Jordan-US MoU to help Jordan’s economic development — experts

US Jordan
(File photo: Jordan News)
AMMAN — On September 16, Jordan and the US signed the fourth Memorandum of Understanding (MoU) on Strategic Partnership, whereby Washington provides $1.45 billion per year in foreign assistance to Jordan beginning with fiscal year 2023 and ending with fiscal year 2029. That is $10.15 billion over the next seven years. اضافة اعلان

One of the most significant bilateral instruments of its kind, the MoU represents a major commitment to Jordan’s stability and the durability of the strategic partnership.

According to Deputy Prime Minister and Minister of Foreign Affairs and Expatriates Ayman Safadi, who signed the agreement with US Secretary of State Antony Blinken in Washington, the MoU is pivotal to Jordan’s economic development.

“The assistance is unconditional, and Jordan has embarked on a set of economic and administrative reforms, which were adopted after a comprehensive national dialogue that brought together representatives of the government, the private sector, and the concerned sectors,” Safadi was quoted by Al-Mamlaka TV as saying.

The reforms are imposed by Jordan’s needs, Safadi said, adding that the country’s economy will follow a practical path that will enhance its efficiency and productivity.

The memorandum will be in force for seven years, and the money will start arriving as of next year, Safadi said, specifying that of the annual payment of $1.45 billion, $610 million is in direct support to the Treasury and $400 million will go to the Jordanian Armed Forces - Arab Army, and that the annual payment will help cover some of the cost of several projects announced by the government.

Safadi also said that support is essential to efforts to tackle international crises, deal with refugees and border security, and fight drugs.

Economist Mufleh Aqel told Jordan News that “this agreement, in terms of its duration and value, will constitute an important part of the help” provided to Jordan, which faces economic challenges and seeks to create job opportunities to reduce unemployment.

“The period of this agreement is seven years, which means that Jordan will witness years of economic stability and reduce the forecast budget deficit,” he said, adding that “this amount provides foreign currency for Jordan, reduces its dependence on borrowing from abroad, and reduces external debt to some extent.”

“Jordan must rely on borrowing from the local market and in the local currency,” he also stressed.

The agreement, he said, will help prop the Jordanian budget and support the country, which hosts over 600,000 Syrian refugees, and “help create job opportunities for some of them”, stressing that “Jordan seeks to create stability in the region” and exerts efforts to achieve the two-state solution, “a position that it adheres to and announces on all occasions”.

This amount, Aqel said, could help Jordan reduce its foreign debt, “which is the biggest challenge, given that this is a rare opportunity and Jordan must invest it in paying off part of its foreign debt”.

Economist Youssef Damra said the memorandum is an indicator of the strategic partnership between the two countries.

“It helps the decision makers prepare programs, especially when preparing the general budget, since it gives precise figures, not estimates, he pointed out.

The memorandum “enables Jordan to face challenges and achieve financial and monetary stability”, he said, stressing that priority should be given to addressing the public budget deficit, which he described as “rigid, meaning that it constitutes current expenditures.”

Economist Zyan Zawaneh told Jordan News that the “memorandum of understanding expresses the depth of relations between the two countries”, adding that “the important thing is how the Jordanian governments can invest this aid within the reform package, which has become essential and is no longer just an option, and no longer bears any delay,” as reform committees have shown.

He added that “the volume of US aid constitutes a small aspect in light of the responsibilities and expenses that Jordan bears as a result of US policies, the decline in our trade with the countries of the region, and the volume of Iraqi and Syrian refugees received by Jordan during the last 30 years”.

Read more Features
Jordan News