The European Parliament has approved a new €500 million macro-financial assistance (MFA) package for Jordan, under the European Union’s MFA mechanism aimed at supporting economic stability and strengthening the Kingdom’s resilience in the face of regional tensions and volatile global economic conditions.
اضافة اعلان
The decision was passed by an overwhelming majority, with 585 of the 664 Members of the European Parliament voting in favor, while 45 abstained.
This vote constitutes the European Parliament’s position at first reading under the ordinary legislative procedure. The draft will now be referred to the Council of the European Union to adopt its position, paving the way for the completion of the final legislative process and the official entry into force of the assistance once approved by both institutions.
European Parliament President Roberta Metsola said on Tuesday that strengthening support for Jordan contributes to reinforcing regional stability and enhancing Europe’s shared security.
Metsola noted that the Parliament’s vote on macro-financial assistance for Jordan carries particular significance, as it supports the Kingdom in advancing reforms and bolstering its economic resilience, describing it as an investment in one of Europe’s strategic partners.
According to a European Parliament document monitored by Al-Mamlaka, the assistance forms part of broader European efforts to support Jordan’s economy in meeting its external financing needs amid escalating geopolitical pressures in the Middle East.
This package is the fifth of its kind, following four previous EU macro-financial assistance programs implemented since 2014, totaling €1.58 billion. The most recent package, approved by Parliament last April, amounted to €500 million for the 2025–2027 period.
In its proposal, the European Commission noted that Jordan has continued implementing its Economic Modernization Vision 2022–2033 and has maintained a close partnership with the International Monetary Fund through a $1.2 billion Extended Fund Facility program for 2024–2027, which recorded positive reviews through April 2025. Jordan has also benefited from $700 million in new financing under the Resilience and Sustainability Facility.
In January 2025, the European Union and Jordan agreed to launch a Strategic and Comprehensive Partnership based on pillars including political dialogue and regional cooperation, security and defense, economic resilience, trade and investment, human capital development, migration, and refugee protection. The new assistance is part of the financial package supporting the implementation of this partnership.
The Jordanian government formally requested the additional assistance in January 2025, citing regional developments—particularly tensions between Israel and Iran and the associated airspace closures and flight suspensions—which have deepened economic uncertainty and led to declines in tourism and investment, alongside weaker exports, domestic consumption, and government revenues.
According to the proposal document reviewed by Al-Mamlaka, ongoing tensions in the Middle East due to the war in Gaza, developments in Lebanon, the fall of the Assad regime in Syria, and the escalation between Israel and Iran have had negative repercussions on Jordan’s economy.
These factors have affected tourism, trade, and investor confidence. Economic growth stood at around 2.5% in 2024, while inflation remained below 2%, reflecting lower import prices and tighter monetary policy linked to the U.S. dollar peg.
The document notes that Jordan continues to face deep structural challenges, including a high unemployment rate of 21.4%, with higher levels among youth and women, as well as low labor force participation.
Despite government measures to boost revenues and control spending, the budget deficit rose to 5.6% of GDP in 2024, while public debt reached 90.4% of GDP excluding Social Security debt. The current account deficit also widened to around 6% of GDP due to weaker exports and tourism revenues.
The new assistance will be provided entirely in the form of concessional, long-term loans totaling €500 million, to be disbursed in three tranches over a period of up to two and a half years from the entry into force of the Memorandum of Understanding.
Disbursements will be conditional on Jordan’s commitment to implementing a robust IMF program and delivering an agreed reform package covering public financial management, revenue mobilization, labor market policies, governance, energy and utilities, and improvements to the business environment.
The proposal document emphasizes that this assistance is part of the EU’s policy to support economic stability and enhance Jordan’s capacity to continue reforms, within the framework of a long-term political and economic partnership between the two sides. It also supports the Kingdom’s efforts to address the fallout from regional crises and strengthen its ability to maintain financial and economic stability in the coming period.
