The International Monetary Fund has approved a $723 million loan facility to Jordan in a three-year programme to support economic and financial reforms aimed at lowering public debt and accelerating growth, it said on Wednesday.
The IMF said in a statement the first $723 million tranche was to be paid immediately, and the remaining amount would be disbursed over the duration of the programme.
The deal is focused on reducing public debt to 77 percent of GDP by 2021 from 94 percent now.
Debt rose by almost a third to $32 billion in five years as economic strains reduced revenues and foreign aid, forcing Jordan to borrow more.
The programme comes almost a year after the conclusion of a three-year $2 billion standby deal that stabilised the economy after the strains brought on in part by the higher spending.
The IMF has said Jordan must improve competitiveness to shore up growth weakened by regional uncertainty that has damaged investor sentiment, exports and tourism and raised unemployment.
The IMF programme envisages a gradual recovery in the growth rate of real GDP to 4 percent by 2019. Growth is forecast to reach 2.8 percent this year, a slight increase from 2.6 percent in 2015.For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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