The Jordanian government has disbursed JD100mn ($141mn) to some 3.3mn people (70% of the population) to offset the higher cost of petroleum products after the lifting of most subsidies last November, according to the Jordanian Ministry of Finance. The government is compensating poorer Jordanians by paying JD70 ($99) per person to a maximum of six people per family (or JD420). Eligible families are those with a total annual income below JD10,000 ($14,100). The handout is to be paid out three times a year with JD300mn ($423mn) to be disbursed in total. Jordanian Minister of Finance Sulaiman al-Hafidh said last week that the second payment will be made around the end of March. By then the ministry would have feedback needed to address any problems with the scheme.
Withdrawing most subsidies at the end of the year became a necessity as the budget deficit ballooned and the government was no longer able to bear the burden. Following the overthrow of the Husni Mubarak regime in Egypt in early 2011, the flow of Egyptian gas to Jordan was sporadic because of the frequent sabotage of sections of the Arab Gas Pipeline (AGP) which supplied the cheaper gas to the kingdom. To make up for it, Jordan had to shift to more expensive fuels for power generation and other needs, thereby raising the fiscal deficit. In November 2012, Egypt agreed to raise gas exports to Jordan to the full 250mn cfd stipulated in the 2004 agreement between the two countries. Exports of gas were raised for some time in January, but then fell to below 100mn cfd as street violence erupted in Egypt. Jordan has since complained about the large drop in supply, but Egypt denied exports were reduced because gas was needed for Egypt’s own power plants. (CONTINUED - 292 WORDS)