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Gov’t to issue $300m bonds to cover Eurobond costs

By JT - Jun 14,2019 - Last updated at Jun 14,2019

AMMAN — The government will issue US-dollar bonds to the local market on June 18 at an estimated value of $300 million, official sources said on Thursday. 

The sources, quoted by the Jordan News Agency, Petra, added that the bonds will be used, along with “a number of other funding sources”, to finance budgetary expenses and contribute to covering the payment of a $1-billion Eurobond, due on June 23.

Minister of Planning and International Cooperation and State Minister for Economic Affairs Mohamad Al-Ississ identified on Tuesday a $725-million instalment from the World Bank’s (WB) $1.45-billion loan to Jordan, received earlier in the day, as the funding source to cover the remainder of the Eurobond payment.

The World Bank Group had agreed to provide Jordan with the loan at a 4 per cent interest rate and with a four-year grace period.

The terms of the loan are concessional, and the maturity of the loan is for 34 years, according to a WB statement issued earlier this month. 

The government had announced the financial commitments due this year in the Budget Law, in addition to the means of meeting them, the sources said, explaining that with the issuance of the dollar bonds, the required sum will be exceeded.

The sources expected participation from banks to cover the full cost of issuing the bonds.

They stressed that paying back the costs of the bonds on time will not impact the Kingdom’s credit in foreign currency, which exceeds $13 billion. 

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