Jordan signs financial assistance agreements with Saudi Arabia, Kuwait, and UAE

[04-10-2018 04:17 PM]

Ammon News - AMMONNEWS - In the presence of Deputy Prime Minister and Minister of State, Rajai Muasher, the governments of Jordan, Saudi Arabia, Kuwait and the United Arab Emirates (UAE) signed a number of agreements and memorandums of understanding (MoUs) for their aid pledges under the June Mecca Summit. The aid package of 2.5 billion dollars will strengthen Jordan’s economy, help maintain monetary stability, and increase government spending on development projects.

The agreements were signed by Minister of Planning and International Cooperation, Mary Kawar, the Saudi Finance Minister Mohammed bin Abdullah Al Jada'an, Kuwaiti Finance Minister, Nayef Al Hajraf, UAE Minister of State for Financial Affairs Obaid Bin Humaid Al Tayer, and Director General of Kuwait Fund for Arab Economic Development Abdulwahab Al Bader.

Governor of the Central Bank of Jordan (CBJ), Ziad Fariz, signed the Saudi Deposit Agreement at the bank's headquarters.

On the agreements, the Jordanian and Saudi sides signed Riyadh's contribution, which included a grant agreement worth $250 million over five years to support the public budget to implement development projects and programs, in addition to signing a deposit agreement at the Central Bank of Jordan worth ($333.3 million).

The Jordanian and Kuwaiti sides also signed a memorandum of understanding (MoU) on Kuwait's contribution to the Mecca Summit assistance package, including a deposit at the Central Bank of Jordan worth $500 million on preferential terms and a loan program of $500 million over a period of five years, $100 million per year starting from the fiscal year 2019/2020 to contribute to the financing of infrastructure projects, and the rescheduling of the outstanding balance of seventeen loans, which were fully withdrawn and unpaid, as of 31 December 2018. The loans total (91.1) million Kuwaiti dinars which is equivalent ($300.7 million) on a 40-year period, including a grace period of 15 years and at an interest rate of 1 percent annually.

The Jordanian and UAE sides signed a memorandum of understanding that includes the contribution of the United Arab Emirates to the Mecca commitments, namely, a deposit at the Central Bank of Jordan worth $333.3 million, and a grant to support the Jordanian government budget worth $250 million over five years, in addition to development loans worth $50 million. UAE will also provide guarantees to the World Bank of $200 million dollars. .

On the occasion, Deputy Prime Minister thanked the Kingdom of Saudi Arabia, State of Kuwait and the United Arab Emirates for their continuous support of Jordan.

During a meeting with the three Arab Gulf countries' finance ministers, Muasher said the support of the brotherly countries aims to address the current economic conditions facing Jordan resulting from the instability in the region and its repercussions on the Kingdom.

This aid clearly signals the strong relations between the Hashemite Kingdom of Jordan and the brotherly countries, which have contributed to enable Jordan to overcome the various challenges and to push ahead with the implementation of diverse reform programs, Muasher pointed out.

For their part, finance ministers of Saudi Arabia, the United Arab Emirates and Kuwait expressed their pride in their countries' ties with Jordan, which are based on a long history of brotherly relations and said "their countries feel the responsibility to support Jordan and help it to counter the economic challenges."

For her part, Minister Kawar said the new aid will contribute to supporting efforts of the Jordanian government to overcome its economic difficulties through reform programs and continuing current efforts aimed to address the economic challenges that Jordan is facing.

Kawar said the Mecca Conference pledges were aimed at strengthening the brotherly ties between Jordan and the three Arab Gulf states, adding they reflected the belief of the leaders of brotherly countries to support efforts to overcome Jordan's economic and financial challenges.

In a press statement after the signing ceremony, Finance Minister Ezzedine Kanakrieh said the financial support and assistance, which came as an outcome of the Mecca Conference is "a real reflection of the close relationship that bring together the leaders and peoples of the four countries".

Kanakrieh noted the agreements include a financial assistance worth $2.7 billion, of which is $1.16 billion will be deposited in the Central Bank of Jordan and a $500 million grant to the Treasury over five years to support implementation of budget's development projects and the rest of the amount came in the form of soft loans, guarantees, and rescheduling of loans due to development funds in these countries .

He thanked the Gulf Arab countries for their support, particularly during the economic circumstances facing Jordan, and voiced confidence that this assistance will positively affect the national economy and economic growth.

The grants to the budget will help reduce the deficit and the loans will be used for development projects, he said, noting the deposits that will be transferred to the Central Bank of Jordan (CBJ) will help support the bank's foreign currencies reserves, which will reflect positively on the economic circumstances.

The Minister of Finance also thanked the brotherly countries for their assistance, saying, "We look forward to further exchanges and cooperation in all fields."

The Minister of Finance, Ezzedine Kanakrieh, the Saudi Ambassador to Jordan, Prince Khalid bin Faisal bin Turki Al Saud, Kuwaiti Ambassador to Amman Aziz Al Deihani, and the UAE Ambassador in Amman, Mattar Al Shamsi attended the signing ceremony (we should add His Majesty, Prime Minister, Director of His Majesty’s Office, and Economic Advisor) .

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