Japan extends $196 million soft loan to Jordan

AMMAN — The Japanese government will present a soft loan of 24 billion yen (around $196 million) to Jordan at the current exchange rate, with the agreement and memoranda of understanding signed on Wednesday, a Planning and International Cooperation Ministry statement said. 

The loan will be offered through the Japan International Cooperation Agency (JICA) to support Jordan’s fiscal consolidation and development policy.

Minister of Planning and International Cooperation Imad Fakhoury signed the memos with Japanese Ambassador to Jordan Shuichi Sakurai and the agreement with JICA Chief Representative in Jordan Shokichi Sakata, according to the statement.

During his visit to Jordan in January, Japanese Prime Minister Shinzo Abe announced a $100 million soft loan, and after considering the Kingdom’s economic situation, the Japanese government decided to double the amount, a statement released by the Japanese embassy said.

According to Fakhoury, the loan will be paid back over 25 years, seven of them a grace period, with an annual interest rate of 1.7 per cent. 

The minister also said the that loan will be transferred to Jordan in two phases, 12 billion yen upon its signing, and the other 12 billion yen at the end of 2015.

Jordan previously received a loan from Japan worth $118.4 million.

At the signing ceremony, Fakhoury thanked the Japanese government for its continuous support to the Kingdom, noting that the loans will improve public services.

The embassy statement quoted Sakurai as saying: “I strongly hope that the new loan will mitigate the challenges that the Jordanian economy faces.”

Between the years 1999 and 2014, Jordan received around $785.77 million from Japan — $451.37 million as grants, and the rest as soft loans, in addition to technical support from JICA.