‘Foreign currency reserves cover Kingdom’s imports for 7 months’

AMMAN — The foreign currency reserves at the Central Bank of Jordan (CBJ) exceed $13.4 billion, which is enough to cover the cost of the Kingdom’s imports of goods and services for seven months, CBJ Governor Ziad Fariz said on Monday. 

Fariz said, in a CBJ statement carried by the Jordan News Agency, Petra, that the international standard for foreign reserves rate is the coverage of three months.

The governor said that monetary stability is the bank’s top priority, noting that the CBJ is aware of the national economy’s low growth rates and is, consequently, keen on reaching a balance between the requirements of achieving monetary stability and providing funding tools.

He pointed out that the banking system in the Kingdom is “solid and well-structured”, and is able to absorb major shocks and risks due to the fact that banks in Jordan possess high capitalisation ratios, “the highest in the Middle East”, in addition to adequate levels of liquidity. 

Out of the CBJ’s belief that access to financial services is a right for all, and that financial inclusion has become a pillar for realising sustainable and comprehensive growth, the bank has launched the 2018-2020 national strategy for financial inclusion, Fariz said.

He noted that the strategy mainly focuses on five aspects: online financial services; micro-finance; financing small- and medium-sized enterprises; financial awareness and education; and protecting the financial consumer.

The governor said that the national programme for economic reform has been adopted in cooperation with the International Monetary Fund and includes a set of important reform procedures that mainly target the general monetary status, the energy sector and reducing shortcomings in the general budget.

Fariz stressed that despite the impact of some reform measures on citizens’ lives, they enabled the country to overcome a significant portion of the repercussions caused by economic challenges.

He expressed hope that these measures would achieve further success in the medium term, especially in light of the stabilisation of political conditions witnessed in the region, calling for enhancing the investment environment in the Kingdom and guaranteeing so that it benefits from the upcoming reconstruction process in the region.

The governor expected the inflation rate in 2018 to stand at 4.5 per cent, noting that the impacts of inflation resulting from administrative decisions of temporary nature vanish after a short term, and central banks usually do not take any action to counter such inflations, which are normally not accompanied by changes on the medium and long terms.