Moody's Upgrades Jordan's Sovereign Credit Rating for First Time in 21 Years

Moody's Upgrades Jordan's Sovereign Credit Rating for First Time in 21 Years
Amman - Moody's credit rating agency has announced the upgrade of Jordan's long-term sovereign credit rating in local and foreign currencies from B1 to Ba3, marking the first such increase in 21 years.اضافة اعلان

The agency attributed the rating increase to Jordan's effective public finance and macroeconomic management, along with measures to mitigate risks, which have bolstered the country's resilience against external shocks, aligning with a higher credit rating.

Jordan's proactive policies shielded its credit rating from the impacts of the global pandemic, rising global energy and food prices, and the Russia-Ukraine conflict, maintaining financial stability amidst challenging circumstances.

Commenting on this milestone, Finance Minister Muhammad Issis stated, "This accomplishment reflects the deep structural reforms undertaken by the Jordanian government to safeguard the middle class from global and regional shocks by expanding domestic revenue fairly and gradually, without burdening citizens with additional taxes."

Issis highlighted this achievement as another international acknowledgment of the profound reform agenda initiated by His Majesty King Abdullah II, which has strengthened Jordan's resilience and boosted growth rates, despite challenging global and regional conditions.

The rating upgrade underscores financial stability, supporting Jordan's diplomatic efforts led by His Majesty to alleviate the ongoing aggression against Palestinians.

Moody's highlighted Jordan's robust financial and monetary policies, international financial and technical support, and domestic financing volume as factors behind the rating.

The agency commended Jordan's commitment to implementing significant structural reforms, enhancing the business environment through the new investment law, and stabilizing public finance indicators.

According to Moody's, public finance indicators are expected to remain stable in the coming years, with the general government budget deficit projected to range between 1.5 to 2 percent of GDP during 2024-2025, declining to 80 percent of GDP by 2028, from about 90 percent in 2023.

Adel Sharkas, Governor of the Central Bank of Jordan, hailed Moody's upgrade as testament to the resilience of the national economy amid regional challenges, attributing it to successful economic policies.

He emphasized the significance of the monetary policy in maintaining monetary and financial stability, underpinned by stable inflation rates and the fixed exchange rate system for the Jordanian dinar against the US dollar, backed by record-high foreign reserves of $19 billion.

This high rating sends a positive message to global financial markets, affirming Jordan's economic approach and supporting its attractiveness as a secure investment destination during the completion of the first review of the financial and economic reform program with the International Monetary Fund.

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