AMMAN — Transferring the debt owed by the
National Electricity Power Company (NEPCO) to the public debt is a formal procedure that does not relieve the
government from the cost of this debt nor from the responsibility to pay it,
economists interviewed by Al-Ghad News said on Wednesday.
اضافة اعلان
The
decision does, however, provide more oversight over the company's performance
after freeing it of its debt burden.
NEPCO’s
director, Amjad Al-Rawashdeh, said that “the company is studying, in
partnership with the Ministry of Finance, the transfer of the company’s debt to
the public debt,” such that the latter can find ways to repay and/or reschedule
the former’s debt.
Mufleh
Aqel, a financial expert, called the decision the “best solution” given the
reality of the company’s situation, “especially since (NEPCO’s) debts and
losses come as a result of a series of government decisions, including the
pricing of oil derivatives”.
At
the end of 2020, NEPCO owed approximately JD4.98 billion, which exceeds 75
percent of its paid-up capital. By comparison, the company’s accumulated losses
at the end of 2019 stood at JD4.92 billion.
To
facilitate this transfer, the government will invoke Article 266a of the
Companies Law No. 22 of 1997, which states that “if a company’s losses amount
to three-quarters of the value of its capital, it must be liquidated unless the
general assembly decides in an extraordinary meeting to increase its capital”.
The
World Bank is considering giving a $500 million loan to Jordan at the beginning
of 2022 under the name of the
Jordanian Electricity Sector Sustainability and
Reform Program.
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