WB loan contributes to growth, economic transformation

14-01-2019 03:21 PM

Ammon News - AMMONNEWS - Finance Minister Ezzeddine Kanakrieh said the $1.2 billion loan, under negotiation with the World Bank, is a soft loan that supports the Kingdom's economic and financial reforms.

Kanakrieh told Petra that the loan doesn't impose any additional burden on public debt as it will support economic growth and contribute to economic transformation.

The loan will be used to repay part of the high-cost debt and thus will contribute to reducing debt as a percentage of GDP and reduce the debt service, Kanakrieh noted.

"The loan's terms, which we started to negotiate, are very easy and include a grace period of 5 years and will be repaid over a period of 30 years with an annual interest rate governed by several options, according to the LIBOR interest rate with an increase of 1.6 percent," the minister indicated.

"The long-term loan helps the treasury manage debt so that it can repay the loans it is entitled to at a higher interest rate," he said, pointing out that the last Eurobond issue was for 30 years, giving it an edge in dealing with debt repayment and reducing its annual burden.

The Ministry of Planning and International Cooperation said the government, within the framework of the economic transformation process, prepared a matrix and procedures for the economic transformation of the years 2018-2022, with the support of the World Bank and the Kingdom's main development partners, which included a number of reforms at the level of policies, programs and actions that stimulate economic growth and transforming it into a job-generating economy.

In response to Petra's inquiries, the ministry said this matrix and procedures are set to be launched in the London conference, which will be hosted by the United Kingdom on February 28, with the participation of representatives from the G7, donor and friendly governments as well as leading international finance and investment institutions and representatives of the foreign and local private sector.

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