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There have been antigovernment protests in the Middle East kingdom of Jordan. It's one of the most stable countries in the region and a key U.S. ally, so any unrest there, which has been relatively rare, is watched closely. These protests are over the economy. NPR's Jane Arraf joins us from the Jordanian capital Amman. And, Jane, how did these protests begin? What are people upset about?

JANE ARRAF, BYLINE: Well, they were initially started as a strike by trade unions. And then they just sort of carried on from there. And for the last two nights, people have been out in the streets - now, not in huge numbers, just a few hundred at a time in some places. But the thing is this is such a tightly controlled country that demonstrations not approved by the government are really rare.

And here's the problem. Jordan is a really poor country that in many ways acts like a rich one. The Jordanian capital is routinely ranked as one of the most expensive in the Middle East, and the city is full of luxury building projects. But people are really suffering. They're having a very hard time getting by. And people in the streets are just fed up.

CORNISH: So I understand some of this has to do with price increases and also an increase in taxes. What's going on?

ARRAF: So Jordan is really deeply in debt. It depends on foreign aid. And a lot of that foreign aid is down. A lot of it comes from the Gulf, from countries like Saudi Arabia. So the government, mandated by an IMF program to bail it out financially, has cut subsidies. And it's raised sales tax to 16 percent - value-added tax. And now it intends to make more people pay personal income tax.

So that means that Jordanians making as little as about $11,000 a year are going to have to pay taxes. They're saying it's just not fair - that the people who should be paying taxes are big businessmen and wealthy people. And they complain about corruption. So that's essentially where it stands. Jordan needs to raise money. That's the way it's doing it, and it's not going over well.

CORNISH: What's been the government response to this argument against these tax and price increases and also to the demonstrations?

ARRAF: So the government points out that only 4 percent of Jordanians actually pay taxes. And there again, Jordanians will say, well, it's up to, you know, corrupt rich businesspeople who are evading taxes to pay them. But in fact, King Abdullah has been listening. And after these protests over the last couple of days, he stepped in today. And he directed that a hike in gasoline and electricity prices that was due to go into effect tonight actually be rescinded. Now, that's a temporary measure, and it's not going to solve things. But it does answer a little bit of that anger.

CORNISH: So what does all this mean more broadly for Jordan's stability?

ARRAF: Well, that is the key question. And it's always been a balancing act to be honest. It's a tiny country. Jordan's neighbors include Syria, Israel, Iraq, Saudi Arabia. It has a really big influx of refugees. And lately, the bigger problem is that the U.S. has moved its embassy in Israel to the disputed city of Jerusalem, which the Palestinians see as their future capital - part of it. The majority of Jordanians are actually of Palestinian origin.

So there's a lot of anger here to begin with - and the poor indisputably getting poorer. But having said that, people do look around the region and see countries that are a lot worse off in terms of stability. And a lot of them are saying, well, it's kind of bad here, but it could be a lot worse.

CORNISH: That's NPR's Jane Arraf speaking to us from Jordan. Jane, thank you.

ARRAF: Thank you. Transcript provided by NPR, Copyright NPR.

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