European Commission to provide 500 mln euros in Macro-Financial Assistance to Jordan

The European Commission has adopted Monday a proposal for a new Macro-Financial Assistance (MFA) operation to Jordan worth up to 500 million euros, as an important demonstration of the EU's partnership and solidarity with Jordan. A press release by the European Commission announced, "This financial support aims to help Jordan cover part of its external financing needs, support the fiscal consolidation effort and support structural reform efforts so that Jordan's ambitious reform agenda can continue, promoting jobs, growth and investment. Ursula von der Leyen, Commission President, said: "Today's proposal is a clear sign of the EU's continued solidarity with Jordan. With up to 500 million euros, we will support Jordan in these difficult times of geopolitical instability. And we will help ensure that Jordan's transformative reforms for jobs, growth and investment can continue." The new operation builds on the three previous MFA programs through which the EU has disbursed a total of 1.08 billion euros to Jordan since 2013. The final disbursement to Jordan under the last MFA operation took place in May 2023. Past MFA programs have helped the country address its urgent financing needs, including in the context of the COVID-19 pandemic, supported overall macroeconomic stability and were a key driver of the implementation of transformative reforms. MFA funds are made available in the form of long-term loans at concessional terms. The disbursement under this new operation is planned to take place in three installments. Disbursements under the proposed MFA would be strictly conditional on the implementation of specific policy measures to be agreed upon between the EU and Jordan and set out in a Memorandum of Understanding, as well as successful program reviews under the IMF program. The MoU could, in principle, include policy reforms addressing economic governance, including public finance management and tax administration; social and labor market policy; and governance and fight against fraud, corruption and money launde ring. The Commission's proposal for a fourth MFA with Jordan is subject to the approval of the European Parliament and the Council. MFA is part of the EU's wider engagement with neighboring countries and is intended as an exceptional EU crisis response instrument. It is available to enlargement and EU neighborhood countries experiencing severe balance-of-payments problems. The implementation of the proposed operation is further complemented by EU bilateral cooperation under the Neighborhood, Development and International Cooperation Instrument- Global Europe ('NDICI-GE'). The new MFA operation proposed for Jordan comes at a time of increased uncertainty and regional instability. The EU's support to Jordan, including through MFA programs, assists the country in mitigating the impact of the war in Syria and the resulting large number of refugees. Overall, the EU has already mobilized around 4 billion euros for Jordan since the beginning of this crisis in 2011. This support is provided by the EU-Jordan partne rship priorities, as confirmed during the fourteenth meeting of the Jordan-EU Association Council on 2 June 2022. These priorities are based on common values and dialogue and promote reforms in areas such as good governance, the rule of law, human rights, social cohesion and equal opportunities for all, non-discrimination, environmental and climate protection, macroeconomic stability and the business environment. Source:Kuwait News Agency