On October 11, 2024, the International Monetary Fund (IMF) and the Jordanian government announced an expert-level agreement concerning the second review under the Extended Fund Facility (EFF). This agreement reflects Jordan's commitment to sound macroeconomic policies and ongoing reforms, despite external challenges from escalating regional conflicts.
The IMF's team, led by Ron van Roden, visited Amman from September 30 to October 10, 2024, to discuss the 2024 Article IV consultations and the second review under the EFF, which was approved by the IMF Executive Board on January 10, 2024. The agreement is subject to approval by the IMF management and Executive Board.
Despite the adverse effects of regional conflicts, Jordan's economy is projected to grow by 2.3% in 2024 and 2.5% in 2025, supported by strong international assistance and structural reforms. The agreement will unlock an additional $131 million from the EFF program, which totals approximately $1.2 billion.
Jordan's resilience is underscored by recent upgrades in its credit rating, the first in over 20 years, highlighting the credibility of its economic policies. However, the ongoing regional turmoil continues to impact government revenues and economic performance, prompting authorities to implement measures to mitigate budget deficits.
The IMF emphasized the importance of maintaining macroeconomic stability and accelerating structural reforms to enhance Jordan’s economic resilience and improve living standards, particularly as unemployment remains high, especially among youth and women.
Key discussions included the commitment to reducing public debt to 80% of GDP by 2028 and maintaining a stable exchange rate for the Jordanian dinar against the US dollar. The Central Bank of Jordan will continue to prioritize low inflation and financial stability.
This agreement marks a significant step for Jordan as it navigates complex regional dynamics while striving for economic growth and stability.