IMF approves $113 million stand-by credit for Jordan
The executive board of the International Monetary Fund (IMF) approved a two-year stand-by credit for $113 million for Jordan in support of its economic program. As a result of the board's decision, Jordan will be able to draw $14 million immediately.
After the executive board's discussion on Jordan, Eduardo Aninat, deputy managing director and acting chairman, said: "Jordan has established a favorable track record under the EFF, which was successfully completed last May. The Jordanian authorities have continued to demonstrate their commitment to sound macroeconomic policies and structural reforms, which will be reinforced by the new two-year Stand-By Arrangement agreed with the Fund.”
"Jordan's macroeconomic performance continues to strengthen with an increase in real Gross Domestic Product (GDP) growth in the first quarter led by strong export growth. The fiscal position was in line with program projections and the foreign exchange reserve position of the Central Bank of Jordan increased further. The authorities have already taken additional difficult measures to ensure the achievement of their fiscal deficit target for 2002,” he added.
"The new program is aimed at raising economic growth and fostering employment creation through an acceleration of structural reforms and continued implementation of sound macroeconomic policies. The public debt is projected to continue to decline significantly as a ratio to GDP over the program period. At the same time, health and education spending, as well as income transfers to the poor, will be increased under the authorities' Plan for Social and Economic Transformation, which is being financed with non-debt creating flows. It is expected that exports will continue to grow at a healthy rate, and the external position will remain strong,” Aninat explained.
"The program incorporates a bold structural reform agenda. The government's pension system will be overhauled during the program period, reducing pension liabilities in net present value terms by 30 percent over the next 50 years. The tax system will be reformed to improve its buoyancy and simplify its administration. The privatization program will be accelerated and extended to cover most of the remaining enterprises in the public sector.
"Overall, the authorities' program is ambitious. If implemented as planned, it should help Jordan to further strengthen its economic performance over the medium term," Aninat concluded. — (menareport.com)
© 2002 Mena Report (www.menareport.com)