Gov't concludes negotiations for $1.6b in foreign aid

AMMAN — The government has concluded negotiations to obtain new foreign assistance worth $1.6 billion (JD1.16 billion), to be signed in July and August, Minister of Planning and International Cooperation Wissam Rabadi announced on Monday.

The minister, in a statement to the Jordan News Agency, Petra, said that the new grants committed to Jordan up to mid-June amount to $80 million, while the value of soft loans reached $220 million during the same period, including aid to counter the repercussions of the coronavirus pandemic.

According to Rabadi, the Kingdom is expected to receive JD2.5 billion in foreign assistance, grants and soft loans in 2020.

The committed foreign aid, to date, has been distributed to finance priority development projects, including in the water, sanitation, education, transport, environment and youth sectors, in addition to supporting the health sector in combatting the pandemic. It has also supported Jordan's response to the economic and social fallouts of the pandemic through the Himmat Watan Fund. 

The minister said that foreign aid is divided into several main types: Grants to support the state Treasury, which go to the account of the general budget, such as the US cash grant, European Union grants, Gulf grants and long-term soft loans that extend from 20 to 30 years at low interest rates ranging from 1 to 3.5 per cent.

Soft loans are directed either to support the general budget to bridge the financial gap, to support sectoral budgets or to implement priority development projects listed in the general budget, he said, highlighting that 75 per cent of foreign aid is streamlined as sectoral support through the general budget.

The government is working with the US to expedite the payment of the $845-million US cash grant, he said, adding that the grant agreement is expected to be signed during July, to be paid to the account of the Treasury. 

This grant falls within the US economic aid programme to support the Kingdom for 2020 and is expected to be disbursed before the end of the year.