Jordan Taps IMF Funds

Jordan this week accessed $197mn of new IMF credit from its SDR1.364bn ($1.89bn) August 2012 three-year standby arrangement. Withdrawals on the facility now total $1.5bn.

As this arrangement is due to expire in August 2015, the cabinet has authorized Finance Minister Umayya Tuqan to negotiate a new follow-on facility with the fund. IMF-sponsored reforms to monetary and fiscal policy have had positive results, an official of the Finance Ministry said last month and Jordan has indicated its willingness to carry on with these reforms.

The IMF a month ago completed its sixth review of Jordan’s standby arrangement (MEES, 3 April).

Meanwhile ratings agency Standard and Poor’s has affirmed its long- and short-term foreign and local currency ratings on Jordan at BB-/B, with stable outlook. S&P says that it believes that lower oil prices and energy diversification efforts, will ease pressure on Jordan’s public finances and help contain the current account deficit. Also lower oil prices will help to boost Jordan’s growth prospects. But the switch to imported oil from cheaper Egyptian gas (disrupted since 2012, and reduced to a trickle of only 30mn cfd in 2014) has adversely affected the kingdom’s economic growth. (CONTINUED - 382 WORDS)