Jordan and Saudi Arabia sign project financing plans
Jordan and Saudi Arabia on Thursday signed four agreements to finance development projects at a total of $299.4 million (around JD212.36 million).
Of the $299.4 million, $42.4 million will be used to finance economic development zones’ infrastructure, while $62 million will fund technical community colleges and university infrastructure development projects, Planning Minister Jafar Hassan told journalists following the signing ceremony.
A total of $75 million will be used to finance the establishment of Al Shiddiyeh Railway, which is part of the national railway project. The remaining $120 million will be used for the reconstruction of the road linking the central city of Zarqa with the Jordanian-Saudi border at the Omari crossing point.
“The Zarqa-Omari project will improve the road and reduce accidents,” the minister said.
“The agreements are a continuation of previously signed financing deals between the two sides, totalling $487 million, under the first stage of Saudi Arabia’s grant to the Kingdom,” he added.
These funds are earmarked to serve projects in several sectors, including health, education, water and transport, the minister said.
The overall first part of the grant amounts to $786.4 million out of Saudi Arabia’s $1.25 billion contribution to a $5 billion Gulf Cooperation Council (GCC) grant pledged to the Kingdom in 2011 to be paid over five years.
“We actually started using some of these funds at the end of 2012 retroactively for the development process, from September 2012,” Hassan told The Jordan Times.
The total grant will be used to mitigate pressure on the state budget, he added.
“The decision to finance projects was taken by the leaders of the GCC countries to support the Kingdom’s development projects and indirectly support the budget,” Yousef Al Bassam, vice chairman and managing director of the Saudi Fund for Development, which administers the grant payment, told reporters.
Under the state budget envisaged for 2013, the deficit was calculated to reach around JD1.31 billion or 5.4 per cent of the gross domestic product.