The World Bank (WB) will provide Jordan with $250 million in August as part of $500 million in concessional financing to support Jordan’s ongoing reforms, Ferid Belhaj, World Bank MENA vice president, said on Sunday.
The WB already extended $250 million to the Kingdom last week as the first part of the $500 million financing, which was announced late June with a vision to improve the economy and business climate by reducing business costs fostering competition, and increasing exports, he said during a meeting with the media on Sunday.
“The disbursement of the second $250 million will be in August,” he said, stressing the bank’s commitment to and support for Jordan.
The $500 million First Equitable Growth and Job Creation Development Policy Loan (DPL) consists of a grant of $111 million from the Global Concessional Financing Facility (GCFF) and a non-concessional portion of $389 million.
During the meeting, Tania Meyer, resident representative of the WB in Jordan, said the financing will help in the expansion of the number of the National Aid Fund cash transfer programmes.
She said the number will be doubled from 98,000 currently.
Meyer added that the WB would also continue to focus on various areas of support development plans, including those designed to improve the education sector, adding that one of the key areas of support will focus on ensuring access to quality education for all.
Last month, the WB announced that the loan would also expand social safety nets to protect the underprivileged against economic shocks, boost job creation and improve access to finance for small and medium enterprises (SMEs). The programme, will have a specific focus on creating opportunities for young people and women.
The non-concessional portion has a fixed spread and final maturity of 35 years, including a grace period of four and a half years.
“The interest rate on the loan is close to zero,” Meyer said during the meeting, on Sunday.
The WB financing will support reforms to reduce business costs and improve market accessibility as a way of boosting productivity. At the same time, creating flexible and integrated labour markets and better, more efficient social assistance will allow more Jordanians to work, and allow those that do not have employment or decent incomes to benefit from social assistance.
Launched in 2016, the GCFF provides concessional financing to middle income countries hosting large numbers of refugees at rates usually reserved for the poorest countries. The programme brings the World Bank Group’s total commitments to Jordan to $1.3 billion, of which $1.1 billion is on concessional terms.