Jordan, IMF get to staff-level deal on EFF, RFF reviews

(MENAFN) Jordan and the International Monetary Fund (IMF) have reached a staff-level agreement following the fourth review under the Extended Fund Facility (EFF) and the first review under the Resilience and Sustainability Facility (RSF). The IMF said Jordan’s implementation of the EFF remains on track, with the country continuing to pursue sound macroeconomic policies, fiscal discipline, and structural reforms aimed at strengthening economic resilience, promoting private-sector growth, and creating jobs.

The fund noted that Jordan’s economy grew by 2.7% in the first half of 2025, while inflation stabilized at around 2%. The Central Bank of Jordan was commended for maintaining monetary stability and upholding the dinar’s peg to the US dollar.

Under the RSF, approved in June 2025, Jordan is advancing reforms to address long-standing challenges in the water and electricity sectors and improve preparedness for public health emergencies. These measures are expected to support economic growth and balance of payments stability.

Once approved by the IMF’s Executive Board, the fourth EFF review would release 97.784 million Special Drawing Rights (SDRs), equivalent to roughly $130 million, while the first RSF review would unlock 79.182 million SDRs (around $114 million) from a previously approved total of 514.650 million SDRs (about $744 million).

The IMF highlighted that Jordan’s economy continues to demonstrate resilience, supported by prudent economic management and strong international backing. Economic growth in the first half of 2025 was broad-based, and fiscal performance is on track to meet the year’s deficit targets through measures to enhance revenue collection and expand the tax base.

The current account deficit is projected to fall to around 5% of GDP, aided by higher tourism revenues and increased exports. Inflation is expected to remain near 2%, supported by monetary stability and robust foreign currency reserves. The banking sector remains healthy, with sufficient liquidity and strong capital buffers.

Looking ahead, growth is expected to surpass 3% in coming years, driven by major investment projects such as the National Water Carrier Project and deeper regional economic integration, particularly with Syria, Lebanon, and Iraq. The government aims to gradually reduce public debt to 80% of GDP by 2028 through fiscal consolidation while protecting priority social and development spending.

Authorities also plan to accelerate structural reforms to boost employment and growth, focusing on improving the business environment, increasing labor market flexibility, enhancing competition, and strengthening the social safety net. Further initiatives include digitalizing government services, including tax and customs administration, and simplifying regulatory processes.

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