The Arab Monetary Fund (AMF) said on Thursday it had extended $117 million in credit facilities to Jordan to help the aid-dependent country make faster progress in structural economic reforms being guided by the International Monetary Fund.
The financing comprising both a three-year facility and a seven-year soft loan will bring the AMF’s total lending to Jordan so far to $500 million.
“These loans will help the Jordanian economy face external and internal shocks,” Jasem al-Manai, the head of the Abu Dhabi-based regional fund, said on the sidelines of the signing ceremony.
Jordan was hit by a financial crisis last year as foreign aid fell and welfare payments soared, leading it to sign a $2 billion IMF loan deal last July, conditional on budget tightening and unpopular cuts in fuel subsidies and hikes in electricity tariffs.
The decision last November to cut subsidies on most fuel products sparked violent protests.
Wealthy Gulf Arab states – Kuwait, Qatar, Saudi Arabia and the United Arab Emirates – have extended a combined $5 billion of project financing to Jordan which the kingdom has begun to draw from, easing budgetary pressures.