Contracted aid for kingdom up in 2017, but grants directed to support budget shrink

AMMAN — The total foreign aid contracted by donors to Jordan in 2017 reached $3.65 billion, compared with $3.15 billion in 2016, a Planning and International Cooperation Ministry statement said on Tuesday.

The aid (which represents signed agreements approved by Cabinet) includes regular grants, concessional loans and additional grants to the Jordan Response Plan (JRP) to address the Syrian refugee crisis.

Total assistance committed excluding support to refugees of US$653.7million under JRP reached about US$2.99 billion (compared to US$2.55 billion in 2016).Planning and International Cooperation Minister Imad Fakhoury said in the statement that the aid comes in recognition of Jordan’s pivotal role and its comprehensive reform plans to assist it to shoulder the refugees burden, and continue playing a role model in dealing with this section of the population.

Fakhoury added that foreign aid supports the budget, helps cover the financing gap, funds development projects according to national priorities, provides technical assistance, builds institutional capacity and enhance foreign reserves.

He stressed that despite the increase in the volume of foreign aid to the Kingdom for 2017, the figures show a decline in grants to support the public budget, in light of the near depletion of the Gulf grant and the insufficient foreign aid, a fact that emphasises the need to deepen the concept of self-reliance in accordance with the Jordan Document 2025, the National Financial and Economic Reform Programme and the Jordan Economic Growth Stimulation Plan, which aim to immunise Jordan economically and financially from external shocks.

He also stressed Jordan continues to hold the international community responsible for the burdens of hosting of Syrian refugees. 

The minister explained that the foreign aid includes regular grants, concessional loans and additional grants to fund the JRP 2017-2019 with its three main themes (public budget support, development projects in host communities and refugee support).

The regular grants contracted during 2017 amounted to about $840.4 million and soft loans to $1.08876 billion, while the amount of funding through additional grants for the JRP stood at $1.719 billion.

Of the regular grant support, $291.81 million was extended as budget support to be disbursed over the years 2017-2019, while $548.581 million was earmarked for development projects, the statement said.

The concessional loans include $768 million, as budget support to be disbursed over 2017-2018, and $320.76 million in highly concessional loans for development projects.

The concessional loans have long repayment periods of up to 35 years, and grace periods ranging from 5-10 years

with an interest rate that does not exceed 2 per cent, Fakhoury said.

He added that the loans would contribute to covering the financing gap and restructuring the public debt, in accordance with the national financial and economic reform programme and the state budget.

A total of $620.7 million has already been transferred to the Treasury, including payments from existing soft loans and payments from new loans during 2017, the statement said.

As for the support for JRP, it covered 64.8 per cent of 2017’s funding requirements, compared with 62 per cent in 2016. 

The JRP support includes $758.4 million for development projects related to host communities (resilience support), $653.7 million as humanitarian aid for refugees and $306.8 million as budget support that has been already funnelled to the Treasury.

Fakhoury noted that the government requires that support projects for refugees include support for Jordanian beneficiaries by at least 30 per cent. 

The total value of purchases and services by the UN organisations from the Jordanian local market for these projects for 2017 amounted to $353.7 million.

During the year 2017, the minister said that the total value of grants directed to support the public budget and actually transferred to the Treasury was JD708 million.