S&P maintains Jordan's credit rating at B+/B with ‘stable outlook’

Central Bank of Jordan CBJ
(File photo: Jordan News)
AMMAN Standard & Poor's (S&P) Credit Rating Agency has maintained Jordan's long-term sovereign credit rating at B+/B with a stable outlook. اضافة اعلان

S&P highlighted the impact of the war on the Gaza Strip on Jordan's economic landscape, stating that the war led to increased regional tension and affected Jordan's tourism sector and trade activities. Despite these challenges, S&P noted that its stable outlook for Jordan indicates that the conflict will not escalate beyond Gaza, Al-Mamlaka TV reported.

The agency said, "We believe Jordan will effectively leverage international support and has adequate domestic policy buffers to manage the conflict's impact on tourism and the broader economy.”

S&P attributed the preservation of Jordan's credit rating to the effectiveness of its financial policies in maintaining stability despite regional challenges, highlighting the success of Jordan's public finances in reducing the deficit and ensuring a safe downward trajectory for debt levels. Additionally, S&P commended Jordan's monetary policies for maintaining stability in the financial and banking sectors, which have proven crucial in navigating external crises such as Israel's recent waron Gaza.

The agency also underscored the significance of Jordan's Financial and Monetary Reform Program, implemented in collaboration with the International Monetary Fund (IMF), and the strong international support extended to Jordan.

Recently, the IMF board approved a new program for Jordan, the Extended Fund Facility (EFF), valued at $1.2 billion over four years, to continue implementing economic and financial reforms following the successful completion of previous program requirements.

In terms of public finances, S&P's forecasts indicate the success of fiscal policy in reducing the government's deficit to 1.1 percent of Gross Domestic Product (GDP) by 2024, with projections indicating a decrease in the government's net debt ratio to 78.9 percent by 2027.

Additionally, in a statement released on Saturday, the Ministry of Finance emphasized that Jordan's maintenance of its credit rating comes at a crucial juncture, amidst regional challenges and geopolitical uncertainties. This announcement coincides with a period marked by a wave of credit rating downgrades affecting countries worldwide, due to the prevailing uncertainty in the region.

Minister of Finance, Mohamad Al-Ississ said, "Maintaining Jordan's credit rating despite the repercussions of the war in Gaza and the ongoing attacks in the West Bank, despite the increasing regional uncertainty, represents a new certificate and confirmation from international institutions of the strength of Jordan's public finances, and evidence of the effectiveness of the economic and financial policies adopted by the government to maintain financial stability."

For his part, Governor of the Central Bank of Jordan (CBJ), Adel Al-Sharkas, echoed similar sentiments, highlighting the stability of Jordan's economy amidst global and regional challenges. Sharkas underscored the success of CBJ in establishing monetary and financial stability, maintaining the fixed exchange rate of the dinar, and bolstering foreign reserves to $18.1 billion, emphasizing the resilience and efficiency of the Jordanian banking sector in adhering to international banking practices and managing risks effectively.

Read more National news
Jordan News