The IMF says Jordan’s economy continues to demonstrate resilience despite the impact of the regional war.
The International Monetary Fund (IMF) announced on Tuesday that its staff and the Jordanian government had reached a staff-level agreement on the sixth review of Jordan’s economic reform programme supported by the Extended Fund Facility (EFF), and the third review under the Resilience and Sustainability Facility (RSF).
Completion of both reviews, subject to approval by IMF management and the Executive Board, would allow Jordan to receive total financing of approximately $294 million.
In a statement issued at the conclusion of the IMF mission’s visit to Amman from October 21 to November 3, 2026, the Fund’s Jordan mission chief, Cesar Serra, said the economic programme had continued to perform strongly despite persistent challenges and heightened uncertainty resulting from the prolonged war in the Middle East.
Serra said Jordan had met all quantitative performance criteria and most structural benchmarks for the sixth review, while making steady progress towards the programme’s overall objectives. He added that the three reform measures due under the third review of the Resilience and Sustainability Facility were on track for completion.
He explained that completing the sixth review under the Extended Fund Facility would allow a disbursement of 97.784 million Special Drawing Rights (SDRs), equivalent to approximately $133 million, from the programme’s total approved funding of around $1.2 billion.
The third review under the Resilience and Sustainability Facility would allow a further disbursement of 118.764 million SDRs, equivalent to approximately $161 million, from the total approved financing of around $700 million.
Jordanian Economy Continues to Grow
The IMF said Jordan’s economy had continued to demonstrate resilience, supported by the authorities’ commitment to prudent macroeconomic policies, proactive measures to mitigate the impact of the regional conflict, and strong support from international partners.
The Fund noted that the war had affected Jordan’s economy through lower tourism flows, higher trade and transportation costs, weaker foreign direct investment, and increased volatility in energy prices. However, these challenges had largely been offset so far.
It attributed the continued economic activity to strong manufacturing performance, significant growth in transportation and logistics services linked to the expanding role of Aqaba Port as a regional trade and transport hub, a favourable agricultural season, and stronger-than-expected remittances from Jordanians working abroad and regional tourism revenues.
Jordan’s real gross domestic product grew by 3% year-on-year in the first half of 2026, while inflation remained under control despite volatility in global commodity markets.
The IMF also pointed to a narrowing current account deficit, driven by strong export performance, limited non-energy-related imports, and continued robust remittance inflows and regional tourism revenues, which offset the higher energy import bill.
The Central Bank of Jordan continued to strengthen its foreign reserves and maintain comfortable reserve coverage levels above the programme’s targets. This, alongside prudent monetary and fiscal policies, helped maintain confidence in the Jordanian dinar’s peg to the US dollar and contributed to a decline in dollarisation.
The Fund described Jordan’s banking sector as resilient, with ample liquidity and strong capital buffers. However, it said the near-term economic outlook remained highly dependent on the duration and intensity of the war and the continuation of its regional repercussions.
Public Debt Targeted at 80% by 2028
Regarding public finances, the IMF said Jordanian authorities had comfortably met the target for the central government’s primary balance deficit at the end of June 2026.
Prudent expenditure management had largely offset a revenue shortfall equivalent to around 0.8% of GDP during the first half of the year, resulting from the war’s impact on tax revenue collection.
The Fund expected the recovery in revenue collection during the third quarter of 2026, together with ongoing efforts to contain losses at public utilities, to support the achievement of the programme’s fiscal targets by the end of the year.
It noted that Jordanian authorities had renewed their commitment to sustainably reducing public debt through gradual fiscal consolidation while protecting priority social and development spending.
The draft 2027 General Budget Law aims to reduce the central government’s primary deficit, excluding grants, to 0.9% of GDP by strengthening revenue collection, improving tax compliance and increasing spending efficiency.
These measures, alongside efforts to improve the financial sustainability of public utilities, are intended to maintain progress towards the authorities’ target of reducing public debt to around 80% of GDP by 2028.
National Water Carrier and Aqaba Railway Projects
On structural reforms, the IMF said progress continued in implementing the reform agenda, although further efforts could strengthen the results.
It highlighted important advances in improving the business environment, including the adoption of unified sectoral licensing rules and continued implementation of major infrastructure projects.
Work is progressing on the project to desalinate and transport water from Aqaba to Amman, as well as the Aqaba-Shidiya-Maan railway project. The Fund expects both projects to strengthen economic resilience, improve connectivity and encourage private investment.
It stressed the importance of continuing reforms aimed at strengthening competition, increasing labour market flexibility and encouraging the transition to the formal economy to support stronger economic growth and job creation.
Resilience and Sustainability Reforms
Under the Resilience and Sustainability Facility, the IMF confirmed that the three reform measures required for the third review were progressing according to schedule.
These measures include establishing a central register of infrastructure assets owned by government companies in the construction and energy sectors, issuing instructions for a package of health benefits that can be activated during emergencies, and formalising financing procedures for public health emergencies.
The Fund said these reforms would help Jordan strengthen its ability to withstand climate-related and health shocks while supporting long-term economic and external stability.
At the conclusion of its statement, the IMF mission expressed appreciation to Jordanian authorities for the frank and constructive discussions.
The mission held meetings with Prime Minister Jafar Hassan; Deputy Prime Minister for Economic Affairs Muhannad Shehadeh; Finance Minister Abdul Hakim Shibli; Planning and International Cooperation Minister Zeina Toukan; Energy and Mineral Resources Minister Saleh Kharabsheh; Central Bank of Jordan Governor Adel Sharkas; and several other ministers and senior government officials.
