proposals, the financial proposal will include a breakdown of this lump sum amount.