King of Jordan: We are ‘at crossroads’ facing the unknown

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Jordan which is a staunch United States ally with a peace treaty with Israel, has remained the one stable country throughout years of regional turmoil.

Government plans to lift taxes have brought thousands of people onto the streets in the capital Amman and other parts of Jordan since last week, shaking a USA -allied Arab country that has remained stable through years of regional turmoil.

The king's letter designating Razzaz said the hikes had burdened Jordanians and called for better services, blaming regional instability for hampering the sluggish economy.

King Abdullah instructed the government to immediately launch a dialogue about the income tax draft law in coordination with the Parliament, the political parties, the professional associations and the civil society organisations.

A new prime minister has been appointed.

Police chief Major General Fadel al-Hamoud said the protests remained under control, though officers had detained 60 people in recent days, with 42 security forces personnel injured.

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He also wants a dialogue over the planned income tax bill which has approval from Jordan's chief lender, the International Monetary Fund.

The monarch, who has the ultimate say on policy decisions, promised change, but gave no specifics on possible reforms. Presently, 20% of Jordan's population is close to poverty and another 18.5% are unemployed.

Jordan, which suffers from high unemployment and has few natural resource, has seen repeated price rises, including on staples such as bread, as well as extra taxes on basic goods. His appointment nevertheless sends a positive message to foreign donors that Jordan will press ahead with reforms, though in a gradual way, they said. There was also unrest in 2012 when the International Monetary Fund told the government to lift gasoline prices. The tax increases caused his popularity to plummet.

Cabinet member Omar Razzaz, a Harvard-educated former senior World Bank official, replaced Hani Mulki, who quit Monday amid widening protests against his government's austerity program, including a planned tax increase.

In a letter accepting the Mulki's resignation, the king reportedly praised the former PM for "bravely taking hard decisions that were not popular but were in the higher interest of the nation" and urged him to help the new government through the transition process. Critics claim the current tax plan unfairly hits the poor and the middle class.

The country has largely avoided the unrest witnessed by other countries in the region since the Arab Spring revolts broke out in 2011, although protests did flare late that year after the government cut fuel subsidies.

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