Jordan is negotiating with the IMF to borrow $ 1.4 billion

Jordan is negotiating to borrow $ 1.4 billion

06/18/2012 0:00

Oman (Reuters) –
Finance Minister of Jordan Suleiman Hafez said his government was in talks with the IMF to borrow up to $ 1.4 billion to help ease the pressure on public finances in the absence of aid from neighboring countries richer.
The request to borrow while pushing austerity policies Jordanians who fear reduce subsidies and higher prices to protest in the streets, a threat to stability in the kingdom, which suffered last year protests continued for months inspired uprisings Ā«Arab springĀ». said Hafiz told reporters that Jordan will pull money Siktredha of the pot of a new lending launched by the International Monetary Fund last November to give the states applying sound economic policies is relatively a chance to get liquidity in the short term.
said Hafiz that Jordan sought initially to borrow $ 1.8 billion over five years in two tranches, but the final amount will be less. He said he was reducing the amount of $ 1.4 billion but so far no There is a specific amount for Jordan can draw from it. He refused to give further details. Last year, enabling the Jordanian economy weighted support of maintaining the cohesion of the pumping liquid funds of $ 1.4 billion from Saudi Arabia, a staunch ally fears of uprisings across the region.
did not give Saudi Arabia a similar pledge this year, and some officials say that That is prompting Jordan to request help from the International Monetary Fund. and Jordan has begun a program Takecvia last month raised the prices of fuel, electricity and increase taxes on luxury goods and increase the corporate tax on banks and mining companies. and organized Islamist opposition groups and tribal protests over high prices last Friday and warned authorities of austerity measures that may lead to larger scale demonstrations and perhaps even civil disobedience in poor areas.
Hafiz said the government would not affect the support for baking or cooking gas and also promised not to increase electricity prices for the poor. But he said the actions began to be applied already will not be canceled. It was expected that the first package of austerity measures to savings of $ 300 million dinars (423 million dollars) which will help Jordan to avoid the risk to exceed the budget deficit two billion dinars (2.8 billion dollars) . The target level for the deficit in the first 1.027 billion dinars, or 4.6 percent of gross domestic product.
Economists say that Jordan’s ability to maintain a large system of support – which cost him now more than three billion dollars a year – and on a bureaucratic huge consume the salaries of employees when most spending the government’s $ 9.6 billion is no longer possible in the absence of large inflows of foreign capital or foreign aid pumping ..
Source: alsabaah